washingtonpost--2020-05-18--Analysis | How Short Sellers Become Targets During Market Routs

Short sellers borrow shares and sell them , hoping to buy them back at a lower price to profit from the difference .
But getting the timing right is crucial .
If the stock price rises , they could lose money instead .
Most shorting is done by hedge funds and institutional investors to cushion their investments or to bet that shares have risen too high .
There are also so-called activist shorts , who research companies to find targets that they allege have dodgy business or accounting practices , spread the word ( sometimes anonymously ) and , if @ @ @ @ @ @ @ stock slump .
Many authorities dislike short selling .
The former head of the New York Stock Exchange has described the practice as “ icky and un-American.
” It ’ s legal in most major stock markets , though some may issue temporary restrictions during periods of market turmoil .
Short selling was already under attack before the stock market started tanking in February .
French politicians prepared a report last year on ways to rein in short sellers and activist investors , and German authorities began an investigation into speculators who criticized @ @ @ @ @ @ @ .
What is banned either partially or fully in several markets is so-called naked short selling -- betting on a stock ’ s decline without having first borrowed the shares .
Six European countries -- France , Spain , Italy , Belgium , Greece and Austria -- banned short-selling in March when regulators said such trading could exacerbate the steep declines in equity markets .
The bans , which had been strongly opposed by hedge funds , proprietary trading firms and Germany ’ s primary exchange , ended May 18 in a coordinated @ @ @ @ @ @ @ South Korea has banned short-selling of shares in the benchmark Kospi index , tech-heavy Kosdaq index and small-cap Konex from March 16 to Sept. 15 .
The European Securities and Markets Authority , which oversees standards across the bloc and had ordered hedge funds and other traders to disclose more information when they bet that stocks will decline , said it will continue to require increased disclosure of short positions until at least June 16 .
It ’ s hard to tell what would have happened without the bans .
Regulators in France @ @ @ @ @ @ @ needed any longer because trading has become more normal .
While volatility is higher than it was in February before the virus outbreak in Europe , France ’ s Autorité des Marchés Financiers said this is more a reflection of traders ’ uncertainty about the future .
AMF Chairman Robert Ophele said in a Bloomberg TV interview that the restrictions “ didn ’ t have any detrimental effects ” on the market and he looks forward to subsequent research on the effect of the bans , which covered markets hosting 60 % of @ @ @ @ @ @ @ yes .
The U.S. targeted short selling during the Great Depression and joined the likes of the U.K. , Germany and Japan in limiting short selling or banning it in 2008 during the global financial crisis .
China ’ s regulator blamed “ malicious ” short selling in part for a stock market crash in 2015 , placing limits on the practice as well as arresting traders .


washingtonpost--2020-05-18--Startups Decide It’s Easier to Skip PPP Money Than Decipher Rules

“ We ’ ve gone through the five stages of grief , ” said Bilal Zuberi of Lux Capital , who said that several of the companies he has invested in seriously considered tapping the loans , part of the Small Business Administration ’ s Payment Protection Program , which can be forgiven if companies use the money to pay employees .
But each time the startups thought they had overcome a legal or technical obstacle to be part of the program , another emerged , he said .
Now , out of five of his portfolio companies that likely @ @ @ @ @ @ @ just one that might take the money .
There ’ s a growing divide over the loan program in Silicon Valley , where small companies have already laid off tens of thousands of workers .
To stay afloat , some startups are moving ahead with the loans , despite a lack of clarity around the rules , and the potential for steep penalties if a recipient is found not to have met all the obligations .
Other companies are simply forgoing the money to avoid potential legal and reputational damage .
For the @ @ @ @ @ @ @ bid for a PPP loan , the process can be arduous .
The first step for many is finding out if they could be counted as an “ affiliate ” of one of their venture backers , which would disqualify them from the program .
Shedding that affiliate designation means getting rid of provisions in financing documents that allow a venture backer to veto decisions such as hiring key executive staff or major expenditures .
Dismantling such provisions is tricky but possible .
Mark Leahy , co-chairman of the startup and venture capital @ @ @ @ @ @ @ , says he has worked on changing control provisions for two startups that wanted to apply for the loans—although one decided not to proceed .
Although it ’ s complex , the process can be done in about 24 hours if necessary , Leahy said .
One particularly important update came last week .
Venture capitalist Chris Fralic had scheduled a noon board meeting on Wednesday with a portfolio company to discuss whether it should accept a loan .
Then , 10 minutes before the call , the Treasury Department released new guidance @ @ @ @ @ @ @ never forget where you were , ” the First Round Capital VC on joked the Twitter .
“ OJ verdict .
9/11 .
PPP clarification to question 46.
” The clarification reiterated that the government would conduct heightened scrutiny of loans over $ 2 million , but would presume that loans under that amount automatically satisfied the requirement of being “ necessary ” for the borrowers .
The update was good news for startups receiving smaller checks .
However , the Department of Justice could still investigate companies who took less than $ @ @ @ @ @ @ @ program ’ s labyrinthine rules were daunting for many startups .
“ The resources we had to deploy as a small business just to understand the benefits was so challenging , ” said Senreve Chief Executive Officer Coral Chung , whose business makes luxury handbags and was growing quickly until the pandemic struck .
She found herself poring over the details of the loans while also scaling back a product launch , rescinding a job offer , cutting her own salary , renegotiating rent with Senreve ’ s landlord and boarding up the @ @ @ @ @ @ @ because the business was in a strong position going into the crisis , and in part because of advice from VCs backing the company , she ended up deciding not to apply , she said .
“ Venture-backed startups are going to be scrutinized after the fact , ” said Nick Sturiale of Ignition Partners , who thinks the loans can only buy about two months of extra time for most companies .
“ Unless the company is facing imminent death , and this keeps death away from the doorstep , the cost @ @ @ @ @ @ @ extension.
” Take Foodsby Inc. , a Minneapolis-based marketplace for office lunches backed by Greycroft and others .
Business plummeted 90 % in late March due to the novel coronavirus .
Before the stimulus package was enacted , Foodsby CEO Ben Cattoor cut two-thirds of his staff .
He still envisions a bright future for the company , as people return to work and more businesses order individually boxed lunches .
It ’ s safer , he says , than asking employees go out or having staff serve themselves from open containers with @ @ @ @ @ @ @ those more prosperous days when workers get back to offices , Foodsby has to make it until then .
“ We took it .
We intend to keep it , ” Cattoor says about his PPP loan , which was more than $ 2 million .
But the CEO says he ’ ll also likely have to pay it back .
Unlike many startups whose loans will be forgiven , the bulk of his won ’ t be , he said , in part because he was forced to do layoffs before applying @ @ @ @ @ @ @ want to avoid PPP loans because of a perception they are intended for businesses like dry cleaners and family-run restaurants , rather than companies backed by venture capital .
Others argue that if the point of the program is to preserve employment and help small businesses overall , venture-backed companies should be eligible .
One startup that studied the program and decided not to apply is Textio Inc. , a Seattle-based startup that helps companies write more clearly and weed out bias .
“ We concluded that the program was not meant for @ @ @ @ @ @ @ Snyder .
She said the company reached the decision that PPP ’ s intended recipients were “ true small businesses , ” like local restaurants .
All Turtles , a San Francisco-based app development studio with 32 employees in the U.S. , received an $ 830,000 loan from the program last month , and is keeping the money .
“ I ’ m using it for its intended purposes , which is keeping people employed .
Otherwise , we would have had a harder time doing it , ” said founder Phil Libin @ @ @ @ @ @ @ startups to produce a lot of the innovation that ’ s going to get us past the crisis , so it would be bad for the world for startups to be excluded from public assistance.
” Libin , a former VC , said he hasn ’ t taken a paycheck in about a year and that his investors were supportive of the decision to keep the money to help avoid layoffs .
Companies have until June 30 to apply for a PPP loan .
One of Tan ’ s startups , accounting service @ @ @ @ @ @ @ for business and is now processing one-third the number of invoices it handled before the pandemic hit .
Plate IQ had its loan paperwork completed and ready to go , said CEO Bhavuk Kaul .
As of last week , he was still deciding whether to submit it .

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washingtonpost--2020-05-18--Treasury Has Spent Small Part of $500 Billion in Coronavirus Aid

About $ 454 billion of the $ 500 billion is intended for the U.S. Federal Reserve to create emergency lending programs for businesses .
Of that amount , the report said , $ 185 billion has been committed including $ 37.5 billion that has been sent to the central bank , which began purchasing some assets with the money last week .
Treasury Secretary Steven Mnuchin said in prepared testimony for Congress , released after the report , that as much as $ 195 billion in credit support has been committed .
He is scheduled to appear before a Senate @ @ @ @ @ @ @ Powell to talk about the rollout of the virus relief Cares Act .
The document was released even though the five-member panel still doesn ’ t have a chairman .
House Speaker Nancy Pelosi and Senate Majority Leader Mitch McConnell are supposed to choose that person jointly but have yet to announce an agreement .
The 17-page report outlines dozens of topics the panel intends to examine and updates the status of aid being provided , and also cited challenges in defining what indicates success or failure in the various programs The congressional @ @ @ @ @ @ @ broad approach to overseeing the funds to be disbursed by the Fed and the Treasury .
The group asked both agencies how their work helps the “ financial well-being of the people ” of the U.S. , and how it affects “ overall employment.
” The commission suggested that its members plan to hold the central bank and Treasury accountable beyond what is explicitly outlined in the legislation .
The report includes a series of questions for Treasury and the Fed about the implementation of the emergency lending programs .
They include queries @ @ @ @ @ @ @ to help implement the programs as well as whether the agencies believe they will break even on the programs .
“ If the agencies use economy-wide metrics , like GDP growth , unemployment rates , or wage growth , how will they isolate the effects of this program from other factors , including other federal and state relief measures ?
, ” the report said .
“ If the agencies use more narrow metrics , like bond spreads , how will they assess how changes in those metrics affect the broader economy ?
@ @ @ @ @ @ @ chosen by Pelosi , McConnell , Senate Democratic leader Chuck Schumer and House Republican leader Kevin McCarthy .
The members are Democratic Representative Donna Shalala of Florida ; GOP Senator Pat Toomey of Pennsylvania ; Bharat Ramamurti , a former aide to Senator Elizabeth Warren of Massachusetts ; and Representative French Hill , an Arkansas Republican .
The panel has a term of five years and is modeled after a similar temporary oversight commission that reviewed the Troubled Asset Relief Program following the 2008 financial crisis .
The oversight commission is one of @ @ @ @ @ @ @ of spending intended to help struggling airlines , corporations , main street businesses and hospitals as the pandemic has shuttered the economy .


washingtonpost--2020-04-08--Can’t Get a Rescue Loan? U.S. Banks Say Onerous Rules Are to Blame, Not Them

The issue is just one of a number of problems that have surfaced during the rollout of the $ 350 billion Small Business Administration lending program that began last week .
If left unresolved it could cause a major logjam in the effort , which the Trump administration has demanded move quickly to get cash to hundreds of thousands of companies teetering on the edge of closure .
“ Small businesses and policy makers should understand that a primary reason most banks will be extending these loans only to existing customers is because the anti-money laundering process is so onerous @ @ @ @ @ @ @ , president of the Bank Policy Institute , a Washington-based trade group for lenders that has been working closely with the Treasury Department and SBA .
“ Banks large and small have urgently sought relief from these requirements from day one , to no avail.
” To underscore its point , the industry estimates that even the initial steps of processing a new borrower ’ s application can add as much as two hours of work .
And then verifying that the customer ’ s information is legitimate can take a month or @ @ @ @ @ @ @ hardly a recipe for rapidly getting rescue funds out the door .
For borrowers , there ’ s a risk that much of the billions -- available on a first-come , first-served basis -- will be gone by the time their requests go through .
President Donald Trump said Tuesday that “ we will be running out of money very quickly ” and that he has asked Congress to add another $ 250 billion by the end of the week .
The target of banks ’ ire is the Financial Crimes Enforcement Network @ @ @ @ @ @ @ industry and the agency aren ’ t new , as lenders have long lobbied Congress to roll back some of its rules , many of which were put in place after the Sept. 11 , 2001 , terrorist attacks .
Coronavirus is giving firms a fresh opening to argue that FinCEN should be reined in .
A FinCEN spokesman pointed to a statement on the agency ’ s website that says it is “ committed to promoting the success ” of the new stimulus law , “ including the need to facilitate expeditious @ @ @ @ @ @ @ to issue additional guidance as the law is rolled out and questions arise , the statement added .
The SBA loan program , a crucial aspect of the government ’ s response to the virus-fueled crisis , is still a work in progress .
Treasury issued guidelines for participating banks only last Thursday , the night before they were slated to begin processing loans .
That in turn caused a number of banks , including some of the biggest like Wells Fargo & Co. , to say they couldn ’ t immediately participate @ @ @ @ @ @ @ expressed frustration over who ’ s getting funds .
Senator Marco Rubio , a Florida Republican , has flagged reports that banks were only lending to customers who had a credit card or had previously taken out a loan .
Maryland lawmakers , including Democratic Senator Chris Van Hollen , urged Treasury in a Tuesday letter to insist that applicants not be required to have existing relationships with banks .
Bankers said they had repeatedly warned the Trump administration that money-laundering rules would lead to problems with the so-called Paycheck Protection Program .
@ @ @ @ @ @ @ surprised that FinCEN has been so unresponsive to their concerns because it resides within Treasury , which has been the epicenter of the government rescue effort .
Treasury Secretary Steven Mnuchin , they said , has been very willing to cut red tape and address issues lenders have had that could slow down payouts .
The process is more complex for businesses .
Banks must check the identity of each person who owns more than 25 % of the company , as well as any person that has control of its operations .
@ @ @ @ @ @ @ as the standard information for individuals.The industry says obtaining these details can add between 40 minutes and 120 minutes to the application intake process .
And , depending on the complexity of the business ’ s ownership , it can require up to 30 more days for verification .
To speed things up , the banks have asked FinCEN to let them collect the customer information and verify it after the loan application is processed .
That would allow lenders to significantly cut the delays facing borrowers who don ’ t already have @ @ @ @ @ @ @ hasn ’ t granted the request , it did provide some relief in another area .
The agency issued guidance stipulating that banks providing the SBA loans don ’ t need to re-verify existing clients .
Still , that doesn ’ t help with new customers .


washingtonpost--2020-04-08--Congress Needs to Be Careful With ‘Hazard Pay’

Some of the policy suggestions are simply premature .
President Donald Trump says he wants the next package to include a substantial infrastructure component .
There is a logic to this : Interest rates are at all-time lows , and the economy will have spare capacity once the virus has largely passed .
And improving critical infrastructure can lay the foundation for economic growth and improve the government ’ s ability to respond to future crises .
Indeed , some states are already finding it difficult to carry out some of the policies from the last round of stimulus , @ @ @ @ @ @ @ antiquated .
To be effective , however , a huge infrastructure overhaul will require careful planning and the recognition that many projects will not be ready to go for months if not years .
Negotiations over what such a package would look like should certainly begin now , but rushing to pass a bill is not prudent from either a planning or relief perspective .
More crucial is an expansion of the Paycheck Protection Program for small businesses .
The goal of this program is to provide loans and grants to small businesses @ @ @ @ @ @ @ retain their employees during this period of extreme physical distancing .
This is a wise goal .
Yet it is already clear that the program isn ’ t big enough to meet the challenge .
The Small Business Administration is already having to ration the loans so that they cover only payroll and not ( as the law intended ) rent and other recurring costs .
Those loans would then be forgiven only if employers continue to employ all or nearly all their workers , thus providing a robust incentive to avoid layoffs @ @ @ @ @ @ @ costs , however , many businesses might be forced to lay off some workers anyway .
They then wouldn ’ t qualify for loan forgiveness — and knowing that , they might be reluctant to participate in the program .
There are other unintended consequences of this rapid-response lawmaking .
In the law , Congress provided extremely generous unemployment insurance benefits — in many cases making it possible for hourly workers to make more on unemployment than they would at their jobs .
That makes it difficult for employers to retain workers , @ @ @ @ @ @ @ .
To compensate for that , Congress may want to approve some sort of “ hazard pay ” credit program .
These credits would allow companies to give bonus pay to workers who stay on during the crisis .
In designing any such system , however , careful attention must once again be paid to both incentives and implementation .
Would furloughed workers be eligible for such pay ?
If not , then the problem of bringing back previously laid-off employees remains .
If so , then the U.S. will still be left @ @ @ @ @ @ @ are risking their health to provide Americans with essential services will be making less than those who aren ’ t reporting to work .
In either case , the U.S. faces the same long-term problem : It is putting an increasingly large portion of the economy on government support .
How will it withdraw that support when the crisis ends ?
If the support ends all at once , then the economy could experience a sudden crash in demand that could itself cause a new recession .
At the same time , the @ @ @ @ @ @ @ government help , the longer it will remain inflexible to the needs of a changing economic environment , and the slower the rebound in supply will be .
It ’ s possible that a gradual phase-out of government support could allow the economy to split the difference between collapsing demand and stifling supply .
Whatever the ultimate policy , it ’ s crucial to debate the incentive effects — and , just as important , not to caricature any discussion as a heartless attempt to obstruct much-needed coronavirus relief .
These are complicated @ @ @ @ @ @ @ to sort out .


washingtonpost--2020-04-08--Tears of Joy, 20-Hour Days: Virus Aid Trickles to the Desperate

The clock is ticking for millions of business people who have been forced to close under shutdown orders and face laying off employees and possibly going under in a matter of weeks or even days .
Despite the problems , Celtic Bank in Salt Lake City , Utah , closed 100 loans as of Tuesday , depositing money in the accounts of borrowers throughout the U.S. , according to Chief Executive Officer Reese Howell .
His staff has been working 18-to-20-hour days to manually process the loans , he said .
“ Yes , we have money flowing , ” @ @ @ @ @ @ @ that the bank would soon be able to automate much of the process .
“ I have customers call me in tears thanking me when they ’ ve received the money.
” The SBA ’ s coronavirus loan program got off to a rocky start Friday .
Lenders complained about not having enough guidance to process loans and problems connecting with the SBA ’ s system .
Some borrowers reported not being able to submit applications because they didn ’ t have an existing relationship with banks .
The SBA ’ s Paycheck @ @ @ @ @ @ @ 2 trillion stimulus package intended to shore up the economy .
It offers loans of as much $ 10 million that convert to grants if firms use the funds to keep workers on their payroll and maintain salaries .
Still , some small business owners did get money in their accounts the very first day .
Tanya Weinreis , who co-owns the Mountain Mudd Espresso coffee business in Billings , Montana , along with her husband , got news about her SBA loan approval at noon on Friday .
Two hours later she @ @ @ @ @ @ @ Yellowstone Bank with a check , she said , making hers the first business in the state to receive an SBA loan through the coronavirus stimulus bill .
“ It was the easiest loan I ’ ve ever gotten in my life and I ’ ve done a lot of loans , ” Weinreis said .
It was six pages of paper , she said , and it didn ’ t require a personal guarantee or collateral .
The loan kicked in at the right time , she said .
She ’ s @ @ @ @ @ @ @ 11 locations and hasn ’ t let any of her 50 employees go , even though she had one day when “ we sold $ 13 in coffee in a seven-hour shift.
” The 30 million small businesses in the U.S. employ half of the private work force , and many have been forced to close amid stay-at-home orders .
Almost a quarter of firms have shut down temporarily , and one in 10 are less than one month away from permanently going out of business , according to a poll released April @ @ @ @ @ @ @ .
The SBA said as of 4:30 p.m. New York Time on Tuesday , it has received more than 275,000 applications valued at $ 75 billion since the program went into operation .
That amount hasn ’ t been given to firms yet , but represents the value of loans SBA has registered and guaranteed for lenders to complete the process and disburse funds , according to a senior administration official .
Although President Donald Trump has said that the rollout has been “ flawless ” and had only a “ few glitches @ @ @ @ @ @ @ of problems , confusion and delays .
Lenders reported that E-Tran , the SBA system that lenders use to process loans , went down on Monday and has been overwhelmed .
The rollout “ has not been ‘ flawless ’ & the glitches have not been ‘ minor , ” ’ Republican Senator Marco Rubio of Florida , chairman of the Senate Committee on Small Business and Entrepreneurship , said in a tweet Wednesday disputing Trump .
“ But they also aren ’ t insurmountable .
They have solutions.
” Some banks were @ @ @ @ @ @ @ they lacked enough guidance from SBA and the Treasury about questions such as how payroll should be counted and how loans will be forgiven .
The Trump administration issued new guidance late Monday night that helped , Merski said .
A major concern is that some small businesses , especially mom-and-pop operations , could get shut out .
Borrowers also complained that they are being turned away from banks because they didn ’ t have an existing lending relationship with them .
Travis Powell , owner of the Best Western Plus Frontier Motel @ @ @ @ @ @ @ he ’ s reached out to about 32 lenders since learning the two local banks he works with aren ’ t participating in any SBA programs .
None are helping him , most because he doesn ’ t bank with them , he said .
“ It ’ s pretty crushing , ” he said , adding that many of the business owners in the 2,000-person town near Mount Whitney and Death Valley were in in the same boat .
“ We ’ ll have to wait in line behind businesses that are @ @ @ @ @ @ @ accounts .
”


washingtonpost--2020-04-08--Analysis | Saudi Arabia’s World Is Coming Undone

“ Disunited Nations , ” by geopolitics analyst Peter Zeihan , is a typically engaging read , but it is not a happy book .
Zeihan contends the postwar global order that rested largely on U.S. sponsorship ( or attention , at least ) is unraveling .
After seven decades of America suppressing humanity ’ s tendency toward general mayhem , more or less , with a muscular commitment to free trade and blanket security guarantees , a more Hobbesian future beckons .
Few countries have been shaped by the Pax Americana quite like Saudi Arabia , which gets its @ @ @ @ @ @ @ largely desert kingdom that emerged from clan warfare amid the ruins of the Ottoman Empire , it would have been a geopolitical backwater — except for its vast reserves of a certain vital commodity .
Even then , that would have made it more a target for bigger powers to swoop in than an independent actor .
But it just so happened that Saudi Arabia ’ s emergence as both a country and a major oil producer coincided quite closely with World War II and the beginning of the Cold War .
As @ @ @ @ @ @ @ pillars that defined the first nine decades of Saudi Arabia ’ s existence — the oil market and American protection — are crumbling .
Long-term growth in global oil demand is no longer a given , and Covid-19 is like a fever dream of all the worst aspects of that .
Meanwhile , U.S. ambivalence toward the Middle East has been supercharged by the debacle in Iraq and the shale boom .
Even if “ energy dominance ” has succumbed to its own inanity , U.S. dependence on Middle Eastern oil has diminished @ @ @ @ @ @ @ the need to keep it flowing to nominal allies .
While America ’ s continued enmity with Iran is welcome , the shrug given to September ’ s attack on the Abqaiq oil-processing facility was a reminder the world has changed nonetheless .
Saudi Arabia is trying to adapt .
Doing so would have been easier with oil at $ 100 rather than $ 30 .
Oil provides about two-thirds of the government ’ s revenue , and it has been running deficits for six years already .
According to Saudi Arabian Oil @ @ @ @ @ @ @ income tax and dividends to the state added up to about $ 208 billion last year .
This year ’ s take may drop by more than $ 100 billion , even with jacked-up oil production .
( 4 ) It ’ s hard to overstate the economic overhaul required .
Two-thirds of the national workforce ( as opposed to ex-pats ) is employed by the government , with wages accounting for about 40 % of public spending ( which makes budget cuts tough to propose and even tougher to execute ) .
@ @ @ @ @ @ @ , oil has brought enormous wealth , but at the price of economic dynamism .
One of the most striking aspects of this is how fuel subsidies have distorted Saudi Arabia ’ s own energy consumption .
This does not look like a healthy , modern economy entering a more carbon-constrained world .
( 5 ) A recent study of the fiscal models of Gulf Cooperation Council members published by the International Monetary Fund concluded that getting onto a more sustainable path would require an immediate adjustment equivalent to almost a third of @ @ @ @ @ @ @ ) .
In other words , these countries are writing checks their future generations can ’ t cash .
At the same time , American backing is diminishing .
It isn ’ t that the U.S. has withdrawn altogether ; more that , as threatening letters from senators have demonstrated once again , it can ’ t be depended upon .
In that light , the attempt to rope the U.S. into a brave new market-management scheme — call it OPEC-doubleplusungood — can be seen as an effort to preserve a much broader @ @ @ @ @ @ @ .
Far from prompting greater caution , Zeihan expects Saudi Arabia to respond to all this with aggression .
Sporting a relatively weak military and surrounded by the proxies of arch-rival Iran , Saudi Arabia ’ s strategy will be to exploit its primary adversary ’ s over-extension , using its wealth to fund opposing proxies of its own .
The idea being to light enough fires elsewhere in the region in order to avoid a direct , and likely devastating , war .
Zeihan calls this “ the geopolitics of arson.
” @ @ @ @ @ @ @ not a happy book .
But while that remains a scenario for now , it isn ’ t pure conjecture .
Saudi Arabia has long experience meddling in other conflicts from Afghanistan to Syria .
And it has already adopted a more aggressive foreign policy in Yemen and with regards to Qatar under the de facto leadership of Crown Prince Mohammed bin Salman .
The emergence of MBS , as he is called , represents a jump from the ruling family ’ s old generation to its millennial incarnation .
The ensuing centralization @ @ @ @ @ @ @ far more than just a symbolic break .
One of the most interesting aspects of this to emerge is his apparent embrace of populism , with his , ahem , anti-corruption round-up of fellow princes and easing of some restrictions on women being early examples of this .
In a fascinating recent article , Kristin Diwan of the Arab Gulf States Institute in Washington puts these moves in the context of a broader shift toward a more overt nationalism as a means of legitimizing the state .
This came to the fore in @ @ @ @ @ @ @ ended up being more of an exercise in national pride than mere fundraising .
Having encouraged citizens to borrow to buy the shares , the government has , Diwan writes : … effectively multiplied the public ’ s exposure to oil risk , amplifying the cost of the current downturn .
Still , it may not be the last sacrifice the Saudi state demands of its citizens .
If the economic situation further declines , the Saudi government is likely to lean further on the new nationalist narrative promoting a strong work ethic @ @ @ @ @ @ @ fair to say a headstrong ruler lacking institutional checks and fostering nationalist fervor to offset economic hardship is not a model that tends toward mellow outcomes .
It does , on the other hand , dovetail all too neatly with Zeihan ’ s vision of global fracture .
Oil bulls banking on Saudi Arabia to save the day this week should ponder what that means for the health of their market when this current crisis has passed .
( 1 ) This is based on a simple valuation tool I put together for @ @ @ @ @ @ @ assumptions for 2020 include net margins for downstream and chemicals operations of $ 1 per barrel and $ 100 per tonne and 95 % and 90 % utilization , respectively .
Includes $ 2.1 billion of free cash flow from Saudi Basic Industries Corp. , based on the consensus forecast and assuming 70 % ownership for two-thirds of the year .
Assumes natural gas production of 10 billion cubic feet per day and output of other liquids and ethane of 2.3 million barrels a day .
Upstream costs per barrel of oil equivalent @ @ @ @ @ @ @ .
( 5 ) “ The Future of Oil and Fiscal Sustainability in the GCC Region ” , International Monetary Fund , January 2020 .
Thisanalysis uses the Permanent Income Hypothesis .
This estimates each country ’ s total wealth and then modelslimiting expenditure to the estimated annuity value of that wealth while saving a significant portion of oil receipts in revenue-generating assets whose dividend income is meant to replace oil revenue in the future .
The authors found that , on average , the GCC countries would require an immediate fiscal adjustment @ @ @ @ @ @ @ economy in order for future generations to equally share the existing level of wealth .


washingtonpost--2020-04-08--Analysis | Luckin May Put Lasting Stain on China Inc. Listings

We have been here before .
After short sellers such as Muddy Waters , which bet against Luckin , spotted Toronto-listed Sino-Forest ’ s overstated timber assets in 2011 , Chinese listings in the U.S. evaporated .
But they eventually came back as tighter standards were put in place .
By 2014 , Chinese company IPOs in the U.S. hit an all-time high of $ 29 billion , buoyed by Alibaba Group Holding Ltd. ’ s record-breaking $ 25 billion deal — and reached its second-highest level in 2018 with $ 9 billion in listings , including that of Netflix-like @ @ @ @ @ @ @ a repeat of that comeback ?
Don ’ t count on it .
This time , a deeper freeze beckons for Chinese firms , one that will be hard to thaw even when the coronavirus outbreak opens up the U.S. IPO market again .
Here ’ s why .
First , Chinese IPOs aren ’ t the winning tickets they once were .
China-based companies that listed in the U.S. this year are trading at 12 % below their IPO price on average , while other new issues are down 7.5 % , @ @ @ @ @ @ @ .
That underperformance , which predated the Luckin scandal , makes it harder for investors to ignore the low accounting bar set on these listings in the U.S .
The U.S. Public Company Accounting Oversight Board , which was set up as a watchdog for audit firms in the wake of Enron Corp. ’ s collapse , can ’ t access the books of Chinese companies because Beijing deems that data to involve sensitive state secrets .
That hadn ’ t been a problem for shareholders as long as they were being compensated @ @ @ @ @ @ @ accepting the lack of transparency .
Now , though , investors will be less likely to take companies on faith .
That ’ s especially the case in light of Luckin ’ s situation .
Luckin ’ s rapid expansion , which allowed the three-year old company to reach 4,500 outlets and overtake Starbucks Inc. — a presence in the country since 1999 — had captured the imagination of not just retail investors in the U.S. but a slew of big names including Singapore ’ s sovereign wealth fund , GIC Pte , @ @ @ @ @ @ @ inflated numbers are going to lead investors to question all unprofitable Chinese firms with unsustainable models .
Second , Chinese listing hopefuls have alternative funding routes now : In 2018 , Hong Kong eased profitability requirements for new-economy listings , while Shanghai did so for candidates on its fledgling Star Market last year .
Meanwhile , index provider MSCI Inc. ’ s inclusion last year of mainland Chinese shares in its emerging-markets index means domestically listed firms no longer have to go to Hong Kong or the U.S. to access American money .
@ @ @ @ @ @ @ listing hopefuls also are shielded from both the class-action lawsuits Luckin now faces as well as the risk of getting caught in any trade war or other cross fire between Beijing and Washington , especially now with the virus outbreak escalating tensions .
In November , New York-traded Alibaba began what many are expecting to be the start of a wave with a $ 11.3 billion secondary listing in Hong Kong .
Lastly , the gatekeepers of IPO due diligence — the big audit firms and the Wall Street banks and others — @ @ @ @ @ @ @ Luckin ’ s unreliable revenue numbers for the nine months to Sept. 30 last year include those presented to investors during the May IPO .
Few will be assuaged by Ernst & Young ’ s statement that it tipped off the board to the fraudulent numbers while auditing the coffee chain ’ s 2019 figures .
Banks , too , will be ramping up their due diligence as the reputational risk they incur from advising Chinese company listings comes into focus .
Many of them face lawsuits , and underwriters will be keen @ @ @ @ @ @ @ .
Credit Suisse Group AG dropped off the $ 500 million-to- $ 1 billion IPO slated for later this year of WeDoctor — one of China ’ s top online health-care startups , backed by Tencent Holdings Ltd. — after the Swiss bank was sued for its role on Luckin ’ s U.S. share sale , Bloomberg News reported Monday .
Investment banks that dole out loans in the hopes of winning more IPO business will also think twice .
Six banks , including Goldman Sachs Group Inc. and Morgan Stanley , extended @ @ @ @ @ @ @ Luckin Chairman Lu Zhengyao and are now seizing and selling the stock after shares collapsed in the past week .
The banks stand to lose more than $ 100 million from that loan , according to the Wall Street Journal .
Beijing is also taking notice .
The China Securities Regulatory Commission has said it will investigate Luckin “ regardless of listing location , ” a rare move by the regulator , which tends to stick to its shores .
About 400 Chinese companies are listed in the U.S. with a total market @ @ @ @ @ @ @ by Alibaba , JD.com Inc. and Pinduoduo Inc. Luckin ’ s fake sales could easily cause that number to shrink .


washingtonpost--2020-04-02--Universities Step In to Sustain Local Businesses

“ I was worried how was I going to pay the rent , keep going and this and that .
That was a big help for us , ” said Michael Zoulis , part owner of the restaurant , which has been in his family since the late 1940s .
Tom ’ s still had to lay off 25 to 30 workers , he said , as business dropped when Gov .
Andrew Cuomo ordered almost all New Yorkers to stay home from work .
The relationships between colleges and college towns can be fraught .
Schools are typically exempt @ @ @ @ @ @ @ can be unruly .
But colleges need vibrant retail to make their communities thrive .
The absence of customers since campuses sent students home is a threat to commercial districts ’ survival .
So are government orders to close most nonessential businesses .
Colleges in the U.S. own about 20 million square feet of retail space , according to CoStar Group Inc. , a firm that tracks commercial real estate data .
While some of the wealthiest schools can step in to help , those with more modest finances may be fighting for @ @ @ @ @ @ @ tuition revenue are uncertain .
Williams is the richest U.S. liberal arts college , and Yale ’ s wealth ranks second only to Harvard ’ s among U.S. private universities .
“ Looking across all of retail , these owners and tenants and the lenders also all depend on each other , ” said Kevin Cody , a senior consultant at CoStar .
“ If one of them fails , the other two will be impacted by it negatively.
” “ Universities are less likely to have their financial stability dependent on income @ @ @ @ @ @ @ said .
“ They may be able to weather the storm more than other owners of retail.
” Columbia ’ s abatement is being offered to small , local businesses , most of the almost 350,000-square- foot portfolio , the school said .
The Ivy League school declined to say what financial loss it is absorbing .
Colgate sits in the village of Hamilton , population of about 6,000 .
About 20 years ago , the university began buying boarded-up empty buildings and created a corporation , Hamilton Initiative LLC , to run @ @ @ @ @ @ @ the initiative owns about 111,000 square feet across 10 buildings , and it has offered its 15 tenants a rent abatement for three months , said Daniel DeVries , a college spokesman .
They include a yoga studio , restaurants and a boutique .
It is costing the university about $ 100,000 .
Colgate ’ s endowment was $ 913 million as of March 2019.
“ We want to do whatever we can to help them through this time period because we want their doors open and we want them thriving once this @ @ @ @ @ @ @ Joanne Borfitz , associate vice president for community affairs and auxiliary services .
That includes FoJo Beans Coffee Roasters , which celebrated its first anniversary in February and sits on the ground floor of a red-brick building on the corner of Utica and Madison , main drags in town .
The roasting business set up shop there because “ Hamilton and the college wooed us in a way that we just couldn ’ t resist , ” said co-owner Dan Joseph .
“ The lure of continuous traffic was appealing.
” The three-month @ @ @ @ @ @ @ kitchen is closed .
The business is still shipping beans to customers and fulfilling a small amount of orders for brewed coffee and tea .
An area of the store has been turned into a mask-making station using Foust ’ s sewing machine .
The chocolate shop next door donated elastic.Coffee shops are seen as important to students , and to a sense of community .
One at Columbia also received an abatement : Dear Mama Coffee , on the ground floor in the Jerome L. Greene Science Center at Broadway and 129th @ @ @ @ @ @ @ , said he has some breathing room for April and May while the shop stays open to serve the sliver of the population that ’ s still working in the building .


washingtonpost--2020-04-08--Analysis | Tesco Has Every Right to Pay a Dividend

Britain ’ s biggest retailer has every right to reward its shareholders .
After all , unlike many companies crippled by the virus lockdown , it is doing well .
The supermarket operator has come through the dark days of 2014 when it discovered a 250 million-pound profit shortfall , and made one of the biggest losses in British corporate history .
Tesco on Wednesday announced underlying operating profit of just below 3 billion pounds in the year to Feb. 29 , 2020 , and said it generated just over 2 billion pounds of free cash flow .
Net debt @ @ @ @ @ @ @ down from 22 billion pounds as of February 2015 to 12.1 billion pounds .
That means it has no immediate need for extra cash , capital or liquidity .
The rub is that Tesco is accepting coronavirus-related relief from the government in terms of the 12-month holiday from business rates to the tune of 585 million pounds .
This is the property-based tax that Tesco Chief Executive Officer Dave Lewis and others have argued unfairly penalizes retailers with big store estates , and lets online competitors get off lightly .
Across Europe , @ @ @ @ @ @ @ payouts in order to preserve cash or in some cases to access government aid .
More than a sixth of firms in the benchmark Stoxx 600 Index have canceled or delayed dividends .
Tesco says any saving from the U.K. ’ s business rates will be outstripped by the extra costs it will incur to keep its stores open and treat employees well throughout the pandemic .
It predicts that they will ring in at a minimum of 650 million pounds , or as much as a worst case scenario of 925 million @ @ @ @ @ @ @ everything from providing full pay to sick employees , paying staff a 10 % bonus , recruiting 45,000 new workers and transferring others to where they ’ re needed most , as well as making changes to stores , such as installing screens to protect cashiers working the check out lanes .
Extra labor costs in stores and distribution centers will account for between 415 million and 580 million pounds .
And panic-buying ahead of the U.K. ’ s lockdown hasn ’ t benefited all of its aisles .
While Tesco has enjoyed @ @ @ @ @ @ @ rose about 30 % in the first few weeks of the crisis , clothing and fuel sales are down about 70 % .
Within Tesco stores , food is notoriously low margin .
The drop in demand for higher-margin furnishings and fashions , together with the higher costs , will have an impact on profit in this fiscal year .
Tesco says that as well as its staff , it is thinking about its investors — and there is likely to be some significant overlap between the two .
For several years after @ @ @ @ @ @ @ shareholders lived without a payout .
The company has been gradually rebuilding its dividend since February 2018 .
One option would have been to simply defer the dividend .
It could have been distributed at Tesco ’ s interim results in October , when feelings may not be running so high , or paid as a special dividend in 2021 .
After all , shareholders are already set to receive an exceptional dividend of 5 billion pounds from the sale the group ’ s Thai business , which it still expects to complete @ @ @ @ @ @ @ .
Tesco , along with Britain ’ s other big grocers , have done an admirable job in continuing to supply food , but also absorbing workers who have been laid off from other industries .
It would be a shame if this was overshadowed by the dividend decision .


washingtonpost--2020-05-12--Analysis | Paris Starts a Strange New Coronavirus Life

It ’ s encouraging that Paris and its surrounding areas are stirring to life after stay-at-home measures slashed footfall in stores and other entertainment venues by around 80 % , according to Google .
So-called “ revenge buying ” — pent-up demand for retail therapy after weeks of focusing on essential items and groceries — is happening despite ongoing social-distancing measures .
Shoppers were out looking for clothes , books , gadgets and the obligatory haircut , and they were even willing to brave larger retail outlets such as Zara and Fnac book and electronics stores , with lines 50 @ @ @ @ @ @ @ , tracked by TomTom , has hit levels not seen since March .
For every shop back open in Paris ’ s popular central districts , though , it looked like at least two or three were still shut .
That included big department stores such as Galeries Lafayette , but also movie theaters , restaurants and bars , which the government is keeping shut until at least June .
As with other cities easing lockdowns worldwide , the risk of a flare-up in infections has led to a very cautious approach .
@ @ @ @ @ @ @ cafe culture , or of epicurean delights where budding Hemingways are served St. James rum and oysters — it ’ s takeout or nothing .
Stoic acceptance of restrictions is the new Parisian philosophy .
Plenty of people now wear some form of face covering out in the streets even though they ’ re only really required to on public transport .
Green or white arrows on the floor of stores guide customers in order to avoid accidental human contact , and one million stickers regulate the flow of human traffic across the @ @ @ @ @ @ @ as a simulacrum of an Asian city that puts hygiene first ( with a few exceptions ) .
The hope is that in a few months ’ time , the city will recover its vim , provided fears of a new wave of infections fail to come to pass .
But the prospect of a smooth “ V-shaped ” recovery — one in which the economy bounces back from the low point of the lockdown — is looking increasingly remote .
France ’ s gross domestic product , of which the Paris region @ @ @ @ @ @ @ % in the first quarter — the worst reading since records began .
It ’ s expected to collapse 16.4 % in the second quarter , according to Bloomberg Economics .
If Parisians are still able to go shopping in this environment , it ’ s thanks to the state , which has footed the bill for 12 million French workers ’ furlough wages , or six out of 10 private-sector jobs .
That won ’ t last forever : At some point , when the worst of the health crisis passes and @ @ @ @ @ @ @ new normal , the state will expect companies to take on more of the wage burden .
It ’ s this transition from an economy on life support to one able to stand on its own two feet that will likely squeeze those masked shoppers and the businesses so desperately eager to serve them .
Some 40 % of consumers expect to spend less after lockdown , according to one survey .
At the same time , fixed costs will go up , as stores redesign their layout and equip their staff for @ @ @ @ @ @ @ services sector mean that almost 30 % of restaurants and cafes could go belly up , according to industry representatives .
In ordinary times domestic consumer demand would be bolstered by tourists pouring into Paris , but that escape valve isn ’ t there .
France ’ s 2 million Chinese annual visitors and 4 billion euros ( $ 4.4 billion ) in associated spending are nowhere to be seen , and their temples of commerce like the Mandarin-language duty-free Galeries Lafayette store lie empty .
Disneyland Paris , a tourist attraction on @ @ @ @ @ @ @ Tower , is also closed .
Rather than enjoying an epicurean summer , Paris could find itself confronting a Schumpeterian one of creative destruction as swathes of its economy go bust .
A hit to demand and supply , along with tighter credit conditions , would crush businesses and burst a real-estate bubble that has been expanding for years .
White-collar workers accustomed to remote working and fed up of apartment life after lockdown are already looking to buy homes with gardens outside Paris .
There are solutions on offer that policy makers @ @ @ @ @ @ @ the national or European level would limit the economic damage , while urban-planning strategies like the “ 15-minute city ” could make Paris more livable .
Until then , a lot depends on the virus — and revenge buyers .


washingtonpost--2020-05-12--Analysis | How Do You Shift $17 Billion of BlackRock Stock?

PNC has judged that it has better opportunities for its capital than continuing to ride the shift toward passive investing ( and market gains ) that BlackRock stock has provided .
After diving to $ 327 apiece during the March coronavirus rout , BlackRock ’ s shares closed on Monday at $ 493 — just shy of their 2019 high .
PNC doubtless doesn ’ t want to risk seeing another market correction when it can sell at these levels .
But for such a longstanding holder to be disposing of its entire stake sends a negative signal — even @ @ @ @ @ @ @ in its backyard .
It is in both PNC ’ s and BlackRock ’ s interests to work together to get this mammoth deal done .
BlackRock is issuing a prospectus .
This up-to-date snapshot of the business ought to provide investors some comfort that they know what they need to know .
BlackRock will buy $ 1.1 billion of the offering — a sign that it ’ s confident in itself and a move that usually boosts earnings per share .
It ’ s not clear whether the three investment banks involved @ @ @ @ @ @ @ Evercore Inc. — have guaranteed PNC a specific price on the block , or whether the terms will be the result of indicative orders now being placed by investors .
A hard underwriting commitment would be a brave thing in these markets , but there ’ s a price for everything .
Either way , much of the legwork of this transaction will have been done already .
It ’ s hard to believe the protagonists would have announced this move unless they ’ d lined up some interested parties , starting with @ @ @ @ @ @ @ to snap up a big stake in BlackRock without pushing up its share price while you ’ re doing the buying , as would happen when acquiring in the market .
That the shares barely budged in out-of-hours trading suggests the stock market isn ’ t anticipating indigestion .
The sale necessarily starts out as a collaborative process .
But as PNC will not remain a shareholder , its obligations are primarily to its own investors .
Its priority has to be getting the best price for this transaction .
BlackRock ’ s @ @ @ @ @ @ @ want a supportive and varied set of incoming shareholders and a stable share price once the deal is done .
There ’ s still potential for the two sides ’ aims to collide on a transaction this size .
This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners .
Chris Hughes is a Bloomberg Opinion columnist covering deals .
He previously worked for Reuters Breakingviews , as well as the Financial Times and the Independent newspaper .


washingtonpost--2020-05-12--Analysis | Equity-Raising Bankers Are on the Naughty Step

The question is whether the managers taking advantage of the changes really have no choice .
For example , Glass Lewis & Co. LLC and Institutional Shareholder Services Inc. aren ’ t convinced that real-estate agent Foxtons Group Plc and casual dining outfit Restaurant Group Plc needed their respective 22 million-pound ( $ 27 million ) and 57 million-pound cash calls so urgently .
Both companies are in businesses where revenue has been turned off , and there ’ s no doubting the wisdom of raising funds .
But neither appeared to be running out of cash when they did @ @ @ @ @ @ @ that the new system works pretty well for large , powerful shareholders .
A British firm ’ s top institutional investors form a small list that ’ s easy for an investment bank to get on the phone .
This select group can probably buy the bulk of a share offer by a mid-sized company whose stock price has fallen a lot .
Indeed , Foxtons and Restaurant Group defended their actions , citing institutional shareholder support and the need to plan for all scenarios .
It ’ s the individual shareholder who @ @ @ @ @ @ @ enjoy quick profits on the cash they put in .
Companies don ’ t need retail investors for their money , but excluding this constituency is unfair nevertheless .
Fortunately , technology is emerging that could help both parties .
Fintech PrimaryBid Ltd. provides a potential avenue for notifying smartphone-carrying retail investors about imminent cash calls in their directly held stocks , and enabling them to buy in if the company has made arrangements .
It ’ s not perfect : Regulations mean the retail component is capped at a few million pounds @ @ @ @ @ @ @ and PrimaryBid ’ s platform requires investors to take the price set by the institutions .
But adding a portion of retail , with solid investor protections , would mitigate the injustices of these cash calls at the cost of not much extra hassle .
Technology aside , companies can protect individual shareholders by keeping equity issuance as small as possible .
The fact so many firms are raising the full 20 % of their capital suggests they are grabbing more than they need just for the sake of it .
The temptation @ @ @ @ @ @ @ shareholders a big allocation at a lower , and more dilutive , price .
It may be legal — but reputations will suffer in the end .
This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners .
Chris Hughes is a Bloomberg Opinion columnist covering deals .
He previously worked for Reuters Breakingviews , as well as the Financial Times and the Independent newspaper .


washingtonpost--2020-05-12--Analysis | Pimco Is Managing to Do More With Less

Exhibiting masterly understatement , Chief Financial Officer Giulio Terzariol told Bloomberg Television , “ March was a tough month.
” Retail investors abandoned the market as the novel coronavirus threatened to trash the global economy .
Beneath the headline decline in assets under management — Pimco ’ s worst drop in the five years since the surprise departure of bond maestro Bill Gross , as noted by my Bloomberg News colleagues — the firm ’ s recovery continues apace .
That means Allianz will be dealing from a position of strength if it finally takes the plunge and decides to @ @ @ @ @ @ @ rival player .
In the current beleaguered environment , the one variable that asset managers are able to control is their costs .
As Pimco ’ s overall revenue grew by 18.4 % in the year , to more than 1.3 billion euros , the firm was able to shave almost a percentage point from its cost-to-income ratio , extending a trend of parsimony that ’ s been in place for at least the past five years .
Moreover , the margin Pimco is able to charge for managing other people ’ s @ @ @ @ @ @ @ given the fee compression that the rest of the active management industry has endured amid increased competition from low-cost index-tracking products .
While its first-quarter margin of 37.3 basis points was down a tad from December , it actually improved from 36.1 basis points in the year-earlier period .
A year ago , Pimco ’ s parent toyed with the idea of buying DWS Group GmbH , when Deutsche Bank AG was mulling offloading its remaining 80 % stake in the fund manager as part of its ultimately doomed attempt to merge with @ @ @ @ @ @ @ neither transaction happened .
But Allianz has given notice that it intends to be part of any industry consolidation .
At some point , the German insurer might want to bolster its fund-management defenses against the rise of the index trackers by buying a specialist in passive strategies .
With a market share of more than a quarter of Europe ’ s exchange-traded products , DWS may still prove attractive — if it ever comes up for sale .
This column does not necessarily reflect the opinion of the editorial board or Bloomberg @ @ @ @ @ @ @ is a Bloomberg Opinion columnist covering asset management .
He previously was the London bureau chief for Bloomberg News .
He is also the author of “ Complicit : How Greed and Collusion Made the Credit Crisis Unstoppable.
” For more articles like this , please visit us at bloomberg.com/opinion


washingtonpost--2020-05-12--Analysis | Hedge Funds, Go Home — Japan Is Closing the Door

Last Friday , Tokyo laid out details of new rules that restrict overseas investment through amendments to its Foreign Exchange and Foreign Trade Act , in a bid to preserve industries in the interest of national security .
A so-called core list includes giants like Toyota Motor Corp. and Softbank Group Corp. that amounts to 40 % of the benchmark Topix by market capitalization .
The government also spelled out much-awaited exemptions that establish whether outside investors are subject to the rules .
The effect is to add onerous hurdles to what had been an open market , nearly one-third @ @ @ @ @ @ @ of the daily turnover , according to Goldman Sachs Group Inc .
The changes underscore Japan ’ s sharp retreat from the encouraging reforms undertaken since 2015 .
They had been succeeding .
Shareholder proposals for auditor or director changes were up , as were returns .
Hedge funds such as Dan Loeb ’ s Third Point LLC and Paul Singer ’ s Elliott Management Corp. have all had their eyes on the likes of Sony Corp. and Softbank .
On Tuesday , London-based activist Asset Value Investors Ltd. took on elevator and @ @ @ @ @ @ @ and returns.A fairly liquid market had meant foreigners could choose where they put their money without needing to consider the extra layer of regulations for participation and if companies were subject to them .
Now , under the new rules taking effect June 7 , any overseas investor who wants to build a stake of more than 1 % needs to notify regulators , a severe tightening from the previous 10 % .
Who wants to seek approval well before investing and be hamstrung on timing ?
Most foreign money managers will have @ @ @ @ @ @ @ with certain conditions .
The caveats effectively shut out activists : Investors can ’ t become board members and they can ’ t propose spin-offs at general shareholder meetings .
Other large managers can be exempted if they don ’ t join board committees or issue written proposals with deadlines .
Otherwise , they can go big .
Tokyo is signalling that it wants passive investors to hold up its market , very little accountability , and to give Japanese companies a heads-up if cantankerous hedge-fund action is coming .
Ostensibly , the @ @ @ @ @ @ @ .
They ’ re in line with the global trend to strengthen measures for screening foreign direct investments , according to the Finance Ministry .
But they also include operators of hot springs and makers of fountain pens .
In reality , the list is a way to disregard governance oversight .
The wide reach of the law is telling : Of the 10 largest companies on the Tokyo Stock Exchange , seven fall into the core category .
Healthcare and pharmaceutical companies , which currently have a small weight , are expected @ @ @ @ @ @ @ the viral outbreak increases .
That ’ s also a sector hedge funds are active in .
Covid-19 is already pushing Japan ’ s big , cash-hoarding companies into self-preservation mode and is benching activists .
Earnings per share are expected to decline by as much as 18 % over the next fiscal year , with Goldman Sachs foreseeing extraordinary losses to total 8 trillion yen ( $ 74 billion ) over fiscal 2019 and 2020 .
The new rules will make this worse , dashing the prospects of change at progressive companies @ @ @ @ @ @ @ certain types of activist hedge funds onto their boards .
With expectations for growth or even catalysts missing , valuations will struggle .
The benchmark Topix 500 has traded at a discount to the S & P 500 for much of the last decade .
Shareholder returns are heading down , too .
The announced value of stock buybacks has fallen almost 30 % between January and April , compared to the previous year .
Japanese companies now have even more reason to hold back on payouts .
They tend to keep dividends @ @ @ @ @ @ @ the air , that may be difficult .
Older people account for 75 % of household equity holdings .
If big investors lose interest , the sag in value will drag down these ordinary shareholders , too .
The negative wealth effect will trickle through an economy already struggling to boost consumption .
No matter how often it has disappointed , Japan has always had a top place in the minds of foreign investors .
It will be harder to justify now .
Hedge funds and other investment managers may find it ’ @ @ @ @ @ @ @ .
After all , Japan Inc. doesn ’ t want to hear from them .


washingtonpost--2020-05-12--Trump’s Go-Slow Path on New Aid Runs Into Rising Pressure to Act

Republicans and Democrats joined together in March to fast-track three stimulus measures totaling about $ 3 trillion as the economy collapsed from social-distancing practices Americans adopted to protect themselves from infection .
The U.S. Federal Reserve played its part with two emergency rate cuts , and worked with Treasury to offer $ 2.3 trillion in loans .
Democrats and a handful of Republicans are seeking a fourth round of stimulus , particularly to help states faced with massive budget deficits .
House Speaker Nancy Pelosi , working with Senate Democrats , has been advocating a massive aid package to get @ @ @ @ @ @ @ vote on that legislation as soon as Friday .
“ We ’ re transitioning to greatness , and the greatness is going to be in the fourth quarter -- but it ’ s really going to be next year , and it ’ s going to be a year like we ’ ve never had before , ” Trump said at a White House news conference on Monday .
The measures the government has already taken are still working their way into the economy .
Treasury Secretary Steven Mnuchin has so far used @ @ @ @ @ @ @ Congress authorized as backstops for Fed lending programs .
He ’ s said he ’ s waiting for four more lending programs the Fed has yet to launch before deciding which ones should be expanded .
“ What the president has said is , let ’ s step back for a few weeks , let ’ s be very considerate in what we do in the next round before we go consider spending another trillion , ” Mnuchin said in an interview on CNBC on Monday .
“ But the president is determined @ @ @ @ @ @ @ to do.
” But a Republican senator , Josh Hawley of Missouri , has called for a fourth stimulus that would provide 80 % of payroll for all U.S. workers for the duration of the crisis .
Another Senate Republican , Susan Collins of Maine , aligned herself with Democrats on the issue last week , calling for swift action to aid states .
“ If this is going to go on for a long period of time –- I think it ’ s going to go on in some phases for a @ @ @ @ @ @ @ is going to need to continue to give assistance to workers who ’ ve lost their jobs , ” Federal Reserve Bank of Minneapolis President Neel Kashkari said Sunday .
Fed Chairman Jerome Powell , while not commenting directly on fiscal policy , weighed in earlier this month saying now is not the time to worry about the federal deficit .
“ This is the time to use the great fiscal power of the United States , ” Powell said , “ and get through this with as little damage to the longer-run @ @ @ @ @ @ @ ” There ’ s pressure in conservative circles , however , to rein in or even stop the spending .
White House Chief of Staff Mark Meadows , a former North Carolina congressman and co-founder of the House Freedom Caucus , and Russell Vought , the director of the Office of Management and Budgett , have expressed unease with spending levels , two people familiar with the situation say .
Other conservative figures have publicly called for a halt .
“ No more , not a dime more , ” he said .
@ @ @ @ @ @ @ Do what you did that actually rebuilt the economy back in 2017 .
Cut taxes , reduce regulation , provide a liability shield for businesses so they can hire their workers back , and let ’ s grow the private sector , not the government.
” “ I ’ ve talked to him twice about this .
He keeps saying , Steve , can you get Nancy Pelosi to go along with that ?
” Moore said .
Trump has even floated the notion of a permanent cut , which would deliver another @ @ @ @ @ @ @ don ’ t think that ’ s going to be a constructive start , ” Yuval Levin , director of social , cultural , and constitutional studies at the right-leaning American Enterprise Institute , said of the Democratic proposals .
“ But I also think the Republican view , that you can sit it out and wait and see how it goes , that ’ s not going to survive very long , either , ” he said in an interview .
“ Many people would like to just pause for a moment @ @ @ @ @ @ @ impact of this massive assistance program , which is the greatest in United States history , ” Kudlow told ABC on Sunday .
“ After all this assistance , let ’ s have a look at what the impact is in at least the next couple of weeks for the economy .
”


washingtonpost--2020-05-12--Analysis | This Cozy Airline Carve-Up Is a Pandemic Chimera

It ’ s not hard to see the attractions .
IndiGo ’ s home market is fiercely competitive , with half a dozen major carriers duking it out even after Jet Airways India Ltd. was forced into bankruptcy last year .
Jet was squeezed between the loss-making full-service flights offered by state-owned Air India Ltd. and IndiGo ’ s own devastatingly cheap fares .
Australia , on the other hand , is more or less a duopoly between Virgin Australia — which was itself put into a coronavirus-induced administration last month — and a dominant Qantas Airways Ltd. That should @ @ @ @ @ @ @ to cozily carve up the market between themselves .
Opportunities to break into the Australian airline game don ’ t come along often .
The last time was when Ansett Australia Ltd. collapsed just days after the Sept. 11 attacks .
A fledgling Virgin Australia , at the time a budget carrier named Virgin Blue , was perfectly placed to capitalize .
Despite the vast disparity in population , Australia isn ’ t that much smaller than India as a market , thanks to greater wealth and a higher propensity to fly .
@ @ @ @ @ @ @ billion revenue passenger kilometers , roughly the size of the fast-growing Indian aviation market five years ago .
It also has close links to India , raising the prospect that an Australian network could feed passengers via international flights into IndiGo ’ s domestic web of destinations .
Indian-Australians make up close to 2 % of the population , and the number of non-resident Indians — the subset of the diaspora who are most likely to take regular flights back to the motherland — is the largest after the U.K. , U.S. , @ @ @ @ @ @ @ Gulf countries .
( 1 ) For all that , Bhatia should pass up the chance to have a crack at Virgin Australia .
In its ruthless efficiency in controlling its home turf , Qantas behaves a lot like IndiGo , one reason that Australia has for a decade been a graveyard for ambitious foreign airlines .
His best opportunities lie closer to home .
Both Qantas and IndiGo exploit a rare and priceless phenomenon known as the S-curve , by which dominant airlines end up with more connections and a greater share @ @ @ @ @ @ @ .
That makes life extremely difficult for competitors .
Singapore ’ s attempt to set up a bridgehead via an outpost of its budget carrier Tiger Airways Holdings Pte .
ended up being sold to Virgin Australia back in 2014 at a valuation of A $ 2.50 ( $ 1.62 ) , after years of struggle .
AirAsia Group Bhd .
showed fitful interest in establishing a bigger presence Down Under , but ended up mostly steering clear .
Virgin Australia itself spent years trying to break the Flying Kangaroo ’ s dominance @ @ @ @ @ @ @ .
Ordinary shareholders hold less than 10 % of the now-worthless stock , with the balance being held by a rotating cast of carriers including Etihad Airways PJSC , Singapore Airlines Ltd. , Hainan Airlines Holding Co. , Qingdao Airlines , Air New Zealand Ltd. , and Richard Branson ’ s Virgin Group itself .
Their indifference to profits enabled Virgin to compete against Qantas for longer than many would have thought possible , but it hasn ’ t been enough to win the battle .
The distance between Australia and India is @ @ @ @ @ @ @ markets an easy play , too .
IndiGo ’ s aircraft of choice is the Airbus SE A320neo , which some budget carriers have been using to open up longer-range routes — but it would be operating at its limits even on flights between India and Perth , which is a long way from Australia ’ s more populous east coast .
That would necessitate Bhatia either using an unfriendly hub airport in Southeast Asia , or investing in bigger , more expensive twin-aisle jets .
IndiGo is so powerful in its home @ @ @ @ @ @ @ owners should be looking at overseas expansion — but as we ’ ve argued , the better place for that is in the Persian Gulf , where a far bigger Indian diaspora is closer to home and largely flown across the Arabian Sea on Gulf carriers such as Emirates .


washingtonpost--2020-04-28--Bank of America Sends 184,000 Applications for Small-Business Loans to SBA

“ Today , we will communicate to each client whose application has been submitted to the SBA , advising them the loan application has been submitted , and we will notify each client promptly when the SBA has acted on the application , ” Athanasia wrote .
“ We expect that will take several days at the earliest based on what the SBA is telling us.
” Bank of America is among the big U.S. lenders that have faced criticism from longtime clients who ’ ve tried to get SBA applications processed to weather the coronavirus pandemic , with many @ @ @ @ @ @ @ problems with their loans .
The bank is being sued , alongside Wells Fargo & Co. , JPMorgan Chase & Co. and US Bancorp , for prioritizing large loans and shutting out the smallest firms .
The Trump administration said it ’ s approved more than $ 52 billion in loan requests for small businesses so far in the relaunch of the coronavirus relief program .
The SBA program , launched April 3 , has been beset by delays and glitches after guidance on how to process loans wasn ’ t released until @ @ @ @ @ @ @ weren ’ t ready to participate or held back until rules became clearer .
Bank of America was the first lender to take applications .
Only 1,000 of its latest 184,000 requests have received loan numbers from the SBA , which are required for the loans to be funded , according to a person familiar with the situation .
More than half of the customers who received SBA loan numbers Monday have been funded , with the remainder in process today , Athanasia wrote in the memo .
Bank of America has processed @ @ @ @ @ @ @ .
Of those , 98 % were for companies with fewer than 100 employees , while 76 % were for companies with fewer than 10 staff , Athanasia wrote .
Submissions for less than $ 350,000 accounted for 93 % of the total , while 78 % of applications were for less than $ 100,000 .
Eight out of 10 requests were for the lender ’ s small-business clients , as opposed to larger firms .
For more articles like this , please visit us at bloomberg.com


washingtonpost--2020-04-28--Analysis | At Last, an HSBC Wound That Isn’t Self-Inflicted

Bad as they may be , the results can hardly come as a shock when efforts to contain the Covid-19 outbreak have shut down swathes of the global economy .
Banks from Citigroup Inc. to JPMorgan Chase & Co. have reported large provisions for bad loans because of the economic impact of the virus .
HSBC shares remained higher in Hong Kong trading after the results , though they pared morning gains .
Things could be worse .
HSBC ’ s radical overhaul , announced with its fourth-quarter results in February , makes the bank even more hostage to the @ @ @ @ @ @ @ , two economies struggling with the coronavirus outbreak , I noted at the time .
Two months on , that looks like more of a strength than a vulnerability .
China is returning to work , while in retrospect Hong Kong has contained the outbreak relatively well .
The epicenter of the pandemic has swung to Europe and then the U.S. , to devastating effect .
Even the eye-watering level of provisions is a testament to an underlying strength at HSBC , as Bloomberg Intelligence analyst Jonathan Tyce observes .
With a core @ @ @ @ @ @ @ , the bank can afford to be conservative in setting aside funds for the tough times that lie ahead .
Parts of that ill-timed restructuring program , announced when then-acting Chief Executive Officer Noel Quinn had yet to be confirmed , are now on hold at least until the end of the year .
The bank is sticking with the overhaul , though , which includes 35,000 job cuts , a reduction in investment banking and a continuing pivot to Asia .
That strategic choice may yet be vindicated .
Hong Kong and @ @ @ @ @ @ @ recovery , Quinn said Tuesday in his first results announcement as permanent CEO .
HSBC ’ s revenue from Hong Kong rose a better-than-forecast 3 % compared with the fourth quarter , according to analysts at Citigroup .
That underlines how the strongest banks can benefit from a flight to quality in bad times .
If banks retreat from Asia in the way that many European players did during the global financial crisis , HSBC will have a chance to deepen its ties in the region and pick up pieces of the supply @ @ @ @ @ @ @ Clients are likely to favor the large corporate banks with a global footprint such as HSBC , Citigroup and Standard Chartered Plc .
HSBC is Asia ’ s top corporate bank , with a 59 % penetration of the market , according to data from Greenwich Associates .
The bank can ’ t escape responsibility for everything that has gone wrong .
The $ 600 million that HSBC is owed by troubled Singapore oil trader Hin Leong Trading ( Pte ) Ltd. is a reminder that expansion in other Asian markets carries pitfalls @ @ @ @ @ @ @ biggest exposure of 23 banks that have lent to Hin Leong .
It ’ s telling that DBS Group Holdings Ltd. , Singapore ’ s biggest bank , is owed only $ 290 million .
HSBC ’ s results are hardly cause for wild celebration .
In a landscape that ’ s largely bereft of good news for banks , though , there are worse places to be .


washingtonpost--2020-04-28--Gig Workers Get Help as Fiscal Stimulus Catches Up With Times

With governments bracing for economic contractions and joblessness not seen since the Great Depression , more of them are doling out part of their $ 8 trillion-plus stimulus to prop up the gig economy -- supporting part-time and freelance workers who generally lack a safety net .
Countries like the U.K. , U.S. , France , Singapore and Australia are going well beyond the fiscal aid delivered during the 2008-09 financial crisis to target a part of the labor market that now makes up one-third of the global workforce , according to estimates from the International Labour Organization .
The @ @ @ @ @ @ @ have also allocated support for self-employed people .
It ’ s in part an acknowledgment of the change the labor market has undergone in the past decade as gig jobs surged with the emergence of digital platforms like Uber Technologies Inc. and Airbnb Inc. For governments , the programs are an additional cost pressure on stretched budgets , but ignoring this key part of the workforce would have dire consequences for peoples ’ livelihoods and the wider economy .
“ Considering the number of self-employed people in total employment , their economic contribution @ @ @ @ @ @ @ in informal sector -- if they do not receive targeted support , the economic and social outcomes would certainly be more devastating , ” said Dragan Radic , the head of the small and medium-sized enterprises unit at the Geneva-based ILO .
But even in parts of the developed world , self employment has grown faster than overall employment , with countries already facing calls before the virus to update their social protection models .
In France and the U.K. , the share of the workforce who work for themselves , are members @ @ @ @ @ @ @ unpaid family workers rose from 2007 to 2018 , according to data from the Organisation for Economic Co-operation and Development .
Australia is offering A $ 1,500 ( $ 969 ) a fortnight for as much as six months for self-employed whose revenue is likely to drop by 30 % or more .
In Singapore , the government estimates that 100,000 self-employed persons will receive cash payments of S $ 3,000 ( $ 2,114 ) each in May , July and October .
And in Japan , where the self-employed make up about @ @ @ @ @ @ @ freelancers can claim as much as $ 9,300 from the government if they can show a minimum 50 % loss of income in at least one month .
For all the billions of dollars thrown at this sector of the labor market , the rollouts have not been without their hiccups .
Among the snags : • The U.S. , with its patchwork of 50 state policies around distributing government aid , is dealing with mass delays and confusion , on top of charges that self-employed were crowded out of funding claimed by @ @ @ @ @ @ @ a program to pay the self-employed the same proportion of their average annual earnings from the past three years is taking some time to get set up , with payments promised by early June • In Switzerland , some workers like taxi drivers were belatedly added to the program since they were initially seen as not legally forced to stop working -- which hindered their eligibility In Singapore , Paul Lew is running an online business selling wine and is setting up another website to sell medical products .
He ’ s received @ @ @ @ @ @ @ that the government has paid all Singaporeans , and is considering whether and how he should apply for additional support .
He ’ s not worried about his own finances for now -- he says he always keeps a “ tight ” control on what he spends -- but believes the extra support is vital for the self-employed and small businesses in Singapore .


washingtonpost--2020-04-28--Analysis | Managing Money for the Wealthy Really Pays Off

Just as the lockdowns are hurting some parts of the economy more than others , Europe ’ s largest lenders will struggle to varying degrees .
Most are grappling with mounting loan losses and some pressure on revenue .
Things will get tougher for everyone .
UBS , the world ’ s leading wealth manager , might be in a less worrying place than some of its peers , however .
Profit in the first three months of 2020 jumped 40 % to $ 1.6 billion as rich individuals and institutional investors increased their trading with the firm .
What @ @ @ @ @ @ @ aside just $ 268 million for loans that may go bad .
That ’ s much smaller than the provisions made by other large banks , but it reflects the modest size of the UBS loan book , made up largely of mortgages ( sold to Swiss clients for the most part ) .
Loans to its wealthy clients , which are mostly backed by securities , saw some margin calls in the quarter but losses were contained .
Ermotti ’ s pivot to the rich looks shrewd .
Even if things don @ @ @ @ @ @ @ .
Losses on loans to oil companies would rise by $ 250 million if West Texas Intermediate crude prices stayed at $ 10 .
More generally , under the bank ’ s current model of economic stress , UBS would have another $ 470 million of charges if it assumed losses on healthy loans too .
That ’ s manageable .
While trading activity is slowing and fee income will probably decline as clients sit on more cash , Ermotti didn ’ t cut UBS ’ s targets .
In the first quarter @ @ @ @ @ @ @ common equity Tier-1 capital reached 17.7 % .
The bank aims for between 12 % and 15 % .
Elsewhere , the situation looks more bleak .
Spain ’ s Banco Santander SA is setting aside 3.9 billion euros ( $ 4.2 billion ) for loan losses , cutting its profit by 82 % in the quarter .
Its diversification across 10 core markets from Brazil to Poland isn ’ t much of a shield in a global pandemic .
The Spanish bank ’ s exposure to small- and medium-sized businesses , and @ @ @ @ @ @ @ helping .
Loan-loss provisions have soared while business has nosedived .
New consumer lending in Italy and Spain fell to between 10 % and 20 % of its usual level once the lockdowns kicked in .
Santander ’ s underlying return on tangible equity dropped to 11.1 % in the quarter , well below its medium-term target of between 13 % and 15 % .
Chairman Ana Botin had seemed confident that her bank could weather the crisis with a 5 % decline in earnings in a V-shaped economic recovery ; on Tuesday @ @ @ @ @ @ @ review its strategic targets .
Credit losses are also piling up at HSBC Holdings Plc , an Asia-focused European lender , which is taking its biggest charge for bad debt in almost nine years .
Provisions of $ 3 billion in the first quarter led to a 51 % slump in adjusted profit .
HSBC set its range of potential credit losses for the year at between $ 7 billion and $ 11 billion .
“ Part science , part art , ” is how HSBC ’ s chief financial officer described his @ @ @ @ @ @ @ The banks ’ second-quarter earnings will provide a clearer picture of the winners and losers , and yet more lending support from regulators could soften the blows .
But UBS ’ s expensive decision after the financial crisis to move away from capital-intensive lending and trading is paying off .


washingtonpost--2020-04-28--Analysis | Autos Are Driving in the Chip Industry’s Blind Spot

The Dutch company said revenue will drop approximately 20 % this quarter to around $ 1.8 billion .
The figure is in line with estimates that analysts slashed by 23 % over the past eight weeks .
NXP cut its first-quarter revenue estimate at the start of March , only to fall short of that mark .
The company forecast a second-quarter operating loss of as much as $ 237 million , versus an estimated deficit of $ 169 million .
So far this year , much of the attention in semiconductors has been on whether smartphones are a necessity @ @ @ @ @ @ @ disagree — and whether work-from-home and streaming demand will drive server sales enough to make up for the drop in consumer spending .
The outlook from Taiwan Semiconductor Manufacturing Co. suggests otherwise .
NXP , however , is playing in a different arena : It got 47 % of its revenue from automotive clients last year .
The company said Monday that it was “ navigating a challenging and very fluid environment.
” That ’ s an understatement .
After a 4.5 % decline in global automobile shipments in 2018 and a 3.9 @ @ @ @ @ @ @ the industry might avoid a third year of contraction are out the window as the Covid-19 pandemic hits demand and supply .
NXP isn ’ t alone .
Germany ’ s Infineon Technologies AG gets 43 % of its revenue from the auto sector .
This month , the company completed its $ 9.3 billion ( 1 ) acquisition of California ’ s Cypress Semiconductor Corp. You ’ ll never guess which sector accounts for 39 % of that company ’ s business .
Forgive Infineon shareholders if they start to feel that @ @ @ @ @ @ @ Cypress might be a little steep .
Ironically , shareholders seem to be forgiving management , with the stock rebounding from a mid-March low to be 30 % off its February peak , and back to where it was in early October .
Bloomberg Intelligence senior analyst Anand Srinivasan has been ahead of the curve .
He predicted two weeks ago that the then-consensus estimate for a 4 % decline in NXP revenue this year was conservative , and that 6 % might be more realistic .
Today , data on the Bloomberg @ @ @ @ @ @ @ , the worst since the financial crisis in 2009 .
At Infineon , analysts are looking at a 7 % drop in sales for the year ending Sept. 30 .
That may also be conservative .
Xiaomi may believe that smartphones are a must-have , and Apple Inc. certainly hopes that its new iPhone SE will find favor even among tight-fisted consumers .
But with a global recession on the way , you ’ d have to be Elon Musk to believe that the auto sector , and the chipmakers that supply them @ @ @ @ @ @ @ minor bruising .
This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners .


washingtonpost--2020-04-27--Business of Survival Fuels Race for New Skills to Stay Afloat

It ’ s all part of a bigger battle for the business .
With hundreds of thousands of pounds of orders postponed , the maker of bespoke retail and commercial interiors is entering the health care sector in hopes of getting through the crisis .
Staff there are just some of the workers racing to learn fresh skills as the coronavirus crisis triggers millions of jobs cuts and threatens the deepest recession since the Great Depression .
More than 1 billion workers are at high risk of a pay cut or losing their position , according to the International Labor @ @ @ @ @ @ @ during the pandemic comes amid a more general need for repositioning as technology fundamentally alters the workplace .
The World Economic Forum had already estimated that at least 54 % of employees in major economies will need reskilling or upskilling by 2022 if they ’ re to be ready for technological advances .
Employees lucky enough to have kept hold of their jobs in recent weeks are mastering virtual working or taking on new tasks as their companies seek alternative business in a global economy turned upside down .
Those laid off are @ @ @ @ @ @ @ make use of their enforced time at home .
The broad shift means that a traditional school education is no longer serving people for their lifetime .
The U.K. ’ s Industrial Strategy Council has warned that up to two thirds of workers could fall short of even the basic digital skills required by 2030 , meaning many will need to embrace the concept of lifelong learning to stay relevant .
At Zero Point 8 in Dudley in the U.K. Midlands , immediate concerns meant teaching staff to manufacture transparent “ sneeze screens @ @ @ @ @ @ @ of acrylic -- a material that only one worker previously had the knowhow to handle .
“ We have employees here that have had to learn , ” Chief Executive Officer Mark Baker said .
“ It was a very small part of what we did , but it ’ s now become very large in the last week.
” Access to training isn ’ t easy for everyone , particularly lower paid workers and those without social security nets .
Income losses will be above $ 220 billion in developing countries , @ @ @ @ @ @ @ global population have no social protection , according to the United Nations .
While Lam is not letting workers go , he is looking for savings where he can .
“ It is the worst situation I have ever seen , ” he said .
For freelancers , the problem is just as acute .
The FRED company , a London-based creative agency , started seeing corporate photoshoots canceled as early as February , meaning no work for the people it usually hires .
Instead , they ’ re using their time to @ @ @ @ @ @ @ of digital work and online conferences .
“ Everybody is learning anything they can , ” said Creative Director Rosie Collins .
“ I ’ ve got three artists coming back to me at the moment saying ‘ I now know how to use this program , or this program if you need it.
” ’ The accelerated push for new skills comes as jobs are shed everywhere .
U.S. jobless claims are running at 15 times their average this century .
In the U.K. , claims for Universal Credit welfare benefits have @ @ @ @ @ @ @ Mullein and Sparrow , a Brooklyn-based vegan skincare company , had spent eight years getting her business exactly where she wanted it when it was all shaken up by Covid-19 .
About 80 % of sales are wholesale , but widespread retail closures has seen that drop to nearly zero .
She and her staff of four had to immediately pivot , shifting to online-only and selling directly to consumers .
She increased advertising on Facebook and Instagram , and now analyzes traffic to her website in her spare time .
She and @ @ @ @ @ @ @ marketing and social media advertising using online seminars and tutorials on Shopify Academy , the platform that hosts her website .


washingtonpost--2020-04-28--Analysis | BP’s Love of Dividends Is Bordering on the Absurd

BP ’ s revenue fell sharply during the first quarter as the pandemic curbed industrial demand for oil and chemicals , lockdowns cut transport and a Saudi Arabia-led price war exacerbated the impact on oil prices .
Operating cash flow was $ 1 billion , compared with $ 7.6 billion in the final three months of 2019 .
In response to the crisis , the company is saying the right things about strengthening its finances .
It is amassing cash from anyone who will lend it , raising $ 7 billion in the bond markets and obtaining a $ 10 @ @ @ @ @ @ @ cutting capital expenditure this year by 25 % and it will reduce operating costs by about $ 2.5 billion by the end of 2021 .
There ’ s only so much BP can cut , however , so its net debt has shot up and the company is now saying its overall leverage , measured as net debt to total capital , will be above its 20 % -30 % target range into 2021 .
And yet , the quarterly dividend stayed at 10.5 cents per share , after being raised last quarter @ @ @ @ @ @ @ three months of $ 2.1 billion .
While dividends are meant to be discretionary , BP ’ s have taken on an unshakable status .
Every operating measure and financial target appears to work around them , even as the oil giant talks about the need to strengthen its balance sheet .
Chief Executive Officer Bernard Looney ’ s defense is that the payout was reviewed by the whole board and is supported by the “ underlying performance ” of the business .
Yet even when adjusting for working-capital movements , squeezing the @ @ @ @ @ @ @ about $ 3 billion out of operating cash flow is going to be tight this year .
How does this support the big strategic challenge facing BP : the need to invest in the energy transition ?
Looney is promising more details on BP ’ s green plans later in the year .
For now , it ’ s hard to be optimistic .
The company ’ s renewed cost-cutting zeal means it can break even at low crude prices , though not as low as today .
As the oil industry finds @ @ @ @ @ @ @ just makes it harder for cleaner energy sources to be competitive .
Meanwhile , the financial resources needed to invest in the transition away from hydrocarbons are being rationed .
They ’ re mainly being paid out to BP investors .
The only silver lining will be if those same shareholders reinvest the cash on renewables companies in a better way than BP would spend it .
This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners .
Chris Hughes is a Bloomberg Opinion columnist @ @ @ @ @ @ @ Reuters Breakingviews , as well as the Financial Times and the Independent newspaper .


washingtonpost--2020-05-28--Trump Administration Vows More Relief for Low-Income Communities

There have been complaints from members of Congress and others that the PPP , which allows loans of as much as $ 10 million that can become grants to help small businesses keep workers employed , hasn ’ t been reaching minority-owned firms and businesses that lack an established relationship with a lender .
An SBA inspector general ’ s report on May 8 criticized the agency for failing to take steps to make a priority of borrowers in under-served and rural markets .
The SBA has been seeking out disadvantaged business owners who had trouble getting help from banks @ @ @ @ @ @ @ , an administration official said on condition of anonymity .
Other small businesses have been reluctant to apply because there ’ s too much paperwork , but the application is just two pages , and lenders can help them complete it , the official said .
The SBA also has partnerships with Small Business Development Centers and other organizations and non-profits that can provide technical assistance to help firms access PPP funding , the official said .
The second round of $ 320 billion in PPP financing began on April 27 after an @ @ @ @ @ @ @ exhausted in just 13 days .
The SBA reported on its website that more than 4.4 million loans worth $ 510.5 billion had been approved as of Wednesday , meaning about $ 130 billion remains , according to a second administration official .
Through May 23 , more than 300 CDFIs had handled almost 95,000 loans worth almost $ 7.2 billion , according to an SBA report .
Congress also set aside $ 60 billion for smaller lenders in the second round of PPP funding , including $ 30 billion for CDFIs and @ @ @ @ @ @ @ than $ 10 billion in assets .
For more articles like this , please visit us at bloomberg.com


washingtonpost--2020-05-28--Analysis | An $826 Billion Battle Is Brewing in Europe

Still , unlike the days of Charles de Gaulle and Konrad Adenauer , or Francois Mitterrand and Helmut Kohl , the greater sprawl and complexity of Europe mean such breakthroughs need more than just France and Germany ’ s blessing to secure buy-in across the continent .
A bust-up is looming over what should be spent and how , and it will be a bitter one .
At the center of the battle are the so-called “ frugal four ” — the Netherlands , Sweden , Austria and Denmark — taking up a combative role similar to that of the @ @ @ @ @ @ @ wealthy net contributors to the bloc ’ s budget , they ’ ve already been pushing back against what they see as unfair increases to the share they ’ re expected to chip in after Brexit ; February negotiations on the next seven-year budget went nowhere after 28 hours of talks .
The Covid-19 crisis has redoubled efforts by the frugal four to push back against perceived profligacy , as the EU considers a bigger budget outlay than before , at 1.1 trillion euros ( still only about 1 % of gross national @ @ @ @ @ @ @ tools and proposes aid in the form of grants rather than loans to be paid back — a package worth 2.4 trillion euros .
The budget hard-liners may lack the diplomatic heft of Germany , but they can ’ t be ignored , as the plan needs unanimous support across national parliaments .
Their counter-proposal has yet to be fleshed out , but their public preference for loans over grants is unlikely to be an all-or-nothing fight .
Pushing loans onto highly indebted countries such as Italy would likely make it harder for @ @ @ @ @ @ @ of funds needed to kick-start the recovery .
( The government in Rome is due to receive 82 billion euros in emergency grants . )
It also doesn ’ t make sense to assume that money sent to virus-scarred countries is wasted unless it ’ s directly repaid .
The cash will help to rebuild a single market that was brought to its knees by the pandemic — an obvious boon to trade-focused countries like the Netherlands , ranked as the No .
2 source of exports between EU members .
Few countries @ @ @ @ @ @ @ four ’ s economies are set to shrink between 3 % and 6 % this year .
The EU looked like a sinking ship during the crisis ; this new plan is trying to plug the leak , repair the hull and navigate choppy economic waters over the next decade through investment priorities such as the Green Deal , according to Charles de Marcilly , former adviser to the EPSC think tank .
This will benefit all member states .
Assuming pragmatism wins out here , which is no sure thing , there @ @ @ @ @ @ @ by tweaking the current split of grants versus loans , proposed at 500 billion euros and 250 billion euros respectively .
The Commission also seems to have already backed down from getting rid of prized budget rebates , which give money back to countries footing outsized EU bills .
But the potential depth of voter disgruntlement in a country like the Netherlands — where Prime Minister Mark Rutte ’ s coalition partners appear skeptical of the EU plan — will lead to talk of more conditionality .
The EU budget itself might offer @ @ @ @ @ @ @ and cohesion funds for poorer areas of Europe account for about 71 % of the budget , according to Bruegel , a think tank that has called for a “ structural rethink ” of how they ’ re paid .
There might be ways to improve oversight of this cash while maintaining its intended benefits .
What could make this particular fight so toxic is the internal distrust that has flared up as a result of the virus , from anger in Italy over a lack of support from EU partners to threats @ @ @ @ @ @ @ European member states .
The bloc ’ s members went their own way during the crisis , closing borders and hoarding equipment ; they now have to go back to trusting each other , and also trusting that Brussels will fairly enforce the single market ’ s rules as it crosses the Rubicon of large-scale borrowing .
It ’ s encouraging that Germany , historically a frugal Northern state , realizes geopolitical pressure on the EU from the U.S. and China requires radical steps .
“ ( The plan is ) about making @ @ @ @ @ @ @ of our European Union , ” German Finance Minister Olaf Scholz told Politico .
Talk of grand visions tends to leave the frugal camp cold , though .
“ When you have visions , go see a doctor , ” Rutte once said .
If budget divides can ’ t be bridged , there ’ ll be some dark sights ahead .