U.S. President Donald Trump boasted Monday of his “very strong and personal relationship” with Chinese President Xi Jinping, declaring a new U.S.-China trade deal would immediately allow American farmers to sell more of their products to Beijing.

Stock markets in Asia and Europe jumped sharply after Trump and Xi, as leaders of the world’s two biggest economies, agreed Saturday in Argentina to not impose any new tariffs on each other’s exports for the next 90 days while they negotiate a detailed trade agreement.

U.S. stock indexes also opened sharply higher in New York at the start of a new work week.

“My meeting in Argentina with President Xi of China was an extraordinary one,” Trump said on Twitter. “Relations with China have taken a BIG leap forward! Very good things will happen.”

White House economic adviser Larry Kudlow said the United States won Chinese commitments to buy more than $1 trillion in American products.

The United States had a $335.4 billion trade deficit with China in 2017. Trump said, however, “We are dealing from great strength, but China likewise has much to gain if and when a deal is completed. Level the field!”

The U.S. leader said U.S. farmers “will be a very BIG and FAST beneficiary of our deal with China. They intend to start purchasing agricultural product immediately. We make the finest and cleanest product in the World, and that is what China wants. Farmers, I LOVE YOU!”

Late Sunday, Trump tweeted that “China has agreed to reduce and remove tariffs on cars coming into China from the U.S. Currently the tariff is 40 percent.” On Monday, however, Kudlow said there was an “assumption” that China would eliminate auto tariffs, not a specific agreement.

Also Monday, China’s ministry of foreign affairs said the Chinese and U.S. presidents had agreed to work toward removing all tariffs.

WATCH:  Trump-Xi Dinner in Argentina Leads to Trade War Truce

Trump said he and Xi “are the only two people that can bring about massive and very positive change, on trade and far beyond, between our two great Nations. A solution for North Korea is a great thing for China and ALL!”

Trump, at his political rallies and news conferences, often praises the increase in U.S. military spending during his nearly two years in the White House.

But he tweeted that “at some time in the future,” Xi, Russian President Vladimir Putin of Russia, and he “will start talking about a meaningful halt to what has become a major and uncontrollable Arms Race. The U.S. spent 716 Billion Dollars this year. Crazy!”

The 90-day truce in the escalating trade war between the U.S. and China came during a dinner meeting between the two presidents following the G-20 summit of the world’s biggest economies in Buenos Aires. For months, Trump and Xi have engaged in tit-for-tat increases in tariffs on hundreds of billions of dollars of exports flowing between the two countries.

Trump, speaking to reporters on Air Force One after the plane departed Argentina, said his agreement with Xi will go down “as one of the largest deals ever made. … And it’ll have an incredibly positive impact on farming, meaning agriculture, industrial products, computers — every type of product.”

Trump agreed he will leave the tariffs on $200 billion worth of Chinese products at 10 percent, and not raise it to 25 percent as he has threatened to do January 1, according to a White House statement.

“China will agree to purchase a not yet agreed upon, but very substantial, amount of agricultural, energy, industrial and other product from the United States to reduce the trade imbalance between our two countries,” said White House Press Secretary Sarah Sanders. “China has agreed to start purchasing agricultural product from our farmers immediately.”

Trump and Xi also agreed to immediately begin negotiations on structural changes with respect to forced technology transfer, intellectual property protection, non-tariff barriers, cyber intrusions and cyber theft, services and agriculture, according to the White House statement.

“Both parties agree that they will endeavor to have this transaction completed within the next 90 days. If at the end of this period of time, the parties are unable to reach an agreement, the 10 percent tariffs will be raised to 25 percent,” the statement said.
…

China’s president on Sunday signed new trade deals with Argentina as the Asian giant expands its growing role in Latin American economies.

Presidents Mauricio Macri of Argentina and Xi Jinping of China announced the more than 30 agriculture and investment deals during a state visit following the Group of 20 summit of leaders in Buenos Aires. The deals include an agreement to export Argentine cherries to China and an expansion of a currency swap.

China is among Argentina’s top export markets, especially for agricultural commodities that are the engine of its economy. It is also one of Argentina’s biggest lenders, financing about $18.2 billion in infrastructure and other projects, according to the Inter-American Dialogue, a Washington-based think tank.

“China’s development benefits Argentina, our region and the world,” Macri said during a ceremony at the presidential residence in the outskirts of the Argentine capital.

“We have complementary countries. There are few countries in the world that can buy so many of the high-quality products that we’re capable of making,” Macri said.

The visit comes after U.S. officials said they had reached a 90-day truce in the trade dispute with China that has rattled financial markets and imperiled global economic growth. That announcement followed a Saturday dinner meeting between Xi and President Donald Trump.

Argentina also granted Xi the top honor awarded to foreign politicians, and the Argentine polo association gave the Chinese leader a polo horse. The South American country is home to the world’s top polo players, and Macri said that he wants the sport to make a comeback in China.

Photos released by Argentina’s presidency showed a smiling Xi petting the pony with one hand and holding the reins with the other.

Macri also put a red polo helmet emblazoned with China’s flag on Xi’s head.

Xi congratulated Macri on a successful summit and said that both nations believe that the G-20 spirit of solidarity must prevail in “the firm defense of multilateralism and free trade to build an open global economy and foment the world’s prosperity and stability.”

Xi will go on to visit Panama, which has been negotiating a free-trade deal with China after shifting its diplomatic recognition to Beijing from Taiwan last year, a move that led to complaints from U.S. officials.

 
…

U.S. President Donald Trump has returned home from the Group of 20 meeting of the world’s top economies. After the curtain came down on the summit, the spotlight lingered on the leaders of the two top economies. As VOA’s White House bureau chief Steve Herman reports from Buenos Aires, in the end a truce was achieved in the escalating battle of tariffs between the United States and China.
…

The data stolen from the Marriott hotel empire in a massive breach is so rich and specific it could be used for espionage, identity theft, reputation attacks and even home burglaries, security experts say.

Hackers stole data on as many as 500 million guests of former Starwood chain properties over four years including credit card and passport numbers, birthdates, phone numbers and hotel arrival and departure dates.

It is one of the biggest data breaches on record. By comparison, last year’s Equifax hack affected more than 145 million people. A Target breach in 2013 affected more than 41 million payment card accounts and exposed contact information for more than 60 million customers.

Especially sensitive data

But the target here — hotels where high-stakes business deals, romantic trysts and espionage are daily currency — makes the data gathered especially sensitive.

Jesse Varsalone, a University of Maryland cybersecurity expert, said the affected reservation system could be extremely enticing to nation-state spies interested in the travels of military and senior government officials.

“There are just so many things you can extrapolate from people staying at hotels,” Varsalone said.

And because the data included reservations for future stays, along with home addresses, burglars could learn when someone wouldn’t be home, said Scott Grissom of LegalShield, a provider of legal services.

Starwood brand hotels

The affected hotel brands were operated by Starwood before it was acquired by Marriott in 2016. They include W Hotels, St. Regis, Sheraton, Westin, Element, Aloft, The Luxury Collection, Le Meridien and Four Points. Starwood-branded timeshare properties were also affected. None of the Marriott-branded chains were threatened.

Email notifications for those who may have been affected begin rolling out Friday and the full scope of the breach was not immediately clear.

Marriott was trying to determine if the purloined records included duplicates, such as a single person staying multiple times.

Breach undetected for a while

Security analysts were especially alarmed to learn of the breach’s undetected longevity. Marriott said it first detected it Sept. 8 but was unable to determine until last week what data had possibly been exposed because the thieves used encryption to remove it in order to avoid detection.

Marriott said it did not yet know how many credit card numbers might have been stolen. A spokeswoman said Saturday that it was not yet able to respond to questions such as whether the intrusion and data theft was committed by a single or multiple groups.

Cybersecurity expert Andrei Barysevich of Recorded Future said Saturday he believed the breach was financially motivated.

The cybercrime gang expert in credit card theft such as the eastern European group known as Fin7 could be a suspect, he said, noting that a dark web credit card vendor recently announced that 2.6 million cards stolen from an unnamed hotel chain would soon be available to the online criminal underworld.

“We will have to wait until an official forensic report, although, Marriott may never share their findings openly,” he said.

Marriott said the stolen credit card information was encrypted but the hackers may have obtained the “two components needed to decrypt the payment card numbers.” It said it cannot “rule out the possibility that both were taken.”

Privacy laws

For as many as two-thirds of those affected, the exposed data could include mailing addresses, phone numbers, email addresses and passport numbers. Also dates of birth, gender, reservation dates, arrival and departure times and Starwood Preferred Guest account information.

The breach of personal information could put Marriott in violation of new European privacy laws, as guests included European travelers.

Marriott set up a website and call center for customers who believe they are at risk.

The FBI said anyone contacted by Marriott should “take steps to monitor and safeguard their personally identifiable information and report any suspected instances of identity theft to the FBI’s Internet Crime Complaint Center at www.ic3.gov.”

Passport numbers have previously been part of a hack, though it’s not common. They were among records on 9.4 million passengers of Hong Kong-based airline Cathay Pacific obtained in a breach announced in October.

Combined with names, addresses and other personal information, passport numbers are a greater concern than stolen credit card numbers because thieves could use them to open fraudulent accounts, said analyst Ted Rossman of CreditCards.com.

Hotels long a source of information

The data purloining highlights just how dangerous hotels can be for people worried about their privacy.

“Hotels have long been important government sources of local information for tracking foreigners: reservation systems and loyalty programs took the surveillance global and made it easier for us to give up our privacy,” said Colin Bastable, CEO of Lucy Security.

Intelligence agencies including the U.S. National Security are well plugged into the global travel industry “by fair means or foul,” he said, nongovernment cybercriminals now have the same hacking tools.

“Consumers have become collateral damage,” he said. “And we are all consumers.” He advises providing hotels with as little information as possible when making reservations and checking in.

Last year, the cybersecurity firm FireEye highlighted an effort in which Russian state agents allegedly tried to infiltrate the reservation systems of hotels in Europe and the Middle East.

21 million Starwood program members

When its acquisition by Marriott was first announced in 2015, Starwood had 21 million people in its loyalty program. The company manages more than 6,700 properties across the globe, most in North America.

Marriott, based in Bethesda, Maryland, said in a regulatory filing that it was too early to say what financial impact the breach might have on the company. It said it has cyber insurance and is working with its carriers to assess coverage.

Elected officials were quick to call for action.

The New York attorney general opened an investigation.

Virginia Sen. Mark Warner said the U.S. needs laws that limit the data companies can collect on customers and ensure that companies account for security costs rather than making consumers “shoulder the burden and harms resulting from these lapses.”
…

A U.S. judge in California has granted preliminary approval of a $48 million settlement for investors who said Volkswagen AG made false and misleading statements about its excess diesel emissions. 

Lawyers for the investors, who include police and other municipal pension funds, had estimated that the maximum they could have recovered was $147 million. But Judge Charles Breyer said the settlement agreed to in August appeared “fair, adequate and reasonable.” 

VW, in a statement, said Friday that the “proposed settlement agreement eliminates the uncertainty and considerable costs of protracted litigation in the United States and is in the best interests of the company.” The ruling was issued late Wednesday. 

Buybacks

In total, Volkswagen has agreed to pay more than $25 billion in the United States for claims from owners, environmental regulators, states and dealers, and has offered to buy back about 500,000 polluting U.S. vehicles. The buybacks will continue through 2019. 

The German automaker admitted in September 2015 to secretly installing software in nearly 500,000 U.S. cars to cheat government exhaust emissions tests. The vehicles had emitted up to 40 times the legally allowable pollutants. 

In 2017, VW also pleaded guilty of fraud, obstruction of justice and falsifying statements in a U.S. court. Under the plea deal, the automaker agreed to sweeping reforms, new audits and oversight by an independent monitor for three years. 

Federal prosecutors in Detroit unsealed criminal charges in May against former VW Chief Executive Officer Martin Winterkorn, who remains in Germany. Two other former VW executives have pleaded guilty in the investigation and are in prison. 

In total, nine people have been charged in the United States. 

Breyer set a date for a fairness hearing to allow further comment on the August settlement for May 10, after which a final ruling will be issued. 
…

U.S. President Donald Trump, Canadian Prime Minister Justin Trudeau and Mexican President Enrique Peña Nieto have signed the new U.S. Mexico Canada Agreement, a deal designed to replace the North American Free Trade Agreement. White House Correspondent Patsy Widakuswara reports.
…

During Andres Manuel Lopez Obrador’s successful campaign for the Mexican presidency, his advisers met representatives of dozens of investment funds to allay fears about the leftist’s plans, saying he prized economic stability and wanted to attract foreign capital.

Initially, it worked.

When Lopez Obrador won office by a landslide on July 1, the peso and the stock market rose, buoyed by his conciliatory tone.

The rally continued when Mexico and the United States reached a deal to rework the NAFTA trade pact in late August.

But the mood has since changed.

Lopez Obrador, who takes office Saturday, began saying in September that Mexico was “bankrupt.” When he canceled a new $13 billion Mexico City airport on Oct. 29 on the basis of a widely-derided referendum, investors took flight.

“[Lopez Obrador] behaved quite well from the election in early July until the referendum on the airport. That was really an indication of his true colors,” said Penny Foley, portfolio manager for emerging markets and international equities groups at TCW Group Inc, which manages $198 billion in total.

Foley said the referendum prompted TCW to cut its exposure to bonds issued by state oil firm Pemex, on the grounds that under a Lopez Obrador administration the company would be driven more by politics than by profit.

“We are now slightly underweight Mexico in the dollar fund and neutral in the local currency fund,” she added.

Lopez Obrador wants to attract investment from home and abroad to fuel economic growth and drive an ambitious infrastructure agenda, including a major rail project linking Cancun to Mexico’s southeast, plus a new oil refinery.

Yet decisions such as the airport cancellation have fed investors’ concerns he could push Mexico toward a more authoritarian, arbitrary and partisan form of government.

Mexico’s S&P/BVM IPC stock index has tumbled 17 percent since the market’s post-election peak on Aug. 28, while the peso has fallen around 8 percent against the dollar.

Bond yields on Mexican 10-year sovereign debt have jumped 121 basis points, a sign investors see it as a riskier bet.

By contrast, yields on Brazil’s 10-year debt have fallen over 20 basis points since the Oct. 28 presidential election victory of Jair Bolsonaro, a far-right politician who has appointed a group of pro-market economists to his team. Mexican corporate debt markets have taken note.

Airport operator GAP, which controls terminals in a dozen cities including Tijuana and Guadalajara, canceled a planned 6 billion peso debt issuance this week.

“We decided to wait for better conditions,” GAP chief financial officer Saul Villarreal told Reuters.

Some European businesses are also in wait-and-see mode, said Alberico Peyron, a board member and former head of the Italian chamber of commerce in Mexico.

There was “no panic so far,” but a few executives had put plans on hold until the picture became clearer, he said, adding: “There are more who are worried than are optimistic.”

‘Errors’ made

After 30 years of kicking against the establishment, the veteran Lopez Obrador, a 65-year-old former mayor of Mexico City, claimed the presidency with a promise to clean up government, cut poverty and tame Mexico’s drug cartels.

Aiming to almost double economic growth to around 4 percent, Lopez Obrador wants to revive Pemex, increase pensions and spur development in the poorer south to contain illegal immigration that has strained ties with U.S. President Donald Trump.

Lopez Obrador says rooting out corruption will free up billions of dollars, while he intends to save more with pay cuts for civil servants. However, critics say the cuts could affect the quality of officials in his new administration.

Johannes Hauser, managing director of the German chamber of commerce in Mexico, told Reuters the association’s annual survey of firms, currently underway, was upbeat on Mexico.

Still, initial results suggested companies were not quite as eager to invest or create new jobs as they were a year ago. And the airport cancellation had been a shock, he said.

During their campaign outreach, some of Lopez Obrador’s advisers sought to play down the airport’s importance to markets, while others suggested it was likely to be completed.

Without providing evidence, Lopez Obrador said the project — which has been under construction since 2015 — was tainted by corruption. But more than once, Lopez Obrador had raised the possibility of turning its completion into a private concession.

Incoming Finance Minister Carlos Urzua, whose team sat down with financial heavyweights such as Bank of America, BlackRock, Credit Suisse and Morgan Stanley, told Reuters in April that foreign investors were “not very worried” about the airport.

Now, the scrapping of the hub has raised the prospect of a messy legal dispute with investors that could cost billions of dollars — as well as cloud interest in new projects.

Some members of Lopez Obrador’s incoming government privately express deep misgivings about the decision to cancel the airport, which was based on a referendum organized by his own party in which barely 1 percent of the electorate voted.

They felt the poll, which critics lambasted as opaque and open to abuse, undermined the credibility he had built up over the years he spent campaigning against corruption and vote-rigging.

Lopez Obrador’s taste for rule by referendum, and changes to laws governing everything from banking to mining and pension funds that have been proposed by his National Regeneration Movement and the party’s allies in Congress, have further curdled sentiment.

“I’ve moved from being cautiously optimistic after the election, to being quite pessimistic now,” said Andres Rozental, a former deputy foreign minister of Mexico. “He’s not building on what he got. He’s destroying little by little what he got.”

Facing questions about the airport controversy from a panel of prominent Mexican journalists this month, Lopez Obrador was unrepentant about the referendum, saying that “errors” made were blown out of proportion by adversaries trying to hurt him.

“What I regard as most important in my life is my honesty,” he said. “We are not creating a dictatorship,” he added, repeating what is a frequent aside in his public pronouncements.

Nevertheless, Arturo Herrera, an incoming deputy finance minister, conceded this week that the transition had tested the next government, which must present its first budget by mid-December.

“What we’re all learning is that we need to be extremely careful,” he told Mexican television.
…

It may be the world’s sixth largest, but most other things about India’s economy are up for debate.

The ruling Bharatiya Janata Party (BJP) is under fire for the release of new historical GDP figures that significantly downgraded growth during the years the opposition Congress party was in power, replacing old government estimates and those prepared by an independent committee.

The figures, released by the government’s Central Statistics Office (CSO), showed growth in the 10 years of Congress rule to 2014 averaged 6.7 percent, below an average of 7.4 percent under the current government. A previous government estimate had growth under Congress at 7.8 percent.

P. Chidambaram, a former Congress finance minister, called the release “a joke”. In response India’s current finance minister, the BJP’s Arun Jaitley, said the CSO was a credible organization.

The fallout comes at a critical time for Prime Minister Narendra Modi.

India’s economy grew a weaker-than-expected 7.1 percent in the July-September quarter, from a more than two-year high of 8.2 percent in the previous quarter, government data showed on Friday.

Modi faces a general election next year, when the performance of the economy under his pro-business administration compared with the Congress era is likely to dominate campaigning.

The spat has also alarmed India’s top statisticians, who have long faced the difficult task of estimating growth and unemployment in an economy with hundreds of millions of informal workers, and dominated its financial press and political cartoons in recent days.

“The entire episode threatens to bring disrepute to India’s statistical services,” said an editorial in Mint, one of the country’s leading business newspapers, on Friday.

A joke widely circulated on WhatsApp said the government would soon be reinterpreting the last cricket World Cup, in which India crashed out in the semi-finals, to say the country won based on a new methodology.

COMPETING INTERESTS

Unlike many major economies, India lacks an independent statistical body.

An organization called the National Statistics Commission (NSC) was formed in 2005 with that intention, though it is yet to be recognized as the official body for generating statistics.

Last year the NSC set up a committee, chaired by economist Sudipto Mundle, to come up with a new set of historical GDP figures.

Its report, published in July, showed growth averaged 8.1 percent in the decade before the BJP took power.

After the figures were cheered by the Congress, the government issued a clarification saying the report “had not yet been finalised and various alternative methods are being explored”. Shortly after, the report was pulled from the government’s website.

“The whole thing has unfortunately become very political,” said Mundle, on the battle between the two parties. “It is very troubling.”

Attempts to formalize the NSC’s role have been successively stonewalled by both Congress and the BJP, said N R Bhanumurthy, who sat on the committee chaired by Mundle.

“They have not shown much interest in making it independent from our government,” he said.

The debate over India’s true level of growth is the latest to frustrate economists looking to measure the performance of the country of 1.3 billion people.

India has not published its official employment survey since 2015, while a smaller quarterly survey on companies employing more than 10 workers has not been released since March while the government comes up with new methodology.

India’s large informal sector made calculating employment “almost impossible”, Bhanumurthy said, leading to a vacuum that was filled with competing political interests.
…

Police raided six Deutsche Bank offices in and around Frankfurt on Thursday over money laundering allegations linked to the “Panama Papers”, the public prosecutor’s office in Germany’s financial capital said.

Investigators are looking into the activities of two unnamed Deutsche Bank employees alleged to have helped clients set up offshore firms to launder money, the prosecutor’s office said.

Around 170 police officers, prosecutors and tax inspectors searched the offices where written and electronic business documents were seized.

“Of course, we will cooperate closely with the public prosecutor’s office in Frankfurt, as it is in our interest as well to clarify the facts,” Deutsche Bank said, adding it believed it had already provided all the relevant information related to the “Panama Papers”.

The news comes as Deutsche Bank tries to repair its tattered reputation after three years of losses and a drumbeat of financial and regulatory scandals.

Christian Sewing was appointed as chief executive in April to help the bank to rebuild. He trimmed U.S. operations and reshuffled the management board but revenue has continued to slip.

Deutsche Bank shares were down more than 3 percent by 1220 GMT and have lost almost half their value this year.

Offshore links

The investigation was triggered after investigators reviewed so-called “Offshore-Leaks” and “Panama Papers”, the prosecutor said.

The “Panama Papers”, which consist of millions of documents from Panamanian law firm Mossack Fonseca, were leaked to the media in April 2016.

Several banks, including Scandinavian lenders Nordea and Handelsbanken have already been fined by regulators for violating money laundering rules as a result of the papers.

The prosecutors said they are looking at whether Deutsche Bank may have assisted clients to set up offshore companies in tax havens so that funds transferred to accounts at Deutsche Bank could skirt anti-money laundering safeguards.

In 2016 alone, over 900 customers were served by a Deutsche Bank subsidiary registered on the British Virgin Islands, generating a volume of 311 million euros, the prosecutors said.

They also said Deutsche Bank employees are alleged to have breached their duties by neglecting to report money laundering suspicions about clients and offshore companies involved in tax evasion schemes.

The investigation is separate from another money laundering scandal surrounding Danish lender Danske Bank, where Deutsche Bank is involved.

Danske is under investigation for suspicious payments totaling 200 billion euros from 2007 onwards and a source with direct knowledge of the case has told Reuters Deutsche Bank helped to process the bulk of the payments.

A Deutsche Bank executive director has said the lender played only a secondary role as a so-called correspondent bank to Danske Bank, limiting what it needed to know about the people behind the transactions.

Under scrutiny

Weaknesses in Deutsche Bank’s controls that aim to prevent money laundering have caught the attention of regulators on both sides of the Atlantic. The bank has publicly said that it agreed it needed to improve its processes to properly identify clients.

In September, Germany’s financial watchdog – BaFin – ordered Deutsche Bank to do more to prevent money laundering and “terrorist financing,” and appointed KPMG as third party to assess progress.

In August, Reuters reported that Deutsche Bank had uncovered further shortcomings in its ability to fully identify clients and the source of their wealth.

Last year, Deutsche Bank was fined nearly $700 million for allowing money laundering through artificial trades between Moscow, London and New York. An investigation by the U.S.

Department of Justice is still ongoing.

Deutsche Bank has been under pressure after annual losses, and it agreed to pay a $7.2 billion settlement with U.S. authorities last year over its sale of toxic mortgage securities in the run-up to the 2008 financial crisis.

 
…

U.S. President Donald Trump said Wednesday that new auto tariffs were “being studied now,” asserting they could prevent job cuts such as the U.S. layoffs and plant closures that General Motors Co. announced this week. 

 

Trump said on Twitter that the 25 percent tariff placed on imported pickup trucks and commercial vans from markets outside North America in the 1960s had long boosted U.S. vehicle production. 

 

“If we did that with cars coming in, many more cars would be built here,” Trump said, “and G.M. would not be closing their plants in Ohio, Michigan & Maryland.” 

 

The United States has a 2.5 percent tariff on imported cars and sport utility vehicles from markets outside North America and South Korea. The new North American trade deal exempts the first 2.6 million SUVs and passenger cars built in Mexico and Canada from new tariffs. 

 

Several automakers said privately on Wednesday that they feared GM’s action could prompt Trump to act faster than expected on new tariffs. 

 

GM did not directly comment on Trump’s tweets but reiterated that it was committed to investing in the United States. On Monday, the company said it would shutter five North American plants, stop building six low-selling passenger cars in North America and cut up to 15,000 jobs. The company has no plans to shift production of those vehicles to other markets. 

 

The administration has for months been considering imposing dramatic new tariffs on imported vehicles. 

 

The U.S. Commerce Department has circulated draft recommendations to the White House on its investigation into whether to impose tariffs of up to 25 percent on imported cars and parts on national security grounds, Reuters reported earlier this month. 

 

“The President has great power on this issue – Because of the G.M. event, it is being studied now!” Trump said. 

 

Shock to industry

The prospect of tariffs of 25 percent on imported autos and parts has sent shock waves through the auto industry, with both U.S. and foreign-brand producers lobbying against it and warning that national security tariffs on EU and Japanese vehicles could dramatically raise the price of many vehicles. 

 

Trump has also harshly criticized GM for building cars in China. The United States slapped an additional 25 percent tariff on Chinese-made vehicles earlier this year, prompting China to retaliate. 

 

China currently imposes a 40 percent tariff on U.S. automobiles, while the United States has a 27.5 percent tariff on Chinese vehicles. 

 

U.S. Trade Representative Robert Lighthizer said in a statement on Wednesday that he “will examine all available tools to equalize the tariffs applied to automobiles.” 

 

Additional tariffs on Chinese-made vehicles and parts would have a limited impact, said Kristin Dziczek, an economist at the Center for Automotive Research. She noted only a small number of vehicles were exported from China to the United States annually. 

 

The White House previously pledged not to move forward with imposing national security tariffs on the European Union or Japan while it was making constructive progress in trade talks. 

 

Trump wants the EU and Japan to buy more American-made vehicles. He wants the EU and Japan to make trade concessions, including lowering the EU’s 10 percent tariff on imported vehicles and cutting nontariff barriers. 

 

The White House in recent weeks has reached out to the chief executives of German automakers, including Daimler AG, MW AG and Volkswagen AG about meeting to discuss the status of auto trade.  
…

Federal Reserve Chair Jerome Powell boosted U.S. stock markets on Wednesday when he said interest rates were “just below” estimates of a level that neither brakes nor boosts a healthy economy. Many took his comments as a signal that the Fed’s three-year tightening cycle is ending. 

The S&P 500 and Dow posted their biggest percentage gains in eight months, while the Nasdaq saw its largest advance in just over a month following Powell’s speech to the Economic Club of New York. 

Powell said that while “there was a great deal to like” about U.S. prospects, “our gradual pace of raising interest rates has been an exercise in balancing risks.” 

Earlier in the day, in its first-ever financial stability report, the Fed cautioned that trade tensions, Brexit and troubled emerging markets could rock a U.S. financial system where asset prices are “elevated.” 

‘Close to neutral’

“[Powell is] now acknowledging he’s close to neutral, which suggests maybe not quite as many rate hikes in the future as investors believed,” said Jack Ablin, chief investment officer at Cresset Wealth Advisors in Chicago. “It’s certainly a change of language and welcome news to investors.” 

The U.S. Commerce Department affirmed that U.S. GDP grew in the third quarter at a 3.5 percent annual rate, but the goods trade deficit widened, consumer spending was revised lower and sales of new homes tumbled, suggesting clouds are gathering over what is now the second-longest economic expansion on record. 

The Dow Jones industrial average rose 617.7 points, or 2.5 percent, to 25,366.43, the S&P 500 gained 61.61 points, or 2.30 percent, to 2,743.78 and the Nasdaq Composite added 208.89 points, or 2.95 percent, to 7,291.59. 

Of the 11 major sectors in the S&P 500, all but utilities were positive. Technology and consumer discretionary were the biggest percentage gainers, each up more than 3 percent. 

The S&P 500 Automobile & Components index was up 1.4 percent after President Donald Trump said he was studying new auto tariffs in the wake of General Motors Co.’s announcement that it would close plants and cut its workforce. 

Humana cuts forecast

Health insurer Humana Inc. cut its 2019 forecast for Medicare drug plan enrollment but upped its estimated enrollment in the company’s Medicare Advantage plan. Its stock ended the session up 6.2 percent. 

Salesforce.com Inc. beat analysts’ earnings estimates and forecast better-than-expected 2020 revenue, sending its shares up 10.3 percent. Other cloud software makers rose on the news, with the ISE Cloud Index gaining 3.5 percent. 

Microsoft Corp briefly surpassed Apple Inc. in market cap but Apple took back its lead by closing. Nevertheless, Microsoft closed 4.0 percent higher as it benefited from optimism regarding demand for cloud computing services. 

Among losers, Tiffany & Co. shares dropped 11.8 percent after the luxury retailer missed quarterly sales estimates on slowing Chinese demand. 

Advancing issues outnumbered declining ones on the NYSE by a 3.95-to-1 ratio; on Nasdaq, a 3.58-to-1 ratio favored advancers. 

The S&P 500 posted 17 new 52-week highs and six new lows; the Nasdaq Composite recorded 37 new highs and 129 new lows. 

Volume on U.S. exchanges was 8.04 billion shares, compared with the 7.82 billion-share average over the last 20 trading days. 
…

U.S. President Donald Trump touted the use of U.S. tariffs on foreign small trucks Wednesday, saying their placement on other foreign vehicles would have prevented the closure of several General Motors plants and the loss of thousands of coveted manufacturing jobs.

Trump noted on Twitter that brisk U.S. small truck sales in the country are due to a 25-percent tariff on small truck imports.

The president reiterated on Twitter that “countries that send us cars have taken advantage of the U.S. for decades.” Trump added he has “great power on this issue,” which he said “is being studied now.”

Trump has threatened to eliminate all federal subsidies to GM in response to the company’s planned closure of five plants and the elimination of 14,000 jobs in North America. Questions remain, though, about whether Trump has the authority to act against the automaker without congressional approval.

Federal tax credits of up to $7,500 are available to those who buy GM electric vehicles. Killing the subsidies may have little financial impact on GM because it is on the cusp of reaching its subsidy limit.

Many of the jobs would be eliminated in Midwestern U.S. states, a region where Trump has long promised a manufacturing rebirth.

GM, which said it has invested more than $22 billion in U.S. operations since it came out of bankruptcy in 2009, has tried to appease the Trump administration while justifying its decisions.

“We appreciate the actions this administration has taken on behalf of industry to improve the overall competitiveness of U.S. manufacturing,” GM said in a statement Tuesday.

Before GM can shutter factories next year in Michigan, Ohio and Ontario, Canada, it must reach agreement with the United Auto Workers union. The union has vowed to fight the closures legally and in collective bargaining.

GM’s restructuring reflects changes in buying trends in North America, prompting vehicle manufacturers to shift away from cars and toward SUVs and trucks.

 

 

 

 

 
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U.S. Federal Reserve Chair Jerome Powell said on Wednesday that while there was “a great deal to like” about U.S. prospects, the Fed’s gradual interest rate hikes are meant to balance risks as it tries to keep the economy on track.

“We know that things often turn out to be quite different from even the most careful forecasts,” Powell said in a speech that comes in the wake of last week’s volatile market selloff. “Our gradual pace of raising interest rates has been an exercise in balancing risks.”

Powell offered few clues on how much longer the U.S. central bank would raise interest rates in the face of a slowdown overseas and market volatility at home. Instead he highlighted a new financial stability report the Fed published earlier on Wednesday.

“My own assessment is that, while risks are above normal in some areas and below normal in others, overall financial stability vulnerabilities are at a moderate level,” he said at an Economic Club of New York luncheon.
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An airport worker drops by Warsaw’s newest Ikea store during her lunch break to finish up plans for a home refurbishment. Around her, people drift in and out of the shop, placing small houseware items in big yellow bags as cafe tables fill up with people just stopping in for lunch.

The store is not one of Ikea’s out-of-the-way, maze-like warehouses that require a car to visit, but a shop like any other in a city center shopping mall. The Swedish retailing giant plans to open 30 such smaller stores in major cities around the world as part of a broader transformation to adapt to changing consumer habits.

Compared with just a decade ago, shoppers are more likely to be living in urban areas and not have a car, and often want a nearby location to look at goods like furniture in person before ordering things online.

“I like the idea because you can come any time,” said 29-year-old Angelika Singh, the airport worker, as she finalized an order for a new kitchen. “Mostly when you go to Ikea you need to have a whole day free, or at least half a day free, because it’s far.”

Warsaw’s store is located on two floors covering nearly 5,000 square meters (54,000 square feet), about one-fourth of a traditional big-box store. Similar stores have also opened in major cities like London and Madrid and more are expected, with one due next year in Paris, among other locations.

Shoppers can buy cushions, curtains and other home items. They can design the layout of bedrooms and kitchens at computer stations. But those hoping to buy a bookcase or bed will not find them stocked in a large warehouse, though they can order them at kiosks and have them delivered to their homes.

As such, it offers a very different shopping experience from the usual visit to one of the large warehouse stores.

“Ikea’s been doing pretty much the same for 70 years. It’s been a cash-and-carry company, and it still is for the majority of its sales,” said Andreas Flygare, the project manager for the Warsaw store. Now, he explained, the company must adapt to a consumer environment that has changed dramatically in the last 10 years.

“You have companies like Amazon and Uber that are raising the bar for what is expected. Because if you can have same-day delivery, or an Uber is two minutes away, it influences other companies, like Ikea,” he said in a recent interview in the store’s cafe. “It can be a quite tough environment. Everything is changing so fast.”

While Ikea is still profitable, its earnings have recently been growing more slowly than expected.

Thomas Slide, senior retail analyst at the market research firm Mintel, described it as a rational response to a “global trend towards urban living and a rebirth of the cities.”

“While Ikea used to be able to build its big blue warehouses on the edge of towns and cities and expect shoppers to come to them, now it has recognized it needs to be more flexible in its approach and take the Ikea experience to them, through digital channels and smaller stores closer to where people live and work,” Slide said.

Ikea isn’t the first to embrace such an approach. In the U.S., retailer Target has rolled out smaller stores to broaden its reach. French hardware store Leroy Merlin has done the same, as have Kingfisher-owned DIY store B&Q and sofa retailer DFS in Britain.

“While Ikea may not be on the cutting edge of this trend, it’s an important strategy to prepare the business for the future,” Slide said. “The challenge will be adding extra services through additional channels while also maintaining profitability.”

Chen Yu Ting, a 25-year-old from Taiwan who studies medicine in Warsaw, said it used to take him 40 minutes by bus to visit one of the large Ikea stores outside the city. But he is a short walk to the new store, and after an initial trip to buy pillows and bed sheets he now returns often for lunch, which is priced right for his budget.

“It’s more convenient, and now I just come here to eat,” he said.

His only complaint? The store doesn’t stock frozen meatballs.
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U.S. President Donald Trump threatened on Tuesday to cut subsidies for General Motors after the largest U.S. automaker said it would halt production at five plants in North America and cut nearly 15,000 jobs.

“The U.S. saved General Motors, and this is the THANKS we get! We are now looking at cutting all @GM subsidies, including … for electric cars,” Trump said on Twitter.

Trump has made boosting auto jobs a key priority during his almost two years in office and has often attacked automakers on Twitter for not doing enough to boost U.S. employment.

GM electric vehicles are eligible for a $7,500 tax credit under federal law, but it is not clear how the administration could restrict those credits or if Trump had other subsidies in mind. GM shares extended earlier declines and were down 3.6 percent after Trump’s tweets.

GM declined to immediately comment.

GM Chief Executive Mary Barra spoke to Trump over the weekend to discuss the cuts and was at the White House on Monday to meet with economic adviser Larry Kudlow.

Trump also criticized GM for not closing facilities in Mexico or China.

“General Motors made a big China bet years ago when they built plants there (and in Mexico) – don’t think that bet is going to pay off. I am here to protect America’s Workers!” Trump wrote on Twitter.

GM currently builds just one vehicle in China that it exports to the United States — the Buick Envision — and has sold about 22,000 through September. GM sold nearly 2.7 million vehicles in China through September, nearly all of them built in China for the market.

White House spokesman Sarah Sanders told reporters Tuesday that the president is looking at options.

“The president wants to see American companies build cars here in America, not build them overseas and he is hopeful that GM will continue to do that here,” she said.

GM has been lobbying Congress, along with Tesla, to lift the current cap on electric vehicles eligible for tax credits, but any action by Congress before 2019 is a long-shot, congressional aides said.

Under current law, once a manufacturer sells 200,000 electric vehicles, the tax credit phases out over time starting in the following quarter. GM has said it expects to hit the 200,000-vehicle threshold by the end of the year.

GM announced Monday it will halt production at one Canadian plant and four U.S. factories, including the Detroit-Hamtramck Assembly plant that builds the plug-in hybrid electric Chevrolet Volt. GM is ending production of six vehicles, including the Volt, as it cuts more than 6,500 factory jobs.

GM will continue to build the electric Chevrolet Bolt in Michigan.

Trump told GM on Monday it “better” find a new product for Lordstown Assembly plant in Ohio that will halt production in March. GM has said sagging demand for small cars largely prompted the cuts, but also cited factors including higher costs from U.S. tariffs on steel and aluminum.

GM said it also plans to close two unnamed plants outside North America by the end of 2019.
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U.S. President Donald Trump and Chinese President Xi Jinping could reach a new trade deal between the world’s two largest economies when they meet in Argentina this weekend, White House economic adviser Larry Kudlow said Tuesday.

“The president said there is a good possibility that we can make a deal and he is open to it,” he said of Trump. But he cautioned that obstacles remain.

Kudlow said the two leaders must resolve the issues of “fairness and reciprocity” at the center of the dispute.

“China should change its practices and come into the community of responsible trading nations,” he said. “Their responses have disappointed because … we can’t find much change in their approach.”

The U.S. and China over several months have imposed tit-for-tat tariffs on hundreds of billions of dollars of imports arriving from each other’s shores.

On Monday, Trump voiced doubts that a deal would be reached when he meets with Xi Saturday night in Buenos Aires on the sidelines of the G-20 summit of the world’s largest economies.

Trump has threatened to impose more tariffs on Chinese exports if the two sides cannot reach what he considers fairer trading between the two countries.

Kudlow said “certain conditions have to be met. … Intellectual property theft must be solved. Forced technology transfers must be solved.”

He said Trump is “not going away” if no deal is reached.

“I hope they understand that,” he added.
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British and Dutch regulators have fined ride-hailing company Uber $1.2 million for what it said were inadequate security measures that left personal data at risk for a cyber attack.

The fines are linked to a 2016 hack of Uber data that allowed attackers to download information about 32 million users, including 2.7 million accounts in Britain.

The files included full names, mobile phone numbers, email addresses and some user passwords. Information about 3.7 million drivers, 82,000 of them in Britain, was also downloaded.

Britain’s Information Commissioner’s Office said the hack was the result of “a series of avoidable data security flaws.”

“This was not only a serious failure of data security on Uber’s part, but a complete disregard for the customers and drivers whose personal information was stolen,” ICO Director of Investigations Steve Eckersley said. “At the time, no steps were taken to inform anyone affected by the breach, or to offer help and support. That left them vulnerable.”

Uber said in a statement it is “pleased to close this chapter on the data incident from 2016.”

“As we shared with European authorities during their investigations, we’ve made a number of technical improvements to the security of our systems both in the immediate wake of the incident as well as in the years since,” the company said.
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Fishing communities along Africa’s coastline are at a greater risk of extinction as countries eye oceans for tourism, industrial fishing and exploration revenue to jumpstart their “blue economies,” U.N. experts and activists said on Monday.

The continent’s 38 coastal and island states have in recent years moved to tap ocean resources through commercial fishing, marine tourism and sea-bed mining, according to the United Nations Economic Commission for Africa (UNECA).

“There is a great risk and a great danger that those communities will be marginalized,” said Joseph Zelasney, a fishery officer at U.N.’s Food and Agriculture Organization (FAO).

“The resources that they depend on will be decimated,” he added at a side event at the Blue Economy Conference organized by Kenya, Canada and Japan in Nairobi.

The world’s poorest continent hosts a blue economy estimated at $1 trillion but loses $42 billion a year to illegal fishing and logging of mangroves along the coast, according to UNECA estimates.

Seismic waves generated by prospectors to search for minerals, oil and gases along the ocean floor have scared away fish stocks, said Dawda Saine of the Confederation of African Artisanal Fishing in Gambia.

“Noise and vibration drives fishes away, which means they (fishermen) have to go further to fish,” Saine said.

Pollution from a vibrant tourism sector and foreign trawlers have reduced stocks along the Indian Ocean, Salim Mohamed, a fisherman from Malindi in Kenya, said.

“We suffer as artisanal fishers but all local regulation just look at us as the polluter and doesn’t go beyond that,” he said.

The continent’s fish stocks are also being depleted by industrial trawlers which comb the oceans to feed European and Asian markets, experts say, posing a threat to livelihoods and food security for communities living along the coast.

Growth of blue economies in Africa could also take away common rights to land and water along the coastline and transfer them to corporations and a few individuals, said Andre Standing, advisor with the Coalition for Fair Fisheries Arrangements.

Most of the land and beaches along Africa’s thousands of miles of coastline is untitled, making it a good target for illegal acquisition, activists said.

“There is a great worry that we could see privatization of areas that were previously open to these communities,” Standing told the Thomson Reuters Foundation. “We need to have a radical vision that values communities and livelihoods or they will become extinct.”
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Apple is launching a new program designed to address the technology industry’s scarcity of women in executive and computer programming jobs.

 

Under the initiative announced Monday, female entrepreneurs and programmers will attend two-week tutorial sessions at the company’s Cupertino, California, headquarters.

 

The camps will be held every three months beginning in January. For each round, Apple will accept up to 20 app makers founded or led by a woman. The app maker must have at least one female programmer in its ranks to qualify. Apple will cover travel expenses for up to three workers from each accepted company.

Like other major tech companies, Apple has been trying to lessen its dependence on men in high-paying programming jobs. Women filled just 23 percent of Apple’s technology jobs in 2017, according to the company’s latest breakdown. That’s only a slight improvement from 20 percent in 2014, despite the company’s pledge to diversify its workforce.

 

The idea behind the new camp is to keep women interested and immersed in the field, said Esther Hare, Apple’s senior director of world developer marketing.

 

It’s not clear how much of a dent Apple’s new program will have. Google also offers training for girls and women pursuing careers in technology, but its program hasn’t done much to diversify the workforce so far. Women were hired for nearly 25 percent of Google’s technology jobs in 2017, up from nearly 21 percent in 2014, according to the company.

Apple and other technology companies maintain that one of the main reasons so many men are on their payrolls is because women traditionally haven’t specialized in the mathematical and science curriculum needed to program.

 

But industry critics have accused the technology companies of discriminating again women through a male-dominated hierarchy that has ruled the industry for decades.

 

Apple isn’t saying how much it is spending on the initiative, though beyond travel expenses, the company will be relying on its current employees to lead the sessions.
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United Technologies is breaking itself into three independent companies now that it has sealed its $23 billion acquisition of aviation electronics maker Rockwell Collins.

The company’s announcement Monday was the latest by a sprawling industrial conglomerate deciding it will be more efficient and focused as smaller, separate entities.

“Our decision to separate United Technologies is a pivotal moment in our history and will best position each independent company to drive sustained growth, lead its industry in innovation and customer focus, and maximize value creation,” said United Technologies CEO Gregory Hayes.

The three companies will be United Technologies, which will house its aerospace and defense industry supplier businesses; Otis, the maker of elevators, escalators and moving walkways; and the Carrier air conditioning and building systems business.

The separation is expected to be completed in 2020, United Technologies said.

On Friday, United Technologies said it received final regulatory approval for its deal for Rockwell Collins, a Cedar Rapids, Iowa-based maker of flight deck avionics, cabin electronics and cabin interiors. The newly minted combined aerospace business would have had sales of about $39 billion last year, United Technologies said.

Hayes will stay on as CEO of the aerospace business. The company did not name leaders for the separated Otis and Carrier businesses.

Founded in 1934, United Technologies is based in Farmington, Connecticut, and currently employs about 205,000 people. It did not say if any jobs would be lost in the breakup.

The company got embroiled in politics in 2016 when then-presidential candidate Donald Trump criticized plans to close a Carrier plant in Indianapolis and shift production to Mexico. Weeks after Trump won the election, Carrier announced an agreement brokered by the president-elect to spare about 800 jobs in Indianapolis, where the company has pledged to keep nearly 1,100 jobs. That’s down from the approximately 1,600 factory, office and engineering jobs at the facility.
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