Forget about bank doom loop stories over residential mortgages. Instead put the spotlight where it belongs.

Not Residential!

A reader asked me to comment on Peter Schiff: Banks Have a Bigger Real Estate Problem Today Than They Did in 2007.

Banks are more vulnerable to the housing market now than they were in 2007.

Most people in the mainstream will scoff at that statement. They’ll tell you that the situation is very different today. After all, we don’t have a big problem in the subprime mortgage market. We’re not seeing a big spike in defaults. That’s true. The problem is different this time. And it’s actually worse.

So, what’s the problem?

As Peter Schiff explained in a recent podcast, the problem this time is the mortgages themselves.

As Peter points out, a 3% mortgage is a huge asset for the borrower. But it’s a huge liability for the lender. So, defaults would benefit the banks. They could theoretically repossess the home and resell it to somebody else and write a mortgage at a much higher rate.

So, this is a very different crisis. But it’s worse because they’re losing money on every single mortgage they have whether or not they go into default. … So, this is bigger. It is a bigger problem for the banks. They’re losing more money, and they will lose more money now than they did in 2008. That means we’ll need an even bigger bailout. All these ‘too big to fail’ banks have an even bigger problem now than they did then, and it’s going to take an even bigger round of QE to bail them out. The problem is how’s the Fed going to do that when inflation is as high as it is and going higher?

Total Silliness

For starters, banks tend to securitize mortgages they originate or dump them on Fannie Mae.

Second, few will be walking away. There is too much equity for a default crisis as happened in 2007.

Third, the Fed has a liquidity program (BTFP explained below) to help banks paper over losses.

Runs on banks have stopped. If bank runs start again, it will not be due to residential mortgages.

Fed’s Emergency Liquidity Program

BTFP funding data from the St. Louis Fed

The Fed started the BTFP program in the wake of the collapse of Silicon Valley Bank.

Small regional banks overleveraged in long term treasuries and were clobbered by paper losses and then bank runs.

In response, the Fed agreed to shield the banks from losses by offering swaps at par value, ignoring the losses.

BTFP Terms

• Eligible Collateral—Direct obligations of certain U.S. government agencies, including the U.S. Department of the Treasury, government-sponsored enterprises such as Fannie Mae and Freddie Mac, and the Federal Home Loan Banks. In addition, mortgage-backed securities issued and/or fully guaranteed by Ginnie Mae, Fannie Mae and Freddie Mac are eligible.
• Loan Terms—Institutions may borrow up to the value of eligible collateral pledged. Collateral is valued at par, i.e., with no haircuts. Loans can be prepaid at any time without penalty. The rate is fixed for the life of the loan (up to one year) and is calculated by adding 10 basis points to the overnight index swap rate. The rate is published daily on the Discount Window website. Advances will be available until March 11, 2024, or longer if the program is extended.

Liquidity, Not Solvency Issue

This is a liquidity issue, not a solvency issue. The US is not going to default and the treasuries are not worthless. The Fed wanted to stop bank runs and did so by a method that hides losses.

However, the paper losses are still real, even if hidden in reports. This has an impact on banks willingness to make loans in a rising interest rate environment.

For further discussion, please see The Fed’s Emergency Liquidity Program, BTFP, is Over $100 Billion, What’s Going On?

Commercial Real-Estate Doom Loop

The Wall Street Journal reports Real-Estate Doom Loop Threatens America’s Banks, but the loop is commercial.

Bank OZK had two branches in rural Arkansas when chief executive officer George Gleason bought it in 1979. The Little Rock lender today has billions of dollars in commercial real-estate loans, including for properties in Miami and Manhattan, where it is helping fund the construction of a 1,000-foot-tall office and luxury residential tower on Fifth Avenue.

Regional banks across the country followed a similar playbook, gorging on commercial real-estate loans and related investments in big cities over the past decade.

With the commercial real-estate market now in meltdown, those trillions of dollars in loans and investments are a looming threat for the banking industry—and potentially the broader economy. Banks’ exposure is even bigger than commonly reported. The banks are in danger of setting off a doom-loop scenario where losses on the loans trigger banks to cut lending, which leads to further drops in property prices and yet more losses.

The doom-loop scenario is starting to play out in big cities where office vacancies have soared. Real-estate investors that are unable to refinance their debt, or can only do it at high rates, are defaulting. The lenders, no longer getting the debt payments, often have to write down the value of those mortgages. Sometimes the bank ends up owning the property.

“The plumbing is clogged right now,” said Scott Rechler, chief executive of real-estate investor RXR. “And that is going to create a backup that will eventually overflow on the commercial real-estate markets and on the banking system.”

US Regional and Small Banks’ CRE Exposure Could Pressure Ratings

Fitch reports US Regional and Small Banks’ CRE Exposure Could Pressure Ratings

U.S. banks with less than $100 billion in assets are more susceptible to deteriorating commercial real estate (CRE) fundamentals than larger banks, which could add to ratings pressure, given their higher relative exposure as a percentage of assets and total capital, Fitch Ratings says.

The tight monetary environment has placed pressure on most CRE properties’ collateral values and transaction volumes while structural changes in demand for office space have adversely impacted occupancy for that asset class. These factors increase credit risk for banks that have CRE loan concentrations, and are expected to have an impact on asset quality in CRE loan portfolios of U.S. banks.

Banks with more concentrated CRE exposure to office markets, particularly those with much weaker vacancy trends, face moderate stress over the near- to medium-term. For example, larger cities, including San Francisco, Houston, Dallas/Ft. Worth, Washington DC and Chicago had high office vacancy rates as of 1Q23.

BTFP Eligible Collateral

Look again at the BTFP eligible collateral. It includes Fannie Mae, Freddie Mac, Ginnie Mae. It does not include commercial real estate, or any other kind of bank loans.

CRE and other types of bank loans are solvency issues.

By shielding mortgages and Treasuries, the Fed contained any residential mortgage crisis.

The big problem for banks is commercial but the residential housing market is in shambles.

How the Fed Destroyed the Housing Market and Created Inflation in Pictures

The Fed has a big problem of its own making on its hands that will make inflation harder to control.

For discussion, please see How the Fed Destroyed the Housing Market and Created Inflation in Pictures.

The Fed destroyed the housing market, but this will have minimal impact on banks. Commercial real estate is the key issue.

The post Banks Have a Large Actual Property Drawback However It’s Business, Not Residential – MishTalk appeared first on DAILY SAN FRANCISCO BAY NEWS.

By Mark Jurkowitz | Outer Banks Voice on September 18, 2023

Woda Cooper official Denis Blackburn at a Nags Head Commissioners meeting last year. The company’s proposed 54-unit project was rejected there.

Two weeks after its proposal was unanimously rejected by the Manteo Board of Commissioners, the Dare County Commissioners will be looking for a way to move forward on a planned Woda Cooper housing development when they meet on Tuesday, Sept. 19, in special session.

The latest in a growing string of housing setbacks for the county came on Sept. 6 when the Manteo Commissioners voted against allowing the proposed 46-unit development at the end of Bowsertown Road to be connected to the town’s wastewater system. That marked the second time in the past few years that the Manteo Board has rejected such a hookup, although the first project was much larger, at a planned 120 units.

After the Sept. 6 verdict in Manteo, Dare County Manager Bobby Outten told the Voice that “we’re disappointed in the Manteo decision, but we’re going to continue to work to bring workforce or essential housing to the county.”

In a brief email to the Voice, Outten said the idea of the Sept. 19 Dare Commissioners meeting is “to find a way to move forward, not necessarily in Manteo.”

Thus far, county efforts to build what they call workforce or essential housing has run into a wall of opposition at the local level—with municipal commissioners, reflecting the view of many constituents, soundly rejecting several proposals involving the county’s development partners, Woda Cooper and Coastal Affordable Housing, LLC.

In August 2022, the Kill Devil Hills Commissioners defeated an effort to rezone the 44-acre Baum tract to potentially pave the way for a high-density multifamily housing site envisioned by Coastal Affordable Housing and the county. And early this year, the Nags Head Commissioners, responding to significant community opposition, opted to rezone an area that would have potentially housed a 54-unit Woda Cooper housing development.

In unincorporated Wanchese, which is governed by the Dare County Board of Commissioners, that board’s May 1 approval of a 60-unit cluster home development occurred in the face of impassioned efforts from a community that turned out in force at a series of meetings to register their staunch opposition.

And even after greenlighting the cluster home project, the Dare Commissioners, acknowledging that intense level of opposition, voted to remove 22 districts from the cluster home ordinance that had paved the way for the Wanchese project.

As the county tries on Sept. 19 to come up with a way to bring the Woda Cooper housing plan to fruition, it is seeking a thus far elusive victory on the housing front. And for his part, Outten hopes that one success will lead to others.

“It’s much like beach nourishment was back in the early 90’s,” he told the Voice earlier this year. “Everybody was reluctant until we finally did it and found that it was beneficial, wasn’t harmful, and was a good thing.”

NOTICE TO CONTRACTORS: BIDDER PRE-QUALIFICATION REQUEST:

Barnhill Contracting Company has been selected as the Construction Manager @ Risk by Dare County and is seeking to pre-qualify construction trade contractors to submit bids for the furnishing labor, materials, equipment, and tools for the Manteo Youth Center located in Manteo, NC. Please note: Only subcontractors who have been prequalified by Barnhill Contracting Company will be able to submit a Bid. PROJECT DESCRIPTION: The scope of the project encompasses approximately 4,300 sqft of new construction on a .72-acre site located at 101 Fernando St, Manteo, NC 27954. The project is a single-story structure with Cold Formed Steel framed bearing walls supporting a Standing Seam Metal Roof over Wood Trusses and Rafters housing administrative, assembly, kitchen, and support spaces.  Principal trade and specialty contractors are solicited for the following Bid Packages: BP0100 – General Trades / Temp Fencing; BP0105 – Final Cleaning; BP0205 – Demolition & Abatement; BP0390 – Turnkey Concrete; BP0400 – Turnkey Masonry; BP0500 – Structural Steel / Misc Steel / Stairs & Rails / Canopies/ Awning; BP0602 – Rough Carpentry / Wood Trusses / Composite Siding; BP0740 – Roofing; BP0790 – Caulking / Sealants /Waterproofing; BP0800 – Doors, Frames, & Hardware; BP0840 – Glass & Glazing / Storefront / Louvers / Shutters; BP0925 – Drywall/Framing; BP960 – Resilient Flooring, Carpet, Base, & Epoxy; BP0980 – Acoustical Ceilings; BP0990 – Painting And Wallcoverings; BP1005 – Specialties / Markerboards; BP1010 – Signage; BP1230 – Finish Carpentry and Casework; BP1250 – Window Treatments; BP2100 – Fire Protection; BP2200 – Plumbing; BP2300 – HVAC; BP2600 – Turnkey Electrical; BP3100 – Earthwork / Asphalt Paving / Site Utilities; BP3213 – Site Concrete; BP3231 – Fences & Gates; BP3290 – Landscaping. Packages may be added and/or deleted at the discretion of the Construction Manager. Historically underutilized business firms are encouraged to complete participation submittals.  Interested contractors should submit their completed prequalification submittals, by September 29, 2023, to Meredith Terrell at mterrell@barnhillcontracting.com or hardcopies can be mailed to Barnhill Contracting Company PO Box 31765 Raleigh, NC 27622 (4325 Pleasant Valley Road, NC 27612). PREQUALIFICATION FORMS CAN BE OBTAINED from our online plan room, by clicking on the “Dare County – Youth Center – CD Budget & Prequalification” project under the Public Jobs tab or by contacting Meredith Terrell by email or phone at 919-781-7210. Please note: Once Bid Documents become available, they will be posted to our plan room website shown above, however only subcontractors who have been prequalified by Barnhill Contracting Company will be able to submit a Bid. Target bid period: Mid-October to Mid-November.

NOTICE TO CONTRACTORS: BIDDER PRE-QUALIFICATION REQUEST:

Barnhill Contracting Company has been selected as the Construction Manager @ Risk by Dare County and is seeking to pre-qualify construction trade contractors to submit bids for the furnishing labor, materials, equipment, and tools for the EMS Station #8 located in Manns Harbor, NC. Please note: Only subcontractors who have been prequalified by Barnhill Contracting Company will be able to submit a Bid. PROJECT DESCRIPTION: The scope of the project encompasses approximately 6,200 sqft of new construction on a 3.4-acre site located at 6677 Highway 64/264, Manns Harbor, NC 27953. The project is a single-story structure with masonry bearing walls supporting a Standing Seam Metal Roof over Light Gauge Trusses housing administrative, living and support spaces along with 2 apparatus bays.  Principal trade and specialty contractors are solicited for the following Bid Packages: BP0100 – General Trades / Temp Fencing; BP0105 – Final Cleaning; BP0390 – Turnkey Concrete; BP0400 – Turnkey Masonry; BP0500 – Structural Steel / Misc Steel / Stairs & Rails / Canopies / Awning; BP0505 – Light Gauge Metal Trusses; BP0740 – Roofing; BP0750 – Composite Siding / Metal Wall Panels; BP0790 – Caulking / Sealants / Waterproofing; BP0800 – Doors, Frames, & Hardware; BP0836 – Overhead Doors; BP0840 – Glass & Glazing / Storefront / Louvers / Shutters; BP0925 – Drywall/Framing; BP960 – Resilient Flooring, Carpet, Base, & Epoxy; BP0980 – Acoustical Ceilings; BP0990 – Painting And Wallcoverings; BP1005 – Specialties / Markerboards; BP1010 – Signage; BP1050 – Lockers; BP1230 – Finish Carpentry and Casework; BP1250 – Window Treatments; BP2100 – Fire Protection; BP2200 – Plumbing; BP2300 – HVAC; BP2600 – Turnkey Electrical; BP3100 – Earthwork / Asphalt Paving / Site Utilities; BP3213 – Site Concrete; BP3231 – Fences & Gates; BP3290 – Landscaping. Packages may be added and/or deleted at the discretion of the Construction Manager. Historically underutilized business firms are encouraged to complete participation submittals.  Interested contractors should submit their completed prequalification submittals, by September 29, 2023 to Meredith Terrell at mterrell@barnhillcontracting.com or hardcopies can be mailed to Barnhill Contracting Company PO Box 31765 Raleigh, NC 27622 (4325 Pleasant Valley Road, NC 27612). PREQUALIFICATION FORMS CAN BE OBTAINED from our online plan room, by clicking on the “Dare County – EMS 8 – CD Budget & Prequalification” project under the Public Jobs tab or by contacting Meredith Terrell by email or phone at 919-781-7210. Please note: Once Bid Documents become available, they will be posted to our plan room website shown above, however only subcontractors who have been prequalified by Barnhill Contracting Company will be able to submit a Bid. Target bid period: Mid-October to Mid-November.

NOTICE TO CONTRACTORS: BIDDER PRE-QUALIFICATION REQUEST:

Barnhill Contracting Company has been selected as the Construction Manager @ Risk by Dare County and is seeking to pre-qualify construction trade contractors to submit bids for the furnishing labor, materials, equipment, and tools for the EMS Station #9 located in Kitty Hawk, NC. Please note: Only subcontractors who have been prequalified by Barnhill Contracting Company will be able to submit a Bid. PROJECT DESCRIPTION: The scope of the project encompasses approximately 7,600 sqft of new construction on a 1.13-acre site located at 4907 Putter Lane, Kitty Hawk, NC27949. The project is a single-story structure with masonry bearing walls supporting a Standing Seam Metal Roof over Light Gauge Trusses housing administrative, living and support spaces along with 3 apparatus bays.  Principal trade and specialty contractors are solicited for the following Bid Packages: BP0100 – General Trades / Temp Fencing; BP0105 – Final Cleaning; BP0390 – Turnkey Concrete; BP0400 – Turnkey Masonry; BP0500 – Structural Steel / Misc Steel / Stairs & Rails / Canopies / Awning; BP0505 – Light Gauge Metal Trusses; BP0740 – Roofing; BP0750 – Composite Siding / Metal Wall Panels; BP0790 – Caulking / Sealants / Waterproofing; BP0800 – Doors, Frames, & Hardware; BP0836 – Overhead Doors; BP0840 – Glass & Glazing / Storefront / Louvers / Shutters; BP0925 – Drywall/Framing; BP960 – Resilient Flooring, Carpet, Base, & Epoxy; BP0980 – Acoustical Ceilings; BP0990 – Painting And Wallcoverings; BP1005 – Specialties / Markerboards; BP1010 – Signage; BP1050 – Lockers; BP1230 – Finish Carpentry and Casework; BP1250 – Window Treatments; BP2100 – Fire Protection; BP2200 – Plumbing; BP2300 – HVAC; BP2600 – Turnkey Electrical; BP3100 – Earthwork / Asphalt Paving / Site Utilities; BP3213 – Site Concrete; BP3231 – Fences & Gates; BP3290 – Landscaping.  Packages may be added and/or deleted at the discretion of the Construction Manager. Historically underutilized business firms are encouraged to complete participation submittals.  Interested contractors should submit their completed prequalification submittals, by September 29, 2023, to Meredith Terrell at mterrell@barnhillcontracting.com or hardcopies can be mailed to Barnhill Contracting Company PO Box 31765 Raleigh, NC 27622 (4325 Pleasant Valley Road, NC 27612). PREQUALIFICATION FORMS CAN BE OBTAINED from our online plan room, by clicking on the “Dare County – EMS 9 – CD Budget & Prequalification” project under the Public Jobs tab or by contacting Meredith Terrell by email or phone at 919-781-7210. Please note: Once Bid Documents become available, they will be posted to our plan room website shown above, however only subcontractors who have been prequalified by Barnhill Contracting Company will be able to submit a Bid. Target bid period: Mid-October to Mid-November.

The post The Outer Banks Voice – Dare County to strive once more on Woda Cooper housing proposal appeared first on DAILY SAN FRANCISCO BAY NEWS.

SAN FRANCISCO — A man and woman have been charged in federal court with robbing two San Francisco banks on the same day, court filings show.

Ashley Crowder, 40, and Anthony Fardella, 39, were indicted by a federal grand jury in February on conspiracy and bank robbery charges. The indictment was unsealed this week. According to court documents, both Crowder and Fardella have been released from federal custody while charges are pending.

The indictment alleges that on November 19, 2022, Crowder, Fardella and a third person, identified only as “Person 1,” robbed the Bank of America at 1640 Van Ness Avenue in San Francisco by asking the teller a note that says ” :” This is no joke! Follow these instructions so no one gets hurt. Empty all the money in your two drawers. No ink bags, no marked bills. Put the money in the bag calmly Don’t tell anyone and don’t follow me or everyone is in danger (sic).”

The robbery netted them $1,100, authorities say. They then went to the East West Bank at 498 Clement Street and stole $1,500 in a similar bill, the indictment says.

The indictment alleges that Crowder and Fardella were arrested later that day after a police chase in the Tenderloin area. The indictment states that police forced her car to stop with spikes and then took her into custody.

Last November, the San Francisco Attorney’s Office filed criminal charges against Crowder and Fardella, alleging that they robbed both banks and escaped police.

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SAN FRANCISCO — A man and woman have been charged in federal court with robbing two San Francisco banks on the same day, court filings show.

Ashley Crowder, 40, and Anthony Fardella, 39, were indicted by a federal grand jury in February on conspiracy and bank robbery charges. The indictment was unsealed this week. According to court documents, both Crowder and Fardella have been released from federal custody while charges are pending.

The indictment alleges that on November 19, 2022, Crowder, Fardella and a third person, identified only as “Person 1,” robbed the Bank of America at 1640 Van Ness Avenue in San Francisco by asking the teller a note that says ” :” This is no joke! Follow these instructions so no one gets hurt. Empty all the money in your two drawers. No ink bags, no marked bills. Put the money in the bag calmly Don’t tell anyone and don’t follow me or everyone is in danger (sic).”

The robbery netted them $1,100, authorities say. They then went to the East West Bank at 498 Clement Street and stole $1,500 in a similar bill, the indictment says.

The indictment alleges that Crowder and Fardella were arrested later that day after a police chase in the Tenderloin area. The indictment states that police forced her car to stop with spikes and then took her into custody.

Last November, the San Francisco Attorney’s Office filed criminal charges against Crowder and Fardella, alleging that they robbed both banks and escaped police.

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The post Feds cost two with robbing two San Francisco banks throughout the identical day appeared first on DAILY SAN FRANCISCO BAY NEWS.

It was a disappointing rookie season for 49ers 2021 second-round draft pick Aaron Banks. The Notre Dame product was a healthy scratch for the first part of the season before eventually working his way into a special teams role. His improvement is one of the team’s biggest keys in 2022, and it sounds like he’s moving in the right direction.

49ers offensive line coach Chris Foerster told the Athletic that Banks is putting together a good offseason. It appears, at least at this early stage, that he’s the frontrunner for the starting left guard spot.

“That’s where our strength and conditioning people have done a phenomenal job of just remaking that 330 pounds,” Foerster told the Athletic. “And so yes, his conditioning, his strength, have improved. … He has the ability to maintain, to play faster, to play harder, because he’s in better shape.”

With left guard Laken Tomlinson’s exit in free agency, there’s a hole on the left side of the offensive line. Banks spent three years at Notre Dame where he played in 38 games across four years and started all of his final 31 contests at left guard.

There was some speculation after last year’s draft that he’d be the starting right guard as a rookie, but an injury in camp derailed him early and he was never able to catch up.

Foerster said Banks is working at his natural position this offseason, which may help catalyze his jump into the starting lineup.

Getting Banks to play at a high level would be a significant development for San Francisco since they don’t have any real answers along their offensive line. They need to figure out both starting guard spots and they made need to replace center Alex Mack.

If Banks steps in and plays at the level the 49ers believed he can reach when they took him No. 48 overall in 2021, they’ll shore up one side of their offensive line and maximize the level of competition for the starting guard spot on the other side.

2022 is all about first-time starting quarterback Trey Lance, but his success will tie directly to how well his offensive front plays, and Banks has a chance to make a massive impact there.

The post San Francisco 49ers OL Aaron Banks could possibly be key to offense in 2022 appeared first on DAILY SAN FRANCISCO BAY NEWS.

Nice day. The Federal Reserve, the Bank of England and the European Central Bank have embarked on different policy paths this week, underscoring how the central banks’ plans to phase out multi-billion dollar stimulus policies and aim for higher interest rates are developing at different speeds around the world with large economies that are with face an incomplete recovery while inflationary pressures mount. Meanwhile, the Bank of Mexico hiked rates again on Thursday, only this time it raised its overnight money target by half a percentage point to 5.5% after having raised it by quarter points at its previous four meetings. Latin American competitors Brazil and Chile have also hiked interest rates faster in response to rising inflation. In addition, the Japanese central bank has kept its monetary policy extremely loose earlier today and expressed minimal concern about inflation.

Now for today’s news and analysis.

Top news

Europe’s leading central banks on different courses in view of inflation

Europe’s leading central banks embarked on different policy paths the day after the Federal Reserve paved the way for rate hikes in 2022 due to the coronavirus.

The Bank of England was the first of the world’s major central banks to raise its key interest rate since the pandemic began, while the European Central Bank said it would phase out an emergency bond-buying program while stepping up other stimulus measures around Jan. to keep the eurozone recovery on track.

Bank of Mexico accelerates rate hikes

The Bank of Mexico accelerated the pace of rate hikes on Thursday after inflation hit more than 20-year highs, prompting the bank to raise its inflation forecast. The bank’s board of governors voted 4 to 1 to raise the overnight target to 5.5%.

The economic outlook for 2022 with SF Fed President Mary Daly

Mary Daly, President of the Federal Reserve Bank of San Francisco, answers your questions at 1 p.m. ET today about the US economic outlook and steps the Fed has taken to contain the economic impact of the Covid-19 pandemic and reduce inflation fight. Sign up here.

US economy

The number of unemployment claims rose last week but has remained low for almost decades

Initial jobless claims, a proxy for layoffs, rose from a revised 188,000 – the lowest in 52 years – by 18,000 in the week ended December 11, to 206,000 the week before, the Labor Department said. The number of new applications for unemployment benefits fell steadily over the course of the year.

White House boosts trucker recruitment campaign

The Biden government on Thursday unveiled a plan aimed at increasing the number of commercial truckers by making certification easier and faster for them in the coming months, as part of a broader push to tackle supply chain bottlenecks .

Inflation is near a 40-year high. This is what it looks like

The upward pressure on prices is expanding beyond goods and services directly affected by the Covid-19 pandemic. The price increases for fuel, cars, groceries, clothing, and medical supplies vary widely. Take a look at the snapshot of the journal.

Important developments around the world

Japan’s central bank avoids a worsening trend and points to a lack of inflation

The Bank of Japan kept its short-term rate target at minus 0.1% and said it would continue to lower the yield on 10-year Japanese government bonds to around zero, well below the US, where corresponding government bonds are yielding above 1.4%. .

Mexico says planned US tax breaks will boost migration

A proposal before the US Senate to give Americans who buy US-built electric vehicles tax credits threatens to harm Mexican industry and encourage illegal immigration to the US, Mexican Economy Secretary Tatiana Clouthier said.

Investors hunt for Evergrande bonds amid a default

Some asset managers bought bonds from China Evergrande Group when the developer defaulted and prices hit record lows.

Summary of the Financial Regulation

Biden Administration Investigates Companies That “Buy Now, Pay Later”

Just in time for Christmas: an initial regulatory investigation of its kind by the Consumer Financial Protection Bureau into “buy now, pay later” installment payments that are often offered to online shoppers.

HSBC has imposed $ 85 million on lax money laundering controls

HSBC Holdings PLC was fined £ 63.9 million, the equivalent of $ 85 million, for inadequate anti-money laundering controls the London bank used to monitor hundreds of millions of dollars in transactions.

US is under pressure to sanction Myanmar’s lucrative energy industry

As the Myanmar military escalates its war on its adversaries, the US and other countries face increasing pressure from lawmakers and human rights defenders to take action against an industry that is the country’s single largest source of foreign money.

UK fines GAM, fund manager who invested in Greensill loans

The UK’s Financial Conduct Authority has fined Swiss asset manager GAM Holding AG and one of its former Star bond fund managers for a conflict of interest to settle a longstanding case related to the company’s investments in Greensill Capital-generated loans.

Foresight

Friday (all times ET)

Time N / A: Bank of Japan issues policy statement

1 p.m .: Waller of the Fed delivers a speech on the economic outlook at the Forecasters Club of New York event

Tuesday

6:50 p.m .: Bank of Japan publishes minutes of meetings from October 27th to 28th

research

Think Tank report says the Fed’s new rate is still pretty numb

As restrictive as the Fed’s outlook may seem after the Fed’s Open Market Committee meeting this week, it’s historically not, says Joseph Gagnon, senior researcher at the Peterson Institute for International Economics. “The FOMC continues to forecast historically low interest rates,” he wrote in a report on Wednesday. With the median projection of the federal funds rate of 2.1% by the end of 2024, the Fed’s expected path is only where officials see inflation at the time, Gagnon wrote. He added that “that would mean a very low real or inflation-adjusted interest rate of 0% for a year in which the FOMC predicts continued solid growth and very low unemployment.” In other words, even with the interest rate hikes expected by the Fed, the central bank does not see that its monetary policy stance is holding back economic activity.

– Michael S. Derby

comment

The risk to the markets is not higher interest rates, but lower payroll targets

After months of worrying about central banks becoming restrictive in the markets, the markets decided they could handle higher interest rates, but the real danger is that inflation will drive officials’ recent ambitions for a tighter labor market reduced, writes Jon Sindreu. Just a day after the Federal Reserve signaled that it could hike rates three times over the next year, equity markets in both the UK and the euro zone saw new gains.

The US economy is cheering off-season

There could be signs that home builders and manufacturers struggling to meet demand due to supply chain issues and hiring difficulties weren’t seeing their typical slowdowns in November, writes Justin Lahart.

Basis points

US industrial production rose 0.5% month-on-month, seasonally adjusted, in November and slowed from an upwardly revised 1.7% increase in October that followed weather-related disruptions in September, the Federal Reserve said. (Dow Jones Newswires)

The Federal Reserve Bank of Philadelphia announced that its regional business activity measure fell from 39.0 in November to 15.4 this month. According to a survey by the Wall Street Journal, economists expected a value of 30.0. Readings above zero indicate an improvement in conditions. (DJN)

According to a survey by the Federal Reserve Bank of Kansas City, the growth of factory activity in the central US in December compared to the previous month held its pace. The composite index of the 10th manufacturing district survey was unchanged this month, signaling expansion. Economists polled by the Wall Street Journal expected an index of 25. (DJN)

U.S. private sector economic growth remained strong this month as service sector activity spiked on strong demand while manufacturing supply chain lags eased, data from IHS Markit’s survey of purchasing managers showed. The US composite output index fell from 57.2 in November to a three-month low of 56.9. Values ​​above 50 indicate growth, so the index points to a strong increase in business activity in the private sector, albeit at a slower pace than at the beginning of the year. (DJN)

U.S. new construction rose in November after two months of decline, according to the Department of Commerce, as home starts rose 11.8% month-over-month and 8.3% year-over-year to a seasonally adjusted annual rate of 1.68 million. (DJN)

Car registrations in the European Union declined in November and this year fell for the fifth month in a row, the Association of European Automobile Manufacturers announced on Friday. New car registrations fell by 20.5% month-on-month to 713,346 vehicles, the association, also known as ACEA, said. (DJN)

The German producer price index for industrial products rose in November by 19.2% compared to the previous year, announced the Federal Statistical Office Destatis on Friday. This is the highest increase over the previous year since November 1951, said Destatis. (DJN)

(FOLLOW MORE) Dow Jones Newswires

Dec 17, 2021 9:17 AM ET (2:17 PM GMT)

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Nice day. The Federal Reserve, the Bank of England and the European Central Bank have embarked on different policy paths this week, underscoring how the central banks’ plans to phase out multi-billion dollar stimulus policies and aim for higher interest rates are developing at different speeds around the world with large economies that are with face an incomplete recovery while inflationary pressures mount. Meanwhile, the Bank of Mexico hiked rates again on Thursday, only this time it raised its overnight money target by half a percentage point to 5.5% after having raised it by quarter points at its previous four meetings. Latin American competitors Brazil and Chile have also hiked interest rates faster in response to rising inflation. In addition, the Japanese central bank has kept its monetary policy extremely loose earlier today and expressed minimal concern about inflation.

Now for today’s news and analysis.

Top news

Europe’s leading central banks on different courses in view of inflation

Europe’s leading central banks embarked on different policy paths the day after the Federal Reserve paved the way for rate hikes in 2022 due to the coronavirus.

The Bank of England was the first of the world’s major central banks to raise its key interest rate since the pandemic began, while the European Central Bank said it would phase out an emergency bond-buying program while stepping up other stimulus measures around Jan. to keep the eurozone recovery on track.

Bank of Mexico accelerates rate hikes

The Bank of Mexico accelerated the pace of rate hikes on Thursday after inflation hit more than 20-year highs, prompting the bank to raise its inflation forecast. The bank’s board of governors voted 4 to 1 to raise the overnight target to 5.5%.

The economic outlook for 2022 with SF Fed President Mary Daly

Mary Daly, President of the Federal Reserve Bank of San Francisco, answers your questions at 1 p.m. ET today about the US economic outlook and steps the Fed has taken to contain the economic impact of the Covid-19 pandemic and reduce inflation fight. Sign up here.

US economy

The number of unemployment claims rose last week but has remained low for almost decades

Initial jobless claims, a proxy for layoffs, rose from a revised 188,000 – the lowest in 52 years – by 18,000 in the week ended December 11, to 206,000 the week before, the Labor Department said. The number of new applications for unemployment benefits fell steadily over the course of the year.

White House boosts trucker recruitment campaign

The Biden government on Thursday unveiled a plan aimed at increasing the number of commercial truckers by making certification easier and faster for them in the coming months, as part of a broader push to tackle supply chain bottlenecks .

Inflation is near a 40-year high. This is what it looks like

The upward pressure on prices is expanding beyond goods and services directly affected by the Covid-19 pandemic. The price increases for fuel, cars, groceries, clothing, and medical supplies vary widely. Take a look at the snapshot of the journal.

Important developments around the world

Japan’s central bank avoids a worsening trend and points to a lack of inflation

The Bank of Japan kept its short-term rate target at minus 0.1% and said it would continue to lower the yield on 10-year Japanese government bonds to around zero, well below the US, where corresponding government bonds are yielding above 1.4%. .

Mexico says planned US tax breaks will boost migration

A proposal before the US Senate to give Americans who buy US-built electric vehicles tax credits threatens to harm Mexican industry and encourage illegal immigration to the US, Mexican Economy Secretary Tatiana Clouthier said.

Investors hunt for Evergrande bonds amid a default

Some asset managers bought bonds from China Evergrande Group when the developer defaulted and prices hit record lows.

Summary of the Financial Regulation

Biden Administration Investigates Companies That “Buy Now, Pay Later”

Just in time for Christmas: an initial regulatory investigation of its kind by the Consumer Financial Protection Bureau into “buy now, pay later” installment payments that are often offered to online shoppers.

HSBC has imposed $ 85 million on lax money laundering controls

HSBC Holdings PLC was fined £ 63.9 million, the equivalent of $ 85 million, for inadequate anti-money laundering controls the London bank used to monitor hundreds of millions of dollars in transactions.

US is under pressure to sanction Myanmar’s lucrative energy industry

As the Myanmar military escalates its war on its adversaries, the US and other countries face increasing pressure from lawmakers and human rights defenders to take action against an industry that is the country’s single largest source of foreign money.

UK fines GAM, fund manager who invested in Greensill loans

The UK’s Financial Conduct Authority has fined Swiss asset manager GAM Holding AG and one of its former Star bond fund managers for a conflict of interest to settle a longstanding case related to the company’s investments in Greensill Capital-generated loans.

Foresight

Friday (all times ET)

Time N / A: Bank of Japan issues policy statement

1 p.m .: Waller of the Fed delivers a speech on the economic outlook at the Forecasters Club of New York event

Tuesday

6:50 p.m .: Bank of Japan publishes minutes of meetings from October 27th to 28th

research

Think Tank report says the Fed’s new rate is still pretty numb

As restrictive as the Fed’s outlook may seem after the Fed’s Open Market Committee meeting this week, it’s historically not, says Joseph Gagnon, senior researcher at the Peterson Institute for International Economics. “The FOMC continues to forecast historically low interest rates,” he wrote in a report on Wednesday. With the median projection of the federal funds rate of 2.1% by the end of 2024, the Fed’s expected path is only where officials see inflation at the time, Gagnon wrote. He added that “that would mean a very low real or inflation-adjusted interest rate of 0% for a year in which the FOMC predicts continued solid growth and very low unemployment.” In other words, even with the interest rate hikes expected by the Fed, the central bank does not see that its monetary policy stance is holding back economic activity.

– Michael S. Derby

comment

The risk to the markets is not higher interest rates, but lower payroll targets

After months of worrying about central banks becoming restrictive in the markets, the markets decided they could handle higher interest rates, but the real danger is that inflation will drive officials’ recent ambitions for a tighter labor market reduced, writes Jon Sindreu. Just a day after the Federal Reserve signaled that it could hike rates three times over the next year, equity markets in both the UK and the euro zone saw new gains.

The US economy is cheering off-season

There could be signs that home builders and manufacturers struggling to meet demand due to supply chain issues and hiring difficulties weren’t seeing their typical slowdowns in November, writes Justin Lahart.

Basis points

US industrial production rose 0.5% month-on-month, seasonally adjusted, in November and slowed from an upwardly revised 1.7% increase in October that followed weather-related disruptions in September, the Federal Reserve said. (Dow Jones Newswires)

The Federal Reserve Bank of Philadelphia announced that its regional business activity measure fell from 39.0 in November to 15.4 this month. According to a survey by the Wall Street Journal, economists expected a value of 30.0. Readings above zero indicate an improvement in conditions. (DJN)

According to a survey by the Federal Reserve Bank of Kansas City, the growth of factory activity in the central US in December compared to the previous month held its pace. The composite index of the 10th manufacturing district survey was unchanged this month, signaling expansion. Economists polled by the Wall Street Journal expected an index of 25. (DJN)

U.S. private sector economic growth remained strong this month as service sector activity spiked on strong demand while manufacturing supply chain lags eased, data from IHS Markit’s survey of purchasing managers showed. The US composite output index fell from 57.2 in November to a three-month low of 56.9. Values ​​above 50 indicate growth, so the index points to a strong increase in business activity in the private sector, albeit at a slower pace than at the beginning of the year. (DJN)

U.S. new construction rose in November after two months of decline, according to the Department of Commerce, as home starts rose 11.8% month-over-month and 8.3% year-over-year to a seasonally adjusted annual rate of 1.68 million. (DJN)

Car registrations in the European Union declined in November and this year fell for the fifth month in a row, the Association of European Automobile Manufacturers announced on Friday. New car registrations fell by 20.5% month-on-month to 713,346 vehicles, the association, also known as ACEA, said. (DJN)

The German producer price index for industrial products rose in November by 19.2% compared to the previous year, announced the Federal Statistical Office Destatis on Friday. This is the highest increase over the previous year since November 1951, said Destatis. (DJN)

(FOLLOW MORE) Dow Jones Newswires

12-17-21 0917 ET

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The day Mayor Breed announced that City Hall staff would be working remotely because of the coronavirus pandemic was the day Cody Jang, Head Community Engagement Manager at San Francisco-Marin Food Bank, knew his job would change.

Three thousand volunteers canceled their shifts in a single day. Even the volunteers they could sign up had to work in smaller groups. And tech companies that used to be a constant source for large groups of volunteers were nowhere to be found.

“Nobody wanted to be held liable for sending their employees on a voluntary basis,” Jang explained.

Before the pandemic, the San Francisco-Marin Food Bank planned volunteer shifts three to five months in advance. The nonprofit organization’s two main camps ran food wrap shifts seven days a week, with between 30 and 80 volunteers per shift. Every day there were between two and four shifts. They provided food to around 34,000 families a week.

Today, only seven to ten people are committed to each camp shift. And yet, says Jang, they have to look after 16,000 additional families due to the increased need, a total of over 50,000 families per week.

That increase the tracks with data from the US Census Bureau. The Food Scarcity Pulse Survey found that 6.4% of households in the San Francisco metropolitan area did not have enough to eat between September 29 and October 12, compared with 5.7% in December 2018. But with the increase in teleworking Many technology companies are t no longer voluntarily sending their workers to blackboards. To close the volunteer void, boards are revising their processes, putting their employees on the assembly line and begging for individual volunteers to add a little extra weight.

Volunteers pack delivery bags at home in the SF-Marin Food Bank. (Kevin N. Hume / The Examiner)

According to a study by the Bay Area Council Economic Institute, 51% of workplaces in San Francisco are “remote-enabled”. As previously reported in the Examiner, about 20% of SF-Tech vacancies were for remote work in September – more than any other sector in The City. Even companies that at some point will call San Francisco employees to return to the office won’t reopen immediately. Salesforce and Uber, for example, are waiting for a full reopening until January 2022, while Airbnb is postponing it until further notice in September 2022.

For the past few years, Tafel have relied on some of these companies to find volunteers. For example, Salesforce employees get seven paid days of voluntary time off each year and volunteered more than 20,000 hours at SF-Marin Food Bank between 2016 and 2018 alone.

Zendesk has a remarkable and well-documented relationship with the nonprofit tenderloin social service GLIDE, which supports them with financial donations and volunteer technical staff who package groceries, safe injection kits, or provide human resource development and IT services. Food banks interviewed by the auditor said Twitter, Airbnb, Doordash and Amazon are also actively recruiting volunteers ahead of the pandemic.

There are many reasons technology companies have volunteered so much, especially with food distribution. For one, posting large numbers of workers to fight hunger and homelessness has certainly helped counter the narrative that tech companies are responsible for inequality in the region. But many of The City’s tech companies are also located downtown, either in the Financial District or SOMA, near many food banks and nonprofits that specialize in providing meals to the area’s homeless.

The food banks have also made it easy for them to volunteer. Whole teams can work on the same assembly line in a warehouse at the San Francisco-Marin Food Bank, for example, and there are shifts every day. Lillian Mark, GLIDE Community Safety and Education Manager, says she works directly with companies to create a bespoke volunteer “experience” for their employees based on a team’s specific interests and skills. Julia Sills, Director of Volunteer Services at St. Anthony’s, similarly works with companies to find shifts that go well with any schedule.

In the meantime, the panels are restructuring their way of working. Meals that were previously served in large dining rooms at GLIDE, for example, are distributed to-go with significantly less staff. The other most common tactics are simplifying food preparation – ham sandwiches instead of chili, for example – and closing common areas that require more maintenance and cleaning.

The biggest shift, however, comes in employee responsibilities. Once administrators have provided coordinated services, they get their hands dirty and do the services themselves, often working overtime and foregoing long-term planning for more immediate needs. “We have IT staff making sandwiches and executive assistants handing out meals,” said Mark.

Foster Farms frozen turkeys donated for holiday meals sit on a table in the SF-Marin Food Bank. (Kevin N. Hume / The Examiner)

The need escalates this holiday season. SF Marin Food Bank, GLIDE and St. Anthony’s all have special vacation programs that they need extra hands on. The days after a major public holiday, such as Black Friday or December 26, as well as the months of January and February, are always understaffed, even in times without a pandemic. “We are very concerned about early 2022,” said Jang.

But while some in The City fear tech companies will ever return to the “meat room,” the Tablets are reluctant to make permanent changes. The main solution they long for is the return of more volunteers who are returning of their own accord.

“I don’t feel like we’re in damage control mode because I’m optimistic,” says Sills. “Regardless of what the future of work looks like, whether you work from home, hybrid or not, connecting with the community you live in is important and fulfilling and something these workers want to do.”

virwin@sfexaminer.com

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A young British woman named PL Travers, who wrote about the film “Snow White” in 1937, described Walt Disney as a shameless supplier of cheese ball crap as a film critic: “There is a deep cynicism,” she wrote, “at the root of especially its sentimentality . “

Travers would experience it in person: She is the author of the series “Mary Poppins” and the subject of the upcoming Disney film “Saving Mr. Banks” about the efforts of the studio – and Walts – to wrest the magical story from the gripping claws of the pesky maid who wrote it.

Or that’s the story Disney is selling, with the ultra-likable Tom Hanks in the roles of Walt and Emma Thompson, who play Travers, a woman the actress described in an interview as “so terrible and so irritating”. Another recent story in Variety called it “a pill no spoonful of sugar could sweeten”.

Can’t a resolute literary legend take a break?

Travers is one of the few writers to ever stand against the Disney juggernaut and demand a level of commitment and approval that most in their position have been denied. She did it at a time and in an industry where women were few and far between and had an uphill battle just to be heard. Above all, she invented the beloved character, a mysterious nanny who is blown into the life of the Banks family by the east wind, holding the iconic umbrella in the air. Without Travers’ wild imagination, there would be no Mary, no movie.

“I don’t think Disney had the slightest idea what to expect when she showed up [on the ‘Poppins’ set]Says Brian Sibley, a British writer who worked with Travers on an unrealized sequel to the film in the 1980s. “She was an immensely complex person. Amazingly independent and strong, very determined, very strong-willed. “

It turned out to be as strong-willed as Disney – a man who was used to getting his own way. “Disney took her to Hollywood and decided to get her to make this movie,” says Marc Eliot, writer of Walt Disney: Hollywood’s Dark Prince.

“But she wasn’t very charming. She was a tough woman – not quirky or cute. She didn’t like American films and she hated animation more than anything. “

Travers demanded that the film contain no cartoon elements (a battle she ultimately lost). She thought songs like “Supercalifragilisticexpialidocious” were stupid. And she resented the romantic relationship that had developed between Mary (Julie Andrews) and chimney sweep Bert (Dick Van Dyke).

The confident Travers, who was born Helen Lyndon Goff in 1899, had an anti-tide history that Disney almost certainly wasn’t aware of. She never married at a time when an unmarried woman was deeply stigmatized. She dated both men and women, ran with a host of British A-list poets, and had a deep and formative interest in mysticism, myths and fairy tales. She was an adventurer who grew up in the Australian outback; As an adult she changed her name, moved to London and worked as an actress, dancer, adult writer and journalist. She spent two summers on an Indian reservation studying culture.

She didn’t like to suffer from fools, and she was never happy with the cheerful and clean movie Disney ultimately made of her book.

Unlike the clean ending of “Saving Mr. Banks” – a happy ending, since this is also a Disney film – Travers was never convinced of the man, his studio staff or the film. She cried at the premiere of “Mary Poppins” in 1964, to which she was initially not even invited. In contrast to “Mr. Banks, ”it wasn’t tears of joy, but deep frustration. She spent the rest of her life slandering what she saw as the maudlin mess her Mary Poppins had become on the big screen.

Travers died in 1996 at the age of 96, irascible to the last. She once said she looked forward to hearing all the answers when she was old, but when asked about it at 94, she barked at a reporter, “Here I am in my chair and I don’t think I … I do will know all the answers. I am human! “

Now Disney is coming back to temper and romanticize the sharp-tongued, endlessly creative woman herself – as well as her shabby treatment of her opinions.

“Disney had no creative respect for this woman,” says Eliot. “He wanted a property, and when he got it, he completely ignored her submissions and any restrictions she’d agreed to. And that’s how the film came about.

“This revisionist story – that’s part of the Walt Disney myth.”

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