November | 2018 |

Donald Trump, Xi Jinping meet to discuss US-China trade war
November 30, 2018 admin Comment

But to some experts, the real issue is China’s growing influence on the global stage, which they say the U.S. wants to curb.

“We can’t expect a deal of breakthrough that fundamentally solves the issues between the United States and China because they’re too profound, they’re too deep, there are too many of them,” said Robert Daly, director of the Kissinger Institute on China and the United States at Woodrow Wilson International Center for Scholars.

“It’s not simply trade friction because the countries are involved in a global competition for pre-eminence which includes trade regime, security architectures, norms and practices, values and ideologies and there’s really nothing that Xi Jinping can put on the table that will satisfy Trump’s demand for structural change within China,” Daly told CNBC’s Sri Jegarajah on Thursday.

The Fed has caved to President Trump’s wishes and that’s a game changer
November 29, 2018 admin Comment

In terms, of the first message it is clear that this Federal Reserve has a strong allegiance to President Trump. My assumption is that it might even be closer than Richard Nixon’s Fed was to him during his Presidency. President Trump has nominated four of the five current members of the Federal Reserve Board to their current positions – including Mr. Powell. Repeating, he has already placed people who have congenial views to his in every governmental agency that has any relationship to banking.

He expects his nominees to act in a fashion that facilitates his economic agenda and they are doing so. The pressures on banks have eased meaningfully since the days of the hardliners when banking was being de facto nationalized.

The second message from Mr. Powell’s speech is that the Fed may ease its pressure on the financial system (and abandon the concept of a neutral rate). It should be understood that this Fed was involved in more than just raising interest rates. It was fundamentally changing its core policies as shown in the past three decades.

In the prior period, the Fed had made money available in large amounts at unusually low interest rates when needed. The Powell Fed was reducing the availability of money and raising its costs. A policy change of this magnitude requires more than five people sitting behind closed doors making decisions. It requires a much broader discussion and hopefully that will happen.

At the moment though the game has changed and the Fed has removed itself from a central position in the economic debate. Whether this is positive or not remains to be seen.

China trade hawk Navarro is reportedly attending the Trump-Xi dinner
November 29, 2018 admin Comment

White House trade policy advisor and China hawk Peter Navarro will be attending a crucial meeting between President Donald Trump and Chinese president Xi Jinping this week, a White House official confirmed to CNBC.

Navarro’s presence at the meeting pours cold water on investors’ hopes of a trade deal.

The news was first reported by the South China Morning Post, sending the Dow Jones Industrial Average briefly to its low of the day. The newspaper had reported last week that Navarro would not attend the Xi-Trump meeting.

The closely watched dinner during the G-20 summit in Buenos Aires this week should provide a some answers in the escalating trade war between Beijing and Washington.

The two countries are still in the process of finalizing the list of advisors who will take part in the meeting, the South China Morning Post said. The world’s two largest economies have struggled to reach a trade deal and de-escalate tensions that have led to increasing tariffs.

Navarro has taken an aggressive stance toward any changes in the U.S. trade relationship with China. Earlier in November, he said a potential deal with China “will be on President Donald J. Trump’s terms. Not Wall Street’s terms.” He added that “there will be a stench around any deal that’s consummated” because of Wall Street’s involvement. The comments helped drag stocks lower that day.

President Donald Trump’s top economic advisor Larry Kudlow disavowed Navarro’s comments, telling CNBC “he was not speaking for the president, nor was he speaking for the administration.”

“I think Peter very badly misspoke,” said Kudlow, who took over as director of the National Economic Council earlier this year. “He was freelancing and he’s not representing the president or the administration.”

The White House did not immediately return an email for comment.

Trump has pushed for Beijing to make changes to reduce the U.S. trade deficit with China, and to address alleged Chinese theft of American intellectual property. The president has threatened to put tariffs on another $257 billion in Chinese imports, in addition to the duties already in place on $250 billion in goods.

In response, China has said it would slap taxes on 5,207 U.S. imports worth about $60 billion. The countries had imposed tariffs on $50 billion of each other’s goods before sanctions in September.

Cloud storage firm Box reports smaller-than-expected loss, shares rise
November 29, 2018 admin Comment

Cloud storage provider Box reported a smaller-than-expected quarterly loss as it added more customers, and forecast full-year revenue estimates above analysts’ estimates.

The company’s shares, which have fallen about 14 percent this year, rose 5 percent in extended trading.

Box ended its third quarter with more than 90,000 paying customers, up from 87,000 in the preceding quarter.

“From Medtronic to Coca-Cola to Eli Lilly, large enterprises are deciding to choose Box,” Chief Executive Officer Aaron Levie told Reuters.

“I think where we could have done better is in Europe, we still have seen some markets not all perform up to the level that we like,” he added.

For full year 2019, Box forecast an adjusted loss of between 15 cents and 16 cents per share and revenue between $608.2 million to $609.2 million.

Analysts, on average, were expecting a loss of 17 cents per share on revenue of $607.5, according to IBES data from Refinitiv.

The company, which also competes with Microsoft’s OneDrive and Google’s Drive, also forecast current quarter revenue between $163.5 million to $164.5 million and said it expects to post an adjusted profit between 2 cents to 3 cents per share.

Analysts were expecting the company to report a profit of 2 cents per share on revenue of $164.3 million.

“The important thing for the stock to work is to see evidence that underlying growth can accelerate next year,” said Rishi Jaluria, an analyst at DA Davidson & Co.

Excluding items, Box reported a loss of 6 cents per share in the third quarter, below the average analyst estimate of loss of 7 cents per share.

The company’s net loss narrowed to $40.2 million, or 28 cents per share, in the quarter ended Oct. 31, from $42.9 million, or 32 cents per share, a year earlier.

The Redwood City, California-based company’s revenue rose 20.6 percent to $155.9 million. Analysts were expecting revenue of $154.6 million.

Morgan Stanley warns of rising auto prices
November 29, 2018 admin Comment

Morgan Stanley has warned of higher car prices following signs of further escalation in the U.S.-China trade war.

U.S. Trade Representative Robert Lighthizer announced Wednesday that he was examining ways to raise duties on Chinese vehicles to 40 percent, which is the tax that Beijing now levies on American-made cars. Such tensions are likely to hurt both auto consumers and manufacturers, Adam Jones, Morgan Stanley’s chief U.S. auto analyst, told CNBC’s Sri Jegarajah on Thursday.

“The auto industry is the quintessential global supply chain,” Jones said at the Morgan Stanley Asia Pacific Summit in Singapore. “Any disruption of trade — be it between China and the U.S., or Europe and the U.S. or Japan, you name it — is going to lead to inflation.”

But as the costs of doing business increases, “that’s going to either make cars more expensive, which will hurt demand, or hurt margins. Probably a little of both,” he continued.

China fintech revolution could be ‘a very big risk’: Phoenix Capital
November 29, 2018 admin Comment

Dave Zhong | Getty Images Entertainment | Getty Images

Vince Zhang, President of Phoenix Finance, speaks during Fireside Chat on Day 3 of CNBC East Tech West on November 29, 2018 in Nansha, Guangzhou, China.

“A lot of companies are not (there) in terms of their business plan, in terms of their risk management process, in terms of their overall management,” told the Financial Times’ Louise Lucas Thursday. “A lot of these corporate control mechanisms are not in place.”

In recent years, China has seen a surge in the number of companies trying to harness technology to capitalize on what Zhang described as China’s “fintech revolution” and capture the country’s many millions of previously unbanked consumers. For other industries, that technological drive may be “okay,” said Zhang; but “for anything related to financial services, (it) is pretty dangerous,” he said.

Imran Khan former Snap chief strategy officer
November 29, 2018 admin Comment

Dave Zhong | Getty Images

Imran Khan, former chief strategy officer of Snap, speaks during Fireside Chat on Day 3 of CNBC East Tech West at LN Garden Hotel Nansha Guangzhou.

Snap’s former chief strategy officer believes that while companies should be wary of their competitors, they must not forget to focus on their customers.

“I think that so many companies always forget who their customers are,” Imran Khan told CNBC’s Deirdre Bosa during a fireside chat at the East Tech West conference held in the Nansha district of Guangzhou, China. “Once you identify who your customers are, you have to be maniacally focused on serving that customers the best.”

Khan recently left Snap to start a new e-commerce business that will put him in direct competition with tech juggernaut Amazon, which is predicted to take nearly half of the U.S. online retail market by year’s end.

“Big is not always better,” he said. “If you look at the history of innovation, if big was always better, new companies would never come up.”

Khan explained that despite Amazon’s massive presence, the U.S. e-commerce market, as a percentage of total retail sales, was still small. That left enough room for smaller companies to innovate and take some market share.

“I think you should always be very fearful of your competition but you shouldn’t let fear drive it,” he said when asked if he was worried about Amazon.

But the former Snap executive declined to reveal details about what his start-up will do.

His e-commerce venture is predicted to launch in time for the holiday shopping season 2019, and recently raised $17.5 million in funds from investors including Lightspeed Venture Partners, according to Axios. The news site added that the company will be aimed at millennials.

For every dollar a man earns, a woman earns 49 cents
November 28, 2018 admin Comment

Women may face a much wider wage gap than commonly cited data indicates, earning just half of what men earn over 15 years. That’s according to a new study by economists who analyzed the incomes of men and women who worked for at least one year between 2001 and 2015.

The standard annual wage gap measured by the Census Bureau shows that women make 80 cents for every dollar earned by a man. But this statistic leaves many women workers out of the picture, Heidi Hartmann, the president of the Institute for Women’s Policy Research and an author of the study, tells CNBC Make It.

IWPR’s methodology incorporates workforce attachment — those more “strongly attached” to the workforce are defined as working at least 12 out of 15 years full-time and year-round — and looks closely at both the consistency and long-term growth of earnings to capture a more nuanced picture of women’s careers.

Census data, on the other hand, compares the earnings of men and women who work full-time in one given year. But women are less likely to work full-time on a consistent basis throughout their careers, and take more time out of the labor force to raise children, care for family or spend more time on education, Hartmann says.

The IWPR research attempts to more fully compare women’s and men’s earnings by taking a career-long view. The study found stark earning gaps in three periods of analysis: Between 1968 and 1982, women’s earnings were 19 percent of men’s. Between 1983 and 1997, they rose to 38 percent. Between 2001 and 2015, they rose, but not significantly: over that 15-year period, women made 49 percent of what men made.

The study also found that penalties for taking time off from work are especially high for women. For women who took one year off from work, annual earnings were 39 percent lower than those of women who worked all ever year between 2001 and 2015. For comparison, women who took one year off from work in the 15 years beginning in 1968 saw a 12 percent cut in earnings.

Men are also penalized for time out of the workforce, but women’s losses are almost always greater than men’s, the study found. Hartmann says she was surprised by the results of her own study: “I would have expected a bigger change in progress in this last 15 year period.”

Despite considerable progress over the last 50 years, 43 percent of today’s women workers had at least one year with no earnings, nearly twice the rate of men. Strengthening women’s labor force attachment, Hartmann says, is critical to narrowing that gap.

Policies like paid family and medical leave and affordable child care can increase women’s labor force participation and encourage men to share more of the unpaid time spent on family care, the study emphasizes.

“Women get paid less in the same jobs as men, which is typical, garden variety discrimination. Add to that public knowledge that sexual harassment is endemic,” says Hartmann. “The fact is, we need stronger stronger equal employment opportunity enforcement and more family support.”

Like this story? Subscribe to CNBC Make It on YouTube!

Don’t miss:

A historic number of women were elected in 2018—these four are expected to run for president in 2020

Study: 80% of women would leave a company for one that offered better gender equality

Ford cuts shifts at factories in Kentucky and Michigan, but keeps jobs
November 28, 2018 admin Comment

Luke Sharrett | Bloomberg | Getty Images

An employee works on a Ford Expedition sports utility vehicle on the assembly line at the Ford Kentucky Truck Plant in Louisville, Kentucky.

Ford is cutting a shift at two of its plants, but the automaker’s avoiding layoffs by moving workers to other facilities, the company said Wednesday.

The automaker is shifting about 500 workers from its Louisville Assembly plant to its Kentucky Truck Plant — both in Kentucky — to increase production of the Ford Expedition and Lincoln Navigator, which are both experiencing strong sales.

It will also move 500 jobs from its Flat Rock Assembly Plant to its Livonia Transmission plant, which makes transmissions for several vehicles, including its F-150 full-size pickup and the Ranger, a mid-size pickup Ford is reintroducing after 8 years. Both plants are in Michigan.

Ford makes the Ford Escape and the Lincoln MKC, both compact crossover vehicles, at the Louisvile Assembly plant, and the Mustang sports car at Flat Rock.

Higher demand for pricey pickups and SUVs, have helped automakers, particularly American ones, weather falling sales this year. Ford is especially strong in larger pickups and SUVs. Ford Expedition sales in October increased 36 percent from one year ago, while Lincoln Navigator rose more than 80 percent over the same month in 2017. At the same time, sales of the Escape fell 7 percent, the MKC 8.5 percent, and the Mustang 6 percent.

“Our collectively bargained contract provides for the placement of all members displaced by the shift reduction and, after working with Ford, we are confident that all impacted employees will have the opportunity to work at nearby facilities,” said United Auto Workers Union vice president Rory Gamble.

Watch Fed Chairman Jerome Powell speak to the Economic Club of New York
November 28, 2018 admin Comment

[The stream is slated to start at 12 pm ET. Please refresh the page if you do not see a player above at that time.]

Federal Reserve chairman Jerome Powell is scheduled to deliver a speech to the Economic Club of New York shortly after noon ET.

Markets are watching the speech closely for clues about the future path of monetary policy. The Fed is widely expected to increase its short-term benchmark rate by a quarter point in December, but expectations diverge from there. Powell jolted markets in early October when he said the Fed is “a long way” from a neutral rate that is neither stimulative nor restrictive.

Read more:
Fed warns that a ‘particularly large’ plunge in market prices is possible if risks materialize
Mnuchin reportedly asked around to see if there are alternatives to Fed rate hikes
Here’s what to expect from Fed Chief Powell’s most important speech yet

12 3 ›»

Articles from November 2018