Billions
Page: 13
President Donald Trump took a step back on Tuesday from his threat to close the U.S. southern border to fight illegal immigration, as pressure mounted from companies worried that a shutdown would cause chaos to supply chains.
Trump threatened on Friday to close the border this week unless Mexico acted. He repeated that threat on Tuesday but said he had not made a decision yet: “We’re going to see what happens over the next few days.”
Closing the border could disrupt millions of legal crossings and billions of dollars in trade. Auto companies have been warning the White House privately that it would lead to the idling of U.S. plants within days because they rely on prompt deliveries of components made in Mexico.
The U.S. Chamber of Commerce, the largest U.S. business lobbying group, has been in contact with the White House to discuss the “very negative economic consequences that would occur across the country,” said Neil Bradley, the group’s top lobbyist, on a call with reporters.
Trump praised efforts by Mexico to hinder illegal immigration from Central America at its own southern border. On Monday, the Mexican government said it would help regulate the flow of migrants.
“I really wanted to close it,” Trump said on Tuesday night at a fundraiser for congressional Republicans.
The Mexican government has not published apprehension statistics, but a senior White House official said it had provided daily updates to the Trump administration, including specific apprehension numbers.
“They say they’re going to stop them. Let’s see. They have the power to stop them, they have the laws to stop them,” Trump said earlier on Tuesday.
PUSH BACK
Trump has made fighting illegal immigration from Mexico and Central America a key part of his agenda, but shutting down one of the world’s most used borders might be a step too far, even for many of his fellow Republicans.
Republican Senate Majority Leader Mitch McConnell joined Democrats in warning Trump against such a move.
“Closing down the border would have potentially catastrophic economic impact on our country and I would hope we would not be doing that sort of thing,” McConnell told reporters on Tuesday.
A group representing General Motors Co, Ford Motor Co and Fiat Chrysler Automobiles NV said in a statement that “any action that stops commerce at the border would be harmful to the U.S. economy, and in particular, the auto industry.”
Dozens of U.S. vehicle, engine, transmission and other auto parts plants could close because of a lack of components in the days after a border shutdown. It would also prevent thousands of vehicles built in Mexico from landing in U.S. dealer showrooms.
Automakers exported nearly 2.6 million Mexican-made vehicles to the United States in 2018, accounting for 15 percent of all vehicles sold in the country. Some, like the Chevrolet Blazer SUV, are only made in Mexico.
Retailers are also raising alarm bells, according to officials with two groups that represent hundreds of U.S. retail firms.
“It will be unprecedented self-inflicted pain,” said David French, senior vice president of government relations at the National Retail Federation. “We are still nervous about this and we have been talking to some of our companies about maybe ramping up direct pressure on the White House by getting CEOs to call.”
SLOWER BORDER
Senior U.S. Department of Homeland Security officials said on Tuesday a recent redeployment of some 750 officers on the border to deal with a surge in migrants – mostly Central American families turning themselves in to border agents – had already led to a slowing of legal crossings and commerce at ports of entry.
“Wait times in Brownsville (Texas) were around 180 minutes, which were two times the peaks of last year,” said a senior DHS official on a call with reporters. “We ended the day yesterday at Otay Mesa (California) with a backup of 150 trucks that hadn’t been processed,” the official said.
Mexican Foreign Minister Marcelo Ebrard said on Tuesday that backups were delaying commercial traffic at the U.S.-Mexico border at several crossings. He said the government had not drastically changed its migration strategy following the shutdown threats.
DHS officials said border facilities had been overwhelmed by families seeking asylum, fleeing poverty and violence in Central America.
DHS Secretary Kirstjen Nielsen said Manuel Padilla, a 30-year veteran of the U.S. Border Patrol, would now serve as the agency’s coordinator on the border response.
U.S. Customs and Border Protection estimated that some 100,000 migrants were apprehended or encountered at the border in March, the highest level in a decade. “The system is on fire,” a DHS official said.
Because of limits on how long children are legally allowed to be held in detention, many of the families are released to await U.S. immigration court hearings, a process that can take years because of ballooning backlogs.
To try to address the problem, the Trump administration in January started sending some migrants to wait out their U.S. court dates in Mexican border cities. On Monday, DHS said it would dramatically ramp up that program, despite court challenges.
The biggest priority for Nielsen is to seek action from Congress to change the immigration laws, said a DHS official. She sent a letter to Congress last week repeating many of the Trump administration’s demands, including a request to quickly deport Central American minors that cross the border alone.
Under current law, minors who are not from the contiguous countries of Canada and Mexico are placed in the care of sponsors in the United States, which Nielsen called a “dangerous ‘pull’ factor” for migrants. Migrant advocates and some Democrats in Congress oppose the proposed legislative changes, saying they would send vulnerable children back to dangerous situations in their home countries.
Trump said he had spoken with “a few” Democrats on Tuesday about the administration’s proposals and added: “They’re changing their minds.”
Source: NewsMax Politics
Former federal prosecutor Lori Lightfoot was elected Chicago mayor on Tuesday, becoming the first black woman and first openly gay person to lead the nation’s third-largest city.
Lightfoot defeated Toni Preckwinkle, who served in the City Council for 19 years before becoming Cook County Board president.
Lightfoot promised to rid City Hall of corruption and help low-income and working-class people she said had been “left behind and ignored” by Chicago’s political ruling class. It was a message that resonated with voters weary of political scandal and insider deals, and who said the city’s leaders for too long have invested in downtown at the expense of neighborhoods.
Chicago will become the largest U.S. city to elect a black woman as mayor when Lightfoot is sworn in May 20. She will join seven other black women currently serving as mayors in major U.S. cities, including Atlanta and New Orleans.
Lightfoot, 56, has never been elected to public office. She and her wife have one daughter.
She emerged as the surprising leader in the first round of voting in February when 14 candidates were on the ballot to succeed Mayor Rahm Emanuel, who decided against running for a third term.
Lightfoot seized on outrage over a white police officer’s fatal shooting of black teenager Laquan McDonald to launch her reformer campaign. That was even before Emanuel announced he wouldn’t seek re-election amid criticism for initially resisting calls to release video of the shooting.
“I’m not a person who decided I would climb the ladder of a corrupt political party,” Lightfoot said during a debate last month. “I don’t hold the title of committeeman, central committeeman, boss of the party.”
Preckwinkle countered that her opponent lacks the necessary experience for the job.
“This is not an entry-level job,” Preckwinkle has said repeatedly during the campaign. “It’s easy to talk about change. It’s hard to actually do it. And that’s been my experience — being a change maker, a change agent, transforming institutions and communities.”
Joyce Ross, 64, a resident of the city’s predominantly black West Side who is a certified nursing assistant, cast her ballot Tuesday for Lightfoot. Ross said she believes Lightfoot will be better able to clean up the police department and curb city’s violence.
She was also bothered by Preckwinkle’s association with longtime Alderman Ed Burke, who was indicted earlier this year on charges he tried to shake down a restaurant owner who wanted to build in his ward.
“My momma always said birds of a feather flock together,” Ross said.
Truly Gannon, a 39-year old mother of four who works as a dietitian, said she wasn’t bothered by stories that portrayed Preckwinkle as an insider aligned with questionable politicians like Burke. She supported Preckwinkle, based on her experience.
“I’m not sure Lightfoot would be able to handle the job like Preckwinkle,” she said.
The campaign between the two women got off to a contentious start, with Preckwinkle’s advertising focusing on Lightfoot’s work as a partner at Mayer Brown, one of the nation’s largest law firms, and tagging her as a “wealthy corporate lawyer.”
Preckwinkle also tried to cast Lightfoot as an insider for working in police oversight posts under Emanuel and police oversight, procurement and emergency communications posts under Mayor Richard M. Daley.
In one ad, Preckwinkle criticizes Lightfoot’s oversight of the emergency communications in 2004 when a fire killed four children. A judge ordered Lightfoot to preserve 911 tapes after questions were raised about how the emergency call was handled. The ad notes some of the tapes were destroyed, prompting the judge to rebuke Lightfoot. The ad sparked a backlash from the family of three of the children killed, with their sister accusing Preckwinkle of trying to take advantage of her family’s tragedy.
Lightfoot also responded by scolding her opponent for being negative while also airing ads pointing out Preckwinkle’s connection to powerful local Democrats, including one under federal indictment.
Preckwinkle spent much of her time during the campaign answering for her ties to Chicago’s political establishment. She and her supporters asserted her rise to Democratic Party leadership did not hinder her ability to oppose policies promoted by the city’s ever-powerful mayors.
“My whole career has been about change, and change is action and results, not simply words,” said Preckwinkle, who asserts her experience makes her better positioned to lead a city with financial problems and poorer neighborhoods that are racked by gun violence.
Despite the barbs on the campaign trail, the two advanced similar ideas to boost the city’s deeply troubled finances, which include an estimated $250 million budget deficit next year and billions in unfunded pension liabilities.
Both candidates expressed support for a casino in Chicago and changing the state’s income tax system to a graduated tax, in which higher earners are taxed at a higher rate — two measures lawmakers have tried for unsuccessfully for years to pass.
Lightfoot said that as mayor, she would focus on investing in neighborhoods on the West and South Sides and bring transparency and accountability to City Hall. She added she also wants to restore people’s faith in government.
Election officials said turnout was approaching 30 percent just before polls were scheduled to close.
Source: NewsMax America
A growing number of economists are predicting the current economic boom will turn to bust in 2019.
When recession does come, will economists simply call for more of the same — namely endless government spending?
After all, in the wake of the 2008 financial crisis, most economists told us the problem was the private sector was not spending and investing enough. So, we were told, government must step in and make up the difference with deficit spending to get “idle resources” — like capital goods and labor — back to work.
But what should the government be spending on? Apparently, anything.
This is not an exaggeration. For example, noted Cal-Berkeley economist Brad DeLong insisted in 2009 “At this point, anything that boosts the government’s deficit over the next two years passes the benefit-cost test — anything at all.”
Such thinking reveals one of fatal flaws of mainstream economics: the idea that all the economy is one big homogeneous blob. As Friedrich Hayek put it, “Mr. Keynes’ aggregates conceal the most fundamental mechanisms of change.”
The Problem of Malinvestment
During the 2002-2007 housing boom, significant amounts of capital and labor were organized in very specific locations, combinations and uses at multiple stages of production to produce more houses to satisfy consumer demands. This meant more construction workers employed building homes in growing communities, and more mortgage brokers and investment bankers to finance the boom. It also meant more inputs such as wood, nails, concrete and glass directed toward homebuilding; which in turn required more lumber processing, steel production, and so on.
When the housing bubble burst, millions of these workers became unemployed, and significant portions of the structures of production that were expanded to support the bubble became idle as well. The bursting of the bubble then sent a ripple effect permeating through other sectors of the economy, creating yet more unemployed resources.
For the economy to recover, a major reallocation of these idle workers and resources needed to occur. Idle workers and capital goods needed to be reshuffled to those entrepreneurs ready and willing to employ them in an attempt to meet changing consumer demands.
But this process is not short nor easy. The unemployed workers have specific skills and experience, and many may need training to acquire new skills to meet the changing labor market. Some may be unwilling to move to take new opportunities. How is a laid off bricklayer supposed to find work in a market demanding graphic designers and coders?
The capital goods no longer being utilized likewise have specific uses, and often need specific complementary goods to fulfill their role in the production process. Some of them may end up being liquidated because no entrepreneurs have a need for them. There simply may be too many bulldozers and cement mixers needed given the now smaller, post-bubble construction industry.
Recession: A Process of Re-allocating Malinvested Resources
This process of reshuffling explains the strength and duration of the recession.
Keynesian-inspired economists and politicians, unfortunately, view the idle capital and labor only in the aggregate. Their grand “stimulus” plans involve nothing more nuanced than coaxing consumer spending and business investment into spending more money on anything, anytime, anywhere.
As economic historian Robert Higgs described , “If someone, whatever his skills, preferences, or location, is unemployed, then, in this framework of thought, we may expect to put him back to work by increasing aggregate demand, regardless of what we happen to spend the money for, whether it be cosmetics or computers.”
Simply force-feeding new money into the economy will be ineffective because it takes no account of the true reason why the resources are idle in the first place.
The billions of dollars worth of public works projects, for instance, will mostly draw from labor and capital actively engaged in the private sector and fail to employ idle resources. Say, for instance, Chicago receives millions to build a new road. Can anyone honestly say for certain that the road construction will only employ workers and other inputs sitting idle in the Chicago area due to the housing bust?
Unemployed bankers and carpenters won’t be of much help laying pavement. Rather, the road project will undoubtedly divert labor and machinery actively engaged in private sector projects in the region. In the end, fewer resources will be available for productive, private sector use because they are tied up in government stimulus projects.
Meanwhile, the majority of idle workers and equipment will continue to sit idle.
Moreover, billions of available funds in the capital investment markets will be tied up by government projects; further drying up private investment opportunities.
Government stimulus spending may also artificially inflate the prices of resources, pricing them out of reach for entrepreneurs needing low-priced inputs to attract their investment during uncertain recessionary conditions. The very resources needed to generate recovery will be unavailable, having been diverted to government projects.
The best policy is for government to get out of the way and allow the reallocation of resources to occur unhampered. Government spending can only distort and prolong this process, most likely producing harmful inflationary pressure on prices along the way.
Will next time be any different?
Top political cartoonist in the world, Ben Garrison, has been attacked by the left for being so effective in his support for liberty, capitalism and President Trump.
Source: InfoWars
FILE PHOTO: People protest against the merger of Germany’s pharmaceutical and chemical maker Bayer with U.S. seeds and agrochemicals company Monsanto, before Bayer’s annual general shareholders meeting in Bonn, Germany, May 25, 2018. REUTERS/Wolfgang Rattay/File Photo
April 2, 2019
FRANKFURT (Reuters) – Bayer’s non-executive board reaffirmed its support for top management’s decision to acquire seed maker Monsanto last year, after losing high-profile lawsuits to U.S. plaintiffs who claimed Monsanto’s Roundup weedkiller caused their cancer.
In documents posted on the company’s website on Monday, the non-executive supervisory board said an expert opinion it commissioned from lawfirm Linklaters found that Bayer’s management had complied with their duties when acquiring Monsanto for $63 billion last year.
“The Supervisory Board extensively discussed this expert opinion and based on this also comes to the conclusion that the Board of Management acted in compliance with its duties,” it said.
Bayer shares have lost more than 35 percent of their value, equivalent to about 33 billion euros in market capitalization, since August, when a U.S. jury found Bayer liable because its Monsanto unit did not warn of Roundup’s alleged cancer risks. It suffered a similar courtroom defeat last month.
Although the German drugs and pesticides maker is appealing the verdicts, more than 10,000 similar cases are pending in state and federal courts, with analysts predicting the company will have to pay out billions of dollars in settlements.
Shareholders are expected to express their discontent at Bayer’s annual general meeting on April 26.
Monday’s statement by the non-executive board was published in a joint reply from Bayer’s management and supervisory boards to countermotions brought by some shareholders for the AGM.
Chief Executive Werner Baumann, who broke cover on his pursuit of Monsanto within weeks of taking the top job in 2016, has said in newspaper interviews that he enjoys the backing of the supervisory board.
The supervisory board in Germany’s two-tier corporate board system has to sign off on larger transactions and Bayer’s non-executive Chairman Werner Wenning backed the Monsanto deal throughout, according to sources familiar with the matter.
The U.S. Environmental Protection Agency, the European Chemicals Agency and other regulators have found that glyphosate, the active ingredient in Roundup, is not likely carcinogenic to humans.
The World Health Organization’s cancer arm in 2015 reached a different conclusion, classifying glyphosate as “probably carcinogenic to humans.”
(Reporting by Patricia Weiss and Ludwig Burger; Editing by Kirsten Donovan)
Source: OANN
FILE PHOTO: Ukrainian comic actor and presidential candidate Volodymyr Zelenskiy speaks following the announcement of the first exit poll in a presidential election at his campaign headquarters in Kiev, Ukraine March 31, 2019. REUTERS/Valentyn Ogirenko/File Photo
April 1, 2019
By Matthias Williams and Natalia Zinets
KIEV (Reuters) – Comedian Volodymyr Zelenskiy is leading the race to become Ukraine’s next president thanks to an insurgent campaign that rails against corrupt politicians influenced by rich oligarchs.
Yet it is his own relationship with one of the country’s wealthiest tycoons that could prove an Achilles’ heel.
One of Ukraine’s most popular TV channels 1+1, owned by oligarch Ihor Kolomoisky, has given Zelenskiy a powerful platform in recent months during his meteoric rise to the brink of the presidency.
On Saturday, a day before Zelenskiy won the first round of the presidential contest and set up a run-off with the incumbent Petro Poroshenko, 1+1 filled its schedule with back-to-back shows by the comedian and actor.
The fact that Zelenskiy is a major star on the channel has stoked worries among some investors and voters, and accusations from his political opponents, that he is in the pocket of Kolomoisky.
Both Zelenskiy and Kolomoisky say their relationship is strictly professional, and centered on the comedian’s TV work. Both say no undue influence is being exerted by the oligarch, whose businesses range from banking and energy to aviation.
“I’m more his puppet than he is mine,” Kolomoisky said last year.
“It is impossible to influence me,” Zelenskiy told the news website Gordon in December. “Neither Kolomoisky, nor any other oligarch, no one will influence me.”
Zelenskiy said last month he was in the process of exiting all his businesses, which includes the production company whose shows run on 1+1. Asked whether the relationship was a weak spot for him, Zelenskiy told Reuters: “We are working according to TV contracts and it is fine. It is business.”
However President Poroshenko has sought to make political capital out of the connection between the two men as he fights to make up ground to the comedian before the run-off vote on April 21.
“In the past few weeks my opponents have poured on me rivers of shameless lies. The main source of these lies in recent months – deplorable as it may be – has been 1+1. 1+1 has turned into the obedient implementer of the political assignments of its owner,” Poroshenko said.
“Though the latter may have fled abroad, he still plays the pre-election political chessboard, sometimes moving the Ze (Zelenskiy) pieces, sometimes the Yu (former prime Minister Yulia Tymoshenko) pieces. Kolomoisky is motivated by a desire for revenge against the state,” he wrote on Twitter.
Kolomoisky has lived abroad since clashing with Poroshenko over Ukraine’s largest bank, which he used to own. In a November interview to Ukrainian news site lb.ua, he worried Ukraine’s judicial system would stop him from leaving the country if he came back.
Zelenskiy announced he was running for president on December 31 on 1+1, upstaging Poroshenko, who was giving a traditional New Year’s Eve address to the nation at the same time.
On Saturday, the channel’s Zelenskiy-themed schedule included shows where he and fellow actors performed jokes, sketches and songs, and a documentary voiced by Zelenskiy about Ronald Reagan, a popular actor who became U.S. president.
Poroshenko is part of the same wealthy elite as Kolomoisky, having made a fortune from confectionery that earned him the sobriquet of “Chocolate King”.
“The strategic dilemma will be what do you prefer, an oligarch or someone possibly controlled by an oligarch, the puppet or a puppeteer?” said regional analyst and political consultant Radu Magdin.
‘AM I THAT CRAZY?’
Kolomoisky makes no secret of his dislike for Poroshenko, and the two have clashed repeatedly over issues that threatened Kolomoisky’s businesses.
No hard evidence has been presented by any of Zelenskiy’s opponents that Kolomoisky is indeed pulling the strings behind the campaign.
But the ties between the two men have led some political analysts and Western diplomats to question how zealously Zelenskiy would try to implement reforms needed to speed up economic growth and keep foreign aid flowing if they clashed with Kolomoisky’s interests.
In particular, the relationship puts the spotlight on the fate of PrivatBank, Ukraine’s largest lender, which the government wrested from Kolomoisky in 2016 in a clean-up of the banking system under an International Monetary Fund bailout program.
The government pumped billions of dollars into shoring up PrivatBank’s finances, saying money had been fraudulently siphoned off from the lender while Kolomoisky owned it. Kolomoisky denied any wrongdoing and has challenged the nationalization in court.
Asked if there were concerns about Zelenskiy’s ties to Kolomoisky, Edwin Gutierrez, head of Emerging Market Sovereign Debt at Aberdeen Standard Investments, said: “That is there, but at the end of the day the oligarchs always rule the roost in Ukraine.”
“Maybe this will be another Yanukovich moment where everyone gets excited but then in the end Ukraine disappoints,” he added, referring to former President Viktor Yanukovich, who fled to Russia after the 2014 Maidan street protests.
Asked in a Reuters interview whether he would hand PrivatBank back to Kolomoisky if elected, Zelenskiy said in February: “Am I that crazy? Do I want to lose my life, reputation?”
Accusations from Poroshenko and his allies that Zelenskiy is being controlled by an oligarch has lent an ironic twist to the presidential race.
Zelenskiy’s campaign has been propelled by his TV show, Servant of the People, where he plays a scrupulously honest history schoolteacher who becomes president by accident.
He challenges the old way of doing things, outwitting shadowy oligarchs and corrupt politicians. The series blurs the line between fiction and reality, between the make-believe president and the real-life challenger.
In the first scene of the first series, three shadowy power-brokers are surveying Kiev’s Maidan square from a rooftop balcony at night while sipping drinks and talking about how they spend money to bring their puppet politicians to power.
“It’s one week before the election. We worked hard for our candidates. They’re almost neck and neck, now let the best man win,” says one.
“What good will that bring me?” asks another.
(Additional reporting by Marc Jones in London; Editing by Pravin Char)
Source: OANN
Brazilian President Jair Bolsonaro, accompanied by Israeli Prime Minister Benjamin Netanyahu, pose for a photo as they visit the Western Wall in Jerusalem’s Old City. April 1, 2019 Menahem Kahana/Pool via REUTERS
April 1, 2019
By Lisandra Paraguassu
BRASILIA (Reuters) – The Palestinian ambassador to Brazil said on Monday he may be recalled home after right-wing Brazilian President Jair Bolsonaro’s new government said it will open a trade mission to Israel in Jerusalem.
Brazil’s announcement on Sunday came during a visit by Bolsonaro to Israel. It stopped short of following the United States with a full embassy move to the contested city of Jerusalem, as Bolsonaro had suggested in January. Like most countries, Brazil has an embassy in Tel Aviv.
Bolsonaro’s original proposal angered the Muslim world, and senior Brazilian officials backed away from it for fear of damaging ties with Arab countries and jeopardizing billions of dollars in Brazilian halal meat exports.
Presidential spokesman Otavio Rego Barros said on Sunday the trade mission would not be a diplomatic representation, but the move drew anger from the Palestinians.
Brazil has not officially recognized Jerusalem as Israel’s capital. Most world powers say the city’s status should only be decided as part of a peace process with the Palestinians.
Palestinian Ambassador in Brasilia Ibrahim Alzeban told Reuters that he may be recalled, although a response was still under consideration.
“From what I was told, it will depend on how (Bolsonaro’s) visit evolves,” Alzeban said. “We wish that the subject of Jerusalem had not been touched upon.”
The Palestinian Foreign Ministry said on Sunday the opening of the Jerusalem trade office was as a “a flagrant violation of international legitimacy (and) direct aggression against our people and their rights.”
Israel captured East Jerusalem along with the West Bank and Gaza in the 1967 Middle East war. Palestinians seek to establish a state in the territories, with East Jerusalem as its capital.
Alzeban said the Palestinians were also upset because Bolsonaro did not consider a visit to the Palestinian territories or coordinate his visit with Palestinian authorities.
Bolsonaro is an outspoken admirer of U.S. President Donald Trump, who broke with consensus by recognizing Jerusalem as Israel’s capital and moving the U.S. embassy there last year.
Israeli Prime Minister Benjamin Netanyahu has said he hopes that Brazil’s Jerusalem trade office is a step toward moving the embassy to the city.
“There is no recognition of Jerusalem as the capital,” Brazilian presidential spokesman Barros said. “Our president continues to evaluate this possibility (of moving the embassy), but that is not what we decided at this time.”
(Reporting by Lisandra Paraguassu; Writing by Jake Spring; Editing by Susan Thomas)
Source: OANN
The logo of Romanian integrated oil company OMV Petrom is pictured outside its headquarters in Bucharest, Romania, March 28, 2019. Inquam Photos/Octav Ganea via REUTERS
April 1, 2019
By Luiza Ilie and Kirsti Knolle
BUCHAREST (Reuters) – Romania’s new energy regulations risk undermining plans by companies to develop big offshore gas projects in the Black Sea, putting billions of dollars of revenue at risk and squandering a chance to challenge Russia’s Gazprom in the region.
Oil industry officials have warned the changes, which include a cap on some gas prices for local producers until 2022 and a 2 percent turnover tax on all energy firms bar state-owned coal-fired power plants, could slash investment plans.
OMV Petrom, which is developing a Romanian gas field with ExxonMobil, said key conditions for the project were still not in place while Black Sea Oil & Gas, controlled by private equity firm The Carlyle Group, warned it could pull out of another project if the rules remain.
The European Commission also told Romania in March that gas export restrictions and regulated prices probably contravene EU rules and could be challenged by Brussels.
Most of the new measures, first announced in an emergency decree in December, were confirmed on Friday.
The government made a last-minute concession, eliminating a cap on gas prices for industrial consumers. That means producers only have to sell about a third of their output at a fixed price – to households and heating plants – rather than more than half.
But the concession was not enough to placate the companies, given that the turnover tax and new export restrictions approved last year remain in force, coupled with the risk the state could simply shift the goal posts again.
Romania now risks delaying offshore gas projects and playing into the hands of Russia, which blocked Ukraine from exploring its Black Sea resources by occupying Crimea, analysts said.
“Postponement doesn’t benefit anyone, not the state, consumers, the economy, investors,” said Razvan Nicolescu, executive lead advisor in Deloitte’s energy and resources division in Bucharest. “The only winner is Gazprom, the sole gas provider in the region.”
Romania’s Black Sea gas has the potential to challenge Gazprom’s dominant role in central and eastern Europe, diversify gas supplies and bring the Romanian government revenue of $26 billion by 2040, according to the consultancy.
Romania’s offshore gas reserves are estimated at 200 billion cubic metres. Russia, meanwhile, has proven reserves of 35 trillion cubic metres, according to BP’s statistical review.
But while German consumption alone would empty the Romanian gas fields in two years, they could cover the combined 2017 demand of Romania, Bulgaria, Serbia, Hungary and Moldova for more than six years.
“Any cubic metre of gas produced in Romania means one less cubic metre produced and sold by Russia. Access to markets and a market share as high as possible are very important economic stakes,” said Nicolescu.
DEAL BREAKERS?
Several gas producers have spent upwards of a decade and billions of dollars preparing to tap Romania’s Black Sea gas, but they were blindsided by the government decree. Lawmakers also approved export restrictions on offshore gas producers.
The ruling Social Democrats, gearing up for four elections this year and next, have said the gas price cap was designed to keep tariffs low for domestic users.
“As we have said before, we want to protect the household consumer,” Energy Minister Anton Anton said on Friday.
Black Sea Oil & Gas (BSOG) decided earlier this year to press ahead with plans to extract an estimated 10 billion cubic metres of gas from shallow waters – given the amount of money it has already invested.
But CEO Mark Beacom told Reuters the changes undermined the willingness of investors to move forward and were contrary to earlier assurances and legal provisions provided by the state.
“The new proposed measures taken by the government are not the best way to protect vulnerable consumers and are not sufficient to mitigate all the harmful measures recently put in place,” he said on Monday.
Beacom said the entire emergency decree should be revoked, as well as additional fees and export restrictions brought in by parliament last year.
“There are always deal breakers in many different areas that could cause the investment to be terminated,” he said in March.
“We look forward to having a constructive engagement with the relevant authorities to seek resolution on these issues but do not exclude the possibility of pursuing a legal course of action should such engagement not result in a positive outcome.”
ExxonMobil and OMV Petrom, controlled by Austria’s OMV, had planned to give the final green light for their deep water Neptun project last year, having spent nearly $2 billion to prepare for production at one of the EU’s most significant natural gas deposits.
The project is now on hold.
OMV Petrom chief executive Christina Verchere said on Friday that removing the gas price cap for industrial customers answered some but not all of the industry’s concerns and further talks were needed.
“Development of the Black Sea is a huge opportunity for both OMV Petrom and Romania, however, key requirements are currently not in place,” she said. “Consultation with the business environment, predictability and legislative and fiscal stability are the foundation for stimulating investment.”
ExxonMobil spokeswoman Julie King said the company was looking forward “to continuing our discussions with the Romanian government, parliament and relevant institutions as project evaluations continue”.
SORE POINT
According to a study commissioned by Romanian oil producers (ROPEPCA), the measures would cost the government $540 million in taxes a year and slash investment and production.
While Romania is almost energy independent – it only gets 10 percent of its needs from Russia – gas imports in the first month of 2019 were roughly 60 percent higher than a year ago, data from gas pipeline operator Transgaz showed.
“It is a negative message for the business sector in general, and the result is a feeling of uncertainty and distrust,” ROPEPCA told Reuters.
“Major infrastructure and development projects, both on and offshore will most likely be suspended.”
In March, Transgaz shareholders rejected its 1.9 billion euro ($2.1 billion) investment program, which includes works on an EU-backed pipeline connecting Bulgaria, Romania, Hungary and Austria (BRUA) as well as a domestic pipeline to transport future offshore gas production.
A sore point for gas producers is the obligation to sell gas at 68 lei ($16) per megawatt hour until Feb. 2022, about 15 percent lower than the estimated average market price.
While only capping prices for some gas consumers takes some of the sting out of the measures, energy companies said enforcing it solely for producers but excluding distributors was discriminatory as they could pass on their costs to households.
“You can look after the vulnerable customer while at the same time not taking it at the cost of energy supply that you want on the market,” OMV Petrom’s Verchere has said.
(Reporting by Luiza Ilie in Bucharest and Kirsti Knolle in Vienna; additional reporting by Gary McWilliams in Houston; editing by David Clarke)
Source: OANN
FILE PHOTO: A child holds national flags of China and the Philippines in Beijing, China, October 20, 2016. REUTERS/Thomas Peter
April 1, 2019
MANILA (Reuters) – The Philippines has filed a diplomatic protest over the presence of more than 200 Chinese boats near an island occupied by Manila in the disputed South China Sea, the president’s spokesman said on Monday.
President Rodrigo Duterte has pursued warmer ties with China since taking office in 2016 in exchange for billions of dollars of pledged loans and investment.
The Department of Foreign Affairs protested against the vessels near the Philippines-occupied Thitu island, presidential spokesman Salvador Panelo told a regular news conference, without describing the boats. The Chinese ambassador said they were fishing boats.
“The mere fact that they are there and just staying there for a week, why, what are they doing there?” Panelo said. It was unclear when and where the Philippines filed the protest.
The Philippines monitored more than 200 Chinese boats near Thitu, locally called Pagasa, in January to March this year, military data showed.
The Philippines, China, Vietnam, Taiwan, Brunei and Malaysia have competing claims of sovereignty in the waterway, a conduit for in excess of $3.4 trillion of goods.
Lights from hundreds of buildings in China’s sprawling artificial islands can be seen at night from Thitu.
Both Chinese and Filipino fishermen are present in the contested waters, Zhao Jianhua, China’s ambassador to the Philippines, told reporters. He denied media reports that Chinese fishermen were carrying firearms.
Beijing and Manila were handling maritime issues through friendly and diplomatic channels, Zhao said.
“You don’t have to worry about whether there would be any kind of outbreak of conflict or not,” he said.
The announcement of the diplomatic protest came as the Philippines and United States, a treaty ally, kicked off an annual joint military exercise involving roughly 7,500 troops, including 50 from Australia.
They are aimed at enhancing response to natural disasters.
“It’s not directed to any threat or existing security concern,” military exercise director Lt. Gen. Gilbert Gapay told reporters.
Last month, U.S. Secretary of State Mike Pompeo assured the Philippines it would come to its defense if it came under attack in the South China Sea.
(Reporting by Neil Jerome Morales; Additional Reporting by Karen Lema; Editing by Nick Macfie)
Source: OANN
COMMENTARY
X
Story Stream
recent articles
Socialist politicians have been getting a lot of attention lately but the good news is they haven’t been getting much done. Last week a major legislative setback for socialism in Washington was followed by a remarkable vote of confidence in American capitalism by investors at home and abroad.
Few pieces of legislation have enjoyed as much buzz as the Green New Deal from Rep. Alexandria Ocasio-Cortez and Sen. Ed Markey. So grand are its socialist ambitions that converting the entire U.S. health care system to government management is just one part of an economic overhaul estimated to cost as much as $94 trillion over 10 years.
But putting the Green New Deal to a vote on the Senate floor turned out to be a buzzkill for socialists. Not a single senator voted for it, all Republicans voted against, and the GOP was joined in opposition by Democrats Doug Jones of Alabama, Joe Manchin of West Virginia and Kyrsten Sinema of Arizona, along with Maine independent Angus King, who caucuses with Democrats. All the Senate Democrats running for president voted “present” even though they had all signed their names as co-sponsors of the Green New Deal.
While socialist economics was getting whacked in Washington, outside the Beltway capitalists were preparing for what could be a historic year for the creation of publicly traded corporations. On Thursday the money-losing ride-hailing service Lyft responded to huge investor demand by increasing the price of shares in its initial public offering. Despite being a distant second to Uber in the young industry of connecting riders with drivers, Lyft raised its IPO price to $72 per share and a total valuation of more than $23 billion and traded up from there.
Capitalists like to talk about animal spirits in a healthy market — the instinct to take risks and seize opportunities in an open and competitive economy. The animal spirits in this space have been so spirited and excited about the possibilities of ride-hailing and driverless cars that they’ve been pouring billions into Lyft and Uber despite years of losses. Now the capitalists who invest in U.S. stocks are showing that same spirit, and not just for young tech stars. Iconic jeans maker Levi Strauss & Co. went public last week for the second time in its 166-year history and its shares have been trading more than 30% above the offering price.
Expect Uber to also go public soon, with a valuation that may exceed $120 billion. The ride-hailing giant could be followed quickly into the public markets by other “unicorns” — start-ups valued above $1 billion. Workplace messaging app Slack, home rental platform Airbnb, Elon Musk’s rocket company Space X, stationary bike and related media seller Peloton and photo-sharing app Pinterest are also likely 2019 IPO candidates.
Buyers should be careful because the rush to sell shares to the public may reflect in part a belief among early private investors that markets are frothy and the economy is in the later stages of a recovery. But the increasing desire of private companies to go public is also a welcome sign of a robust economy that has driven markets higher as well as policy changes focused on allowing everyday investors to own America’s most innovative companies.
Neil Dhar, a partner at accounting giant PwC, tells me that “we’re living in a bit more of a deregulated environment.” He expects a surge of IPO activity over the next several months.
Make no mistake, entrepreneurs and venture capitalists deserve the credit for creating new businesses. But when it comes to a more welcoming environment for companies considering going public, both President Trump and former President Obama helped build this.
Trump tax cuts and deregulation have driven economic growth and stock market valuations higher, enticing start-ups to sell shares to the public. Meanwhile, Trump’s Securities and Exchange Commission chairman, Jay Clayton, has been seeking to maximize the benefits of Obama’s 2012 JOBS Act, which sought to make it easier for young companies to prepare for a public offering and test investor appetite before having to make wholesale public disclosures.
A surge of new public companies would represent a big change. Backed by abundant venture capital and free of the regulatory hassles imposed on public companies, start-ups in recent years have often chosen to remain private — even as their revenues and valuations soared. The result is a smaller menu of companies for retail investors to consider. Clayton noted last year that exchange-listed operating companies in the U.S. numbered fewer than 4,500, down about 40% from the 7,400 that were listed at the end of 1998. This means fewer options for mom-and-pop investors.
But this year should mark a sharp departure from this trend following an encouraging 2018. Renaissance Capital reports that last year the IPO market hit a four-year high with 191 IPOs and $47 billion in proceeds. 2019 should be much bigger.
A great year for new companies will require calm or rising markets, a tall order given slowing global growth and continued uncertainty about trade and interest rates. But individual investors who enjoy using apps created by companies like Uber and Pinterest should soon be able to own them, too. Just like the institutional players, individuals still want to back young and innovative companies with the potential to change the world. This is no guarantee of great returns, but opportunities that have only been available to the wealthy are becoming options for the average investor. And this could mean a lot of bad days ahead for capitalism’s critics. Could socialists get sick of losing?
Pope Francis addresses reporters aboard the plane bringing him back following a two-day trip to Morocco March 31, 2019. Alberto Pizzoli/Pool via REUTERS
March 31, 2019
By Philip Pullella
ABOARD THE PAPAL PLANE (Reuters) – Pope Francis on Sunday defended his decision to reject the resignation of Philippe Barbarin, the French Roman Catholic cardinal convicted on charges of failing to report sexual abuse.
Speaking to reporters on the plane returning from a two-day trip to Morocco, Francis said he was obliged to give the archbishop of Lyon the benefit of the doubt until his appeal is heard.
“I can’t accept it because in juridical terms, in classic world jurisprudence, there is the presumption of innocence as long as the case is open, and he has appealed,” Francis said.
Barbarin offered his resignation when he met the pope on March 18.
A court in Lyon ruled on March 7 that between July 2014 and June 2015, Barbarin covered up allegations of sexual abuse of boy scouts in the 1980s and early 1990s by a priest who is due to go on trial later this year.
Barbarin, 68, the highest-profile cleric to be caught up in the child sex abuse scandal inside the French Church, received a six-month suspended prison sentence. He has denied the allegations and launched an appeal.
“When the second court hands down its decision, then we will see what will happen. But we must always have the presumption of innocence. This is important because it goes beyond the superficial condemnation by the media,” the pope said.
“Maybe he is not innocent, but the presumption (of innocence) must be there,” the pope said.
The Barbarin trial put one of Europe’s most senior clergymen in the spotlight at a time when the pope is grappling with criticism over the Church’s response to a decades-long sexual global abuse crisis.
Barbarin has stepped aside temporarily pending the appeal and has handed over the day-to-day running of the diocese to a vicar general.
He has said he would remain head of the dioceses in title and would continue to sign off on documents until the appeal process is over.
The Church’s credibility has been damaged in much of the world by abuse scandals in countries including Ireland, Chile, Australia, France, the United States and Poland, paying billions of dollars in damages to victims and forcing parishes to close.
The scandals have reached the upper echelons of the Vatican itself with the conviction of Cardinal George Pell, jailed this month for six years for abusing boys in his native Australia. He had served as the Vatican treasurer and a member of the pope’s innermost council of cardinals until his conviction last year.
(Reporting by Philip Pullella; Editing by Peter Cooney)
Source: OANN
MAGA One Radio