Ecuador is holding high level discussions with Britain over the fate of Julian Assange, who has been living in the Ecuadorian embassy in London since 2012 after being granted political asylum, according to comments made by President Lenin Moreno to Spain’s El Pais daily newspaper.
“The issue of Mr. Assange is being treated with the British government and I understand that we have already established contact with Mr. Assange’s lawyers so we can find a way out.“
Not true, says Assange’s Attorney Carlos Poveda in a
— #FreeAssange! (tweets by campaign)⌛ (@JulianAssange) July 29, 2018
“>Sunday LaJournada article
retweeted by the official WikiLeaks Twitter account.
The defense of Julian Assange is concerned about the contradictions of the government of Ecuador, which claims to be seeking a solution to the asylum of the founder of Wikileaks through dialogue, with all parties, but refuses to meet with their lawyers, said Carlos Poveda, one of the activist’s lawyers. –LaJournada (translated)
“We have followed very closely the statements of President Lenin Moreno both in the United Kingdom and Spain,” said Poveda. “And I must warn that even the legal team that presides (the former judge of the Spanish Supreme Court) Baltasar Garzón requested a hearing to meet in London or Madrid, but they told him that Moreno’s schedule was full during the whole tour.”
In other words – Moreno is talking out of both sides of his mouth while feigning a new found concern for Assange’s fate (after referring to the WikiLeaks founder as a “hacker”, “an inherited problem” and a “stone in the shoe”).
We know how (Moreno) addresses the issue , said Poveda, who said that the president’s statements leave us confused.
In relation to the recent declarations of the Ecuadorian agent chief executive, of which his government is in “permanent” communication with London and with the legal team of Assange, Poveda maintained that that does not happen.
According to Poveda, Assange’s legal team is still awaiting a response from two letters sent from Madrid weeks ago requesting that Ecuador “explain the situation.”
Assange has been holed up in the embassy since 2012. Though Sweden long ago dropped its request that Assange be extradicted, he is still struggling with legal issues in the UK: Earlier this year, a UK court declined to reverse his arrest warrant for violating his bail terms when he initially took refuge at the embassy. Wikileaks has released thousands of diplomatic cables belonging to the US, and US officials, including Attorney General Jeff Sessions, have said Assange’s arrest is a “priority.”
In March, Ecuador cut Assange off from the outside world – blocking his internet and phone communications over violating a promise not to interfere with other countries’ affairs.
Assange particularly drew the ire of Ecuador by angering the Spanish government with his support for separatist leaders in Spain’s Catalonia region who sought to secede last year. –France24
Moreno told El Pais that the “ideal” solution would be for Assange to endure some sort of UK penalty for violating his parole, before he is extradited to a country “where there is no danger.”
Two weeks ago, reports surfaced in the UK media that high level talks were happening between UK and Ecuadorian officials to try and remove Assange from the embassy.
Foreign Office Minister Sir Alan Duncan is said to be spearheading the diplomatic effort. Sources close to Assange said he himself was not aware of the talks – supporting his attorney’s claim that they’ve been kept in the dark, while Assange believes that America has been putting “significant pressure” on Ecuador, including threatening to block an IMF loan, if he continues to stay at the embassy.
Furthermore, as we pointed out weeks ago, the United States imported a record amount of crude from Ecuador (a massive unprecedented surge all of a sudden), which begs the question…was there a payoff?
Young adults are now more likely to live with their parents than in any other living arrangement, according to new analysis of demographic data published by Axios, reflecting trends of the last half decade. And it’s not just a college grad thing anymore as even 30-year-old millennials are now more likely to stay at home while still paying off school loan debt and earning the same or less income than boomers.
Axios concludes of what it is to be30 then and now that, “In the mid-to-late-20th century, the American economy and culture were ripe for 30-year-old men, who — more than European and Japanese — typically landed well-paid careers, bought homes, and supported large families. But since then, getting ahead has become much harder.“
So what forces continue to steer people into their parents’ basements?
from “Failure to Launch” (2006)
Naturally, Millennials probably took it for granted that they’d successfully imitate their parents and even surpass them in areas of establishing a financially secure family by their late 20’s or early 30’s, being debt-free while saving for retirement, and earning higher wages than their parents, but the numbers suggest this isn’t happening.
Though now comprising almost a quarter of the population and as the largest demographic currently in the workforce, their median salaries are lower or the same as the prior generation, yet as Axios finds “the financial burdens they carry are heavier, limiting how much their lifestyle can mirror that of their parents.”
* * *
Here’s what it is to be your parents’ thirty vs. being thirty today by the numbers:
Data, via Axios: College attendance, median income, and home ownership from U.S. Census Bureau; cost of tuition from CollegeBoard; median debt from “The Great American Debt Boom, 1948-2013” by Alina Bartscher, Moritz Kuhn, Moritz Schularick and Ulrike I. Steins; marriage figures from a Pew Research Center analysis of the 1960-2000 decennial censuses and 2010 and 2016 American Community Survey (IPUMS). Note: All dollars are inflation-adjusted to 2016. Chart: Harry Stevens/Axios
A break with prior American rites of passage, including marriage and child-bearing. According to some demographers, this break could slow economic growth.
Men are more likely to earn less. In 1975, only a quarter of 25 to 34-year-old men made less than $30K per year, but that number rose to 41% in 2016.
As a measure of upward mobility, 92% of 30-year-olds in 1970 earned more than their parents at that age, according to a 2016 study led by Raj Chetty, a Stanford economist (h/t Roger Lowenstein). But of those who were 30 in 2014, just half earned more.
Chetty attributed most of this erosion to slower GDP growth and a change in the distribution of GDP favoring higher earners: GDP would have to rise by 6% a year to get the same impact, he said, and wealth would have to be distributed much more evenly.
In other words, Chetty suggested, it has become much, much harder for young lower- and middle-income workers to earn as much of the nation’s growing wealth as they once did.
* * *
In 2015 Millennials set a 75-year record for highest percentage of young adults living at home with mom:
As Axios explains further, 30-year-olds today are:
Living with their parents: In 1975, when the oldest Boomers were 29, 57% of 18 to 34- year-olds lived with a spouse in their own household. Even as late as 1990, almost half lived with a partner. But in 2016, 31% were living in their parents’ home, making it the new, most common living arrangement for young adults, according to Census data.
Paying more for college: In 1975, college tuition cost $2,450 for public, four-year colleges (in 2017 dollars). In 2017, it was almost $10,000, according to the CollegeBoard.
In more debt: In 1989, less than 20% of families had student debt, compared with 41% in 2013, according to the Census. The amount owed almost tripled in that time.
Less likely to be homeowners: 57% of 30 to 34-year-olds were homeowners in 1982, compared with just 45% in 2017.
But many young Americans are still opting not to own, but rather rent, which is a factor…
In 2017, 57% of millennialswere never married. In 1985 — when boomers were around the same age — only a third had never been married, Pew Research’s Richard Fry told Axios. Even accounting for unmarried living partners does not make up the difference, he said.
Having fewer children: When Boomers were in their 20s, the fertility rate was 2.48, well beyond the replacement level of 2.1. Today, it is just 1.76.
When a recent survey asked why they were having fewer kids, most young adults said “child care is too expensive.”
Generally, Millennials are best represented in the labor force yet are still most likely to live with their parents.
Richard Jackson, president of the Global Aging Institute, told Axios“Millennials are more risk averse than earlier generations at the same age. People 50 or even 25 years ago didn’t wait to be ‘financially well established’ before starting a family. Now it’s considered irresponsible not to.”
We might consider this a bit of lighthearted weekend humor, but unfortunately it’s all too real and all too lame, especially considering significant funding and resources actually went into this. And given that it’s NATO, somebody’s tax dollars had to actually foot the bill. But even NBC’s write-up of the story comes close to making fun of NATO’s latest attempt to combat fake news in pointing out that“reaction… appears to muted”.
NATO a week ago launched its newly unveiled “weapon in the disinformation battleground” tocounter the big scary Russiansand all others bent on manipulating the news toward their own sinister ends, as NBC explains:
Researchers at the defense alliance have developed a Facebook game that they believe can help people to be more discerning when sharing news online.
Initial reaction to the game, which is called The News Hero, appears to be muted.By Friday morning, it had received just 50 likes and one share.
YouTube screengrab from the NATO-created online game “The News Hero”
The online game is designed to be played and shared on Facebook, and far from being some kind of action/spy or historical thriller (which might actually be somewhat interesting among the youth it aims to target), it places gamers in the position of being a news publisher in a professional newsroom.
Players have to decide whether the headlines that pass their virtual ‘desk’ are real or fake. The game’s creator’s say they’re seeking to educate the Western public on how to properly discern real news from fake news or worse, Russian state disinformation campaigns.
The News Herowas developed over a period of four months by a team of eight people at the NATO Strategic Communications Center of Excellence in Latvia, which bills itself as “focused on countering misinformation campaigns” (yes, the name of this NATO unit is real).
NBC’s report noted the developers were not forthcoming with just how much money was spent on the project.
As Stars and Stripes explains, “the user is responsible for putting together a newspaper free of the phony. With the help of trusty assistant Bronco, you decide what is real and what is fake.”
Or rather, you decide what NATO wants you to identify as fake, or real, or disinfo, or untrustworthy as a source.
The NATO-created “News Hero” Facebook game launched a week ago.
Though the online game launched last Monday— a full week ago— it now has… wait for it… a whopping 3 shares and 123 ‘likes’as of late in the day Sunday.
So it appears people aren’t even so much as making the effort to share it out of mockery, much less actually playing and promoting the game.
To get your company noticed and gain an audience, you must publish accurate news. Pay attention to the hints provided in the Fact Checker screen and verify the incoming stories. With each level becoming increasingly difficult you can hire new assistants and obtain things to customize your office. This will boost performance of your employees and help you earn more. The game is divided into three levels, each informing the player on how to distinguish between the fact and the fiction. Are you up for the challenge? Invite your friends and climb the leaderboard!
And Stars and Stripes explains some of the ‘fake vs. true’ news scenarios presented in the game as follows:
Is Justin Timberlake really an anti-vaccination activist? Did a lady in Detroit really train a squirrel to attack her boyfriend?
In The News Hero, you have to decide — though a fact-checker does most of the thinking for you.
If you’re right, you gain virtual currency and a larger audience as reader trust grows for your news organization. If only it were so easy in the perilous real news world, where profits are elusive and clickbait an ever-growing lure.
One of the two reviews on the game’s Facebook page sarcastically quips: OK. So this is the ‘push back’. An ‘A’ for effort!
It’s interesting to recall that ahead of and during the NATO summit in Brussels earlier this month President Donald Trump made headlines for berating other NATO member states for not living up to a prior 2014 pledge for member states to reach two percent spending of GDP on defense by 2024.
However, we doubt that the president had such further projects as The News Hero in mind when he called for more NATO defense spending. The online game is clearly a complete and utter flop.
Following a disappointing earnings announcement that wiped out about $120 billion of shareholder wealth, Facebook, its CEO and CFO, are being sued by a shareholder potentially opening the floodgates for sore-losing stock market gamblers the world over.
“As a result of Defendants’ wrongful acts and omissions, and the precipitous decline in the market value of the Company’s common shares, Plaintiff and other Class members have suffered significant losses and damages“
Who could have seen that coming?
The complaint filed by shareholder James Kacouris in Manhattan federal court accused Facebook, Zuckerberg and Chief Financial Officer David Wehner of making misleading statements about or failing to disclose slowing revenue growth, falling operating margins, and declines in active users.
Kacouris said the marketplace was “shocked” when “the truth” began to emerge on Wednesday from the Menlo Park, California-based company. He said the 19 percent plunge in Facebook shares the next day stemmed from federal securities law violations by the defendants.
“The Individual Defendants possessed the power and authority to control the contents of Facebook’s SEC filings, press releases, and other market communications. The Individual Defendants were provided with copies of the Company’s SEC filings and press releases alleged herein to be misleading prior to or shortly after their issuance and had the ability and opportunity to prevent their issuance or to cause them to be corrected.
Because of their positions with the Company, and their access to material information available to them but not to the public, the Individual Defendants knew that the adverse facts specified herein had not been disclosed to and were being concealed from the public, and that the positive representations being made were then materially false and misleading. The Individual Defendants are liable for the false statements and omissions pleaded herein.”
Presumably Mr Kacouris would have preferred if Zuck had leaked the material non-public information to him first so he could have unwound his holdings in Facebook shares and avoided the losses from reality suddenly biting on a stock that has grown to the proverbial skies.
As Reuters notes, shareholders often sue companies in the United States after unexpected stock price declines, especially if the loss of wealth is large. The lawsuit seeks class-action status and unspecified damages. A Facebook spokeswoman declined to comment.
The House and Senate versions of the draft National Defense Authorization Act (NDAA) for fiscal year 2019 were unveiled by Congress on July 23. Both include a provision to temporarily bar the transfers of F-35 joint strike fighters (JSF) to Turkey.
According to the final 2019 defense bill, the Defense Department would be required to submit a report to lawmakers within 90 days about the relationship with Ankara, all its foreign weapons deals, and Turkey’s move to purchase the S-400 air-defense system from Russia before any more sales could go through. Until then the US would sit on any weapons transfers to Turkey. Ankara’s decision to buy the Russian S-400 air-defense system, the “F-35 killer,” has greatly aggravated bilateral ties between the US and Turkey, a relationship that was already clouded by many other issues.
The House is expected to vote on the legislation this month, with the Senate taking it up in early August. Defense Secretary Jim Mattis had warned Congress against punishing Turkey by cutting off transfers of F-35s in retaliation for its plans to buy the Russian anti-aircraft system, but his opinion was ignored. The State Department has been putting pressure on Ankara to try to make it reconsider the S-400 deal, in favor of purchasing the less capable, US-made Patriot system. US Assistant Secretary of State for European and Eurasian Affairs Wess Mitchell told the Senate “We’ve been very clear that across the board, an acquisition of S-400 will inevitably affect the prospects for Turkish military-industrial cooperation with the United States, including F-35.” Turkish officials view the US demand as blackmail.
Turkey is one of twelve partner nations in the F-35 program, nine of which have received the fighters through foreign military sales. Ankara has planned to purchase the 100 F-35 aircraft it technically already owns by investing $1.25 billion into the project. US legislators fear that using the F-35 and the S-400 together could compromise the F-35 and allow Russia to gain access to the sensitive technology. As a result, the true owner has been denied access to his property by both houses of US Congress.
The bill includes a compromise waiver under the Countering America’s Adversaries Through Sanctions Act (CAATSA) for the countries purchasing Russian military equipment, as long as they are taking steps to wean themselves from it.
The deal with Turkey is a part of a broader picture. The Philippines, also a long-time ally of Washington that has long relied on the United States as its main source of military hardware, is at risk of falling under US sanctions if it proceeds with its purchase of grenade launchers from Rosoboronexport, a blacklisted Russian firm. India has been threatened with sanctions should it decide to buy the Russian S-400.
The US State Department’s Office of Cooperative Threat Reduction has announced a tender for the monitoring of open-source information about arms deals involving the Russian Federation and the CIS countries. The information will be used for shaping the sanctions policy.
This policy goes beyond weapons deals to encompass economic issues as well. One can pay off. Take Germany, for instance. It has been threatened by sanctions in the event that the Nord Stream 2 gas project goes through. The English version of the German newspaper Handelsblatt reported that plans are afoot for a new LNG terminal in Brunsbüttel, a town in the northern state of Schleswig-Holstein. Once the costly infrastructure to cool and liquefy LNG is in place, the German government can demonstrate that the US is wrong to accuse it of being almost fully dependent on Russian gas. There are plans to invest an estimated €450 million ($530 million). Once built, the terminal cannot sit idle. The shipments of American LNG will be guaranteed.
But indeed there is no such thing as a free lunch. If Berlin wants to get cheap Russia gas, it will also have to spend some time and effort on building the infrastructure to receive Moscow’s LNG, and at that point, paying a lot more for American sea-transported LNG will hike the country’s overall energy expenditures
Perhaps Turkey could come to some kind of compromise with the Americans on the S-400, if it buys the Patriot as well. Maybe India will find a way to evade sanctions, if it agrees to the US offer of THAAD..
On July 24, US Senators Lindsey Graham (R-S.C.) and Bob Menendez (D-N.J.), announced that they are working on comprehensive legislation, which officially is aimed at ratcheting up the sanctions pressure on Russia. The text of the proposed legislation does not say so, but the true goal is to lean on other nations to buy US-made goods or else. Forget about the international rules stipulated by the UN Charter and WTO documents — “arms-twisting” has become an element of US foreign policy.
Nobody likes to be ordered around and blackmailed. In the long run, this policy will encourage other countries to reconcile their differences and unify, in an effort to push back against the US. Today Russia China, the EU, and many other actors face a common problem — the “do as I tell you” approach used by the US to tackle international problems, whatever they are. Those who had doubts about the merits of a multipolar world order are beginning to see things in a different light. Any state structure needs checks and balances to maintain an equilibrium, and so does the world. The BRICS summit that kicked off in Johannesburg, South Africa on July 25 symbolizes some global changes, in which poles of power outside of the US are emerging to reshape the political world map.
Submitted by Eric Peters, CIO Of New River Asset Management, as excerpted from his latest Weekend Notes
The US and EU account for over 50% of global GDP and have the world’s largest bilateral trade relationship, exchanging $1.1trln of goods and services annually; there’s no more integrated economic relationship on earth. One-third of world trade involves the US and EU – the US is humanity’s #1 customer, accounting for 18% of all imports, the EU is #2 at 15%.
Total US investment in the EU is 3x higher than its investment in all of Asia. EU investment in the US is 8x higher than its investment in India and China combined. The US and EU have 880mm people (12% of total population), $180trln of wealth (65% of global wealth) and own nearly all of humanity’s intellectual property.
To be sure, we have our differences, but heaven help this planet’s divided nations if we set those aside and seek material advantage.
* * *
“Mr. President, ladies and gentlemen, when I was invited by the President to the White House, I had one intention: I had the intention to make a deal today,” announced Jean-Claude Juncker, camera’s clicking, a media whir, history in the making. “And we made a deal today,” continued the President of the European Commission, as a shockwave circled the planet.
You see, throughout Europe’s timeless saga, never had a single politician cut a real deal on behalf of the entire continent, though not through any lack of effort. Many fought to attain the power of a united Europe – the Romans, Charlemagne, the short Frenchman with an ulcer, Austria’s most famous Adolph. Juncker’s unlike them all. He’s a creature of Europe’s modern union, a concept born of utter exhaustion, profound weakness.
After a few thousand-year fight with itself, the continent abandoned ambition, and became a tourist attraction for wealthy Americans and Chinese, who swarm its antique cities, admiring their ancient achievements, aspirations.
“So we had a big day. Very big. We met right here at the White House to launch a new phase in the relationship between the United States and the European Union — a phase of close friendship; of strong trade relations in which both of us will win; of working better together for global security and prosperity; and of fighting jointly against terrorism,” said Trump, triumphant.
“The European Union is going to do better, stronger, bigger. We will therefore work closely together with like-minded partners to reform the WTO and to address unfair trading practices, including intellectual property theft, forced technology transfer, industrial subsidies, distortions created by state-owned enterprises, and overcapacity,” continued our President, describing China, America’s only rival, the one remaining world power with any true ambition.
And so now the real economic war begins, with America and Europe allied.
In the aftermath of the busiest week of Q2 earnings season, just as traders prepare to depart for their various vacation destinations, a whirlwind of economic and financial events – or as Bloomberg calls it, a “storm of news“, is about to be unleashed on the globe, including closely watched central bank announcements from the BOJ, the Fed and BOE, the Treasury will unveil its latest bond sale details which are expected to increase, while the US jobs report on Friday in conjunction with inflation data scattered over the week for the US and Europe will keep traders on their toes. In addition, there are also 145 S&P 500 companies due to report, while earnings in Europe will also ramp up.
We start with the Bank of Japan, where unlike recent snoozers, Tuesday’s announcement will warrant greater attention following recent speculation in the media about whether we’ll see a tweak in the yield curve targets. Despite rumors it could soon unveil a plan to eventually adjust its stimulus by revising the 0% target fof 10Y JGBs, all 44 economists surveyed by Bloomberg predict the Bank of Japan will maintain the current setting on interest rates, while Governor Kuroda is set to unveil fresh inflation forecasts, which the press has leaked will be in a downward direction. An increase in the JGB yield target appears unlikely at a time when it is expected to revise downward its inflation forecast. According to Deutsche Bank, the BoJ will declare at the end of its statement that, based on its analysis in its quarterly Outlook Report, it will maintain its easing policy for an extended period “but will conduct financial market operations and asset purchasing operations to address the mounting cumulative side effects.” One likely adjustment is that the BOJ will overhaul its ETF purchasing operations (by shifting from Nikkei 225-linked ETF to Topix-linked ETF, leading to potential weakness for the Nikkei).
The Fed will likewise not announce any change in policy given that this is not a meeting that includes a post-meeting conference or a fresh summary of economic projections. However in light of the recent escalation in trade war, it’ll be interesting to see the Fed’s updated views. Recent comments from President Trump about Fed policy shouldn’t however have any impact on the Fed’s approach to monetary policy.
Moving on to the BOE, for the third central bank next week, the consensus expects a 25bp hike on Thursday, something that the market is currently assigning a 90% chance of happening. While the market has priced around 80% odds of a rate hike, many will be looking for signs that it won’t be a one-and-done as Brexit concerns weigh on the pound. There will be close attention on the vote count too. Should the BOE hike, this would mark the first time since 2009 that the bank rate would be above 0.5%. The latest BoE economic projections will also be released including new forecasts for growth and inflation. Governor Carney will offer an updated view on the neutral rate.
In terms of the data due out next week, Friday’s employment report in the US will be the main focus. Consensus expects that 193k jobs were created in July, following the 213k print back in June. The unemployment rate is expected to fall one-tenth to 3.9% which would put it a tenth above the post-financial crisis low, while average hourly earnings are expected to come in at +0.3% mom which should keep the annual rate at +2.7%. Commenting on the market reaction, Bloomberg notes that “the jobs report will be keenly watched as always, but while the last one weighed on the dollar, it’s worth noting that Treasury market reaction in recent months has tended to be relatively fleeting.” And with the unemployment rate no longer a source of signal, and at record lows, focus will remain on the increase (or decrease) in the growth rate of average hourly earnings and what that might say about inflation more broadly.
There is also a fresh batch of inflation data from around the globe, where many expect a continuation of the recent tapering in rising prices. In the US we’ll get the June PCE report on Tuesday where the market expects a modest +0.1% mom core and deflator reading, the former enough to keep the annual rate at +2.0% yoy. In Europe we’ll also get flash July CPI readings for the Eurozone on Tuesday (+1.0% yoy core reading expected, up from +0.9% in June) as well as regional readings for Germany and Spain on Monday, and France and Italy on Tuesday.
Other data to watch out for in the US next week include the July consumer confidence print on Tuesday, July ISM manufacturing report on Wednesday and July PMIs on Friday. The remaining July PMIs in Europe are also out on Friday as well as for Asia on Tuesday (China) and Friday (China and Japan). Away from that, in Europe we get the advance Q2 GDP reading for the Euro area on Tuesday, with expectations for a +0.5% qoq reading.
The trade war will get another push next week when the end of the review period for potential tariffs on $16 billion of Chinese goods arrives on Tuesday.
In the last busy week of Q2 earnings season for the US, we will see 145 S&P 500 companies report. The highlights are Caterpillar on Monday – which is always a good barometer for global growth – Apple, Procter & Gamble and Pfizer on Tuesday, Metlife on Wednesday, Dupont on Thursday, and Berkshire Hathaway on Friday. In Europe we’ll also get releases from Volkswagen, Siemens, BP, Barclays and Credit Suisse.
Finally as Deutsche Bank’s Craig Nicol points out, other scheduled events next week which could warrant keeping an eye on include President Trump hosting Italian PM Conte on Monday at the White House, UK Foreign Secretary Hunt co-chairing the China-UK Strategic Dialogue with China counterpart Wang Yi, also on Monday, Russian Foreign Minister Lavrov meeting Japan Foreign Minister Kono on Tuesday, and the US Treasury releasing its latest borrowing plans on Wednesday.
Summary of key global economic indicators and events this week
Source: Goldman Sachs
* * *
A breakdown of key daily events, via Deutshe Bank:
Monday: It’s a quiet start to the week on Monday. Overnight we get June retail sales in Japan. In Europe, we’ll get the preliminary July CPI print for Spain followed by June money and credit aggregates data in the UK and July confidence indicators for the Euro area. In the afternoon we’ll then get the July preliminary CPI report for Germany, while in the US the data includes June pending home sales data and the July Dallas Fed manufacturing activity print. Away from that, President Donald Trump will host Italian Prime Minister Giuseppe Conte at the White House, while earnings highlights include Caterpillar.
Tuesday: All eyes on Tuesday will be on the BoJ monetary policy meeting. Datawise, we get the July GfK consumer confidence print for the UK overnight along with preliminary June industrial production for Japan and July PMIs China. In Europe, we’ll get preliminary July CPI prints for France, Italy and the Euro area along with the advance Q2 GDP release for the Euro area. In the US, June PCE and the Q2 ECI data should be the main focus, while the July Chicago PMI and July consumer confidence data are also slated for release. Apple earnings will also be a big focus, while Procter & Gamble, Pfizer, BP and Credit Suisse numbers are also due.
Wednesday: The big highlight on Wednesday is the Fed monetary policy meeting outcome at 19:00 BST. Prior to this, data releases include the final July manufacturing PMI for Japan and July Caixin manufacturing PMI for China. In Europe, we’ll also get the remaining July manufacturing PMIs while in the US the July ADP employment change reading, final July manufacturing PMI, June construction spending, July ISM manufacturing and July total vehicle sales data are all due. Away from that, Tesla and Metlife will be reporting Q2 earnings. It’s worth also noting that the US Treasury will unveil its latest borrowing plans.
Thursday: The main focus on Thursday will likely be the BoE’s MPC meeting outcome at 12:00 BST. It’s a quiet day for data in Europe with June PPI for the Euro area the only release of note. In the US, the latest weekly initial jobless claims print is due along with June factory orders data and the final June durable and capital goods orders revisions. Away from the data, the BoJ’s Amamiya will speak overnight. Earnings wise, Barclays, Siemens and Dupont will report.
Friday: We end the week on Friday with the July employment report in the US. Away from that, overnight, we get the BoJ’s June monetary policy meeting minutes along with July services and composite PMIs for Japan and July Caixin services and composite PMIs for China. In Europe the final services and composite PMIs are also due along with June retail sales for the Euro area. In the US, the other data includes the final July services and composite PMI prints along with July ISM non-manufacturing composite. Berkshire Hathaway will report its Q2 earnings.
* * *
Finally, focusing just on the US, Goldman writes that the key economic releases this week include core PCE on Tuesday, ISM manufacturing on Wednesday, and payrolls on Friday. The statement following the FOMC meeting will be released on Wednesday.
Monday, July 30
10:00 AM Pending home sales, June (GS +0.5%, consensus +0.2%, last -0.5%): We estimate pending home sales rebounded 0.5%, following a 0.5% decline in the May report. We have found pending home sales to be a useful leading indicator of existing home sales with a one- to two-month lag.
10:30 AM Dallas Fed manufacturing index, July (consensus +31.0, last +36.5)
Tuesday, July 31
8:30 AM Personal income, June (GS +0.3%, consensus +0.4%, last +0.4%); Personal spending, June (GS +0.5%, consensus +0.5%, last +0.2%); PCE price index, June (GS +0.07%, consensus +0.1%, last +0.21); Core PCE price index, June (GS +0.07%, consensus +0.1%, last +0.21%); PCE price index (yoy), June (GS +2.28%, consensus +2.3%, last +2.25%); Core PCE price index (yoy), June (GS +1.84%, consensus +2.0%, last +1.96%): Based on details in the PPI, CPI and import price reports, we forecast that the core PCE price index rose +0.07% month-over-month in June, or 1.84% from a year ago. Additionally, we expect that the headline PCE price index also increased 0.07% in June, or 2.28% from a year earlier. We expect a 0.3% increase in June personal income and a 0.5% gain in personal spending.
Employment Cost Index, Q2 (GS +0.6% vs. consensus +0.7%, prior +0.8%); We estimate that the employment cost index (ECI) rose 0.6% in Q2 (qoq sa). While we remain constructive on wage growth, we note the possibility that larger-than-normal annual wage increases may have contributed to the cycle-high ECI growth in Q1 (+0.84% qoq ar). Accordingly, we see scope for a modest deceleration in the sequential pace (that nonetheless boosts the year-over-year rate by a tenth to 2.7%). Our wage tracker—which distills signals from several wage measures—edged up to 2.7% in Q2 from 2.6% in Q1 and 2.3% in Q4.
09:00 AM S&P/Case-Shiller 20-city home price index, May (GS +0.2, consensus +0.2%, last +0.2%): We expect the S&P/Case-Shiller 20-city home price index increased 0.2% in May, following a 0.2% increase in April. Our forecast of a modest increase reflects a slowdown of the strong trend the index has been following (now +0.5%, 3mma) relative to the more subdued pace of other home price indices.
09:45 AM Chicago PMI, July (GS 63.0, consensus 61.8, last 64.1): Regional manufacturing surveys were mixed in July, and we estimate that the Chicago PMI moved down by 1.1pt to 63.0. Uncertainty about trade policy could potentially weigh on business sentiment in this report.
10:00 AM Conference Board consumer confidence, July (GS 126.0, consensus 126.5, last 126.4): We estimate that the Conference Board consumer confidence index decreased 0.4pt to 126.0 in July, following a decline of 2.4pt in the previous month. While the index remains close to post-crisis highs, our forecast reflects a slight decrease in other consumer sentiment measures earlier in the month.
Wednesday, August 1
08:15 AM ADP employment report, July (GS +200k, consensus +185k, last +177k); Based on our understanding of how ADP filters its own proprietary data with other publicly available information, we expect a 200k gain in ADP payroll employment in July, partly driven by an improvement in initial jobless claims.
09:45 AM Markit Flash US Manufacturing PMI, July final (consensus 55.5, last 55.5)
10:00 AM Construction spending, June (GS +0.4%, consensus +0.3%, last +0.4%): We estimate construction spending increased 0.4% in June, following an increase in May that reflected relatively firm private single family and multifamily construction but weaker commercial construction.
10:00 AM ISM manufacturing, July (GS 59.7, consensus 59.3, last 60.2): Our manufacturing survey tracker – which is scaled to the ISM index — declined from its all-time high by 0.4pt to 60.4 following slightly softer, but still strong, manufacturing surveys in July. Industrial firm commentary in regard to sales trends has remained firm, but we do not expect the same boost that last month saw from a sharp increase in the supplier deliveries component. All taken together, we expect the ISM manufacturing index to decline by 0.5pt to 59.7.
02:00 PM FOMC statement, July 31 – August 1 meeting: As discussed in our FOMC preview, we do not expect any policy changes next week and expect only limited changes to the post-meeting statement. We expect an upbeat statement consistent with a September hike, retaining most of the positive characterizations from the June meeting, given solid US growth data and stable financial conditions.
4:00 PM Total vehicle sales, July (GS 17.2mn, consensus 17.0mn, last 17.4mn)
Thursday, August 2
08:30 AM Initial jobless claims, week ended July 28 (GS 220k, consensus 220k, last 217k); Continuing jobless claims, week ended July 21 (last 1,745k): We estimate initial jobless claims increased by 3k to 220k in the week ended July 28, following a 9k increase in the previous week. The trend in initial jobless claims appears to be declining, and the auto plant shutdowns have led to major spikes in layoffs over the last few weeks.
10:00 AM Factory Orders, June (GS +0.5%, consensus +0.7%, last +0.4%); Durable goods orders, June final (last +1.0%); Durable goods orders ex-transportation, June final (last +0.4%); Core capital goods orders, June final (last +0.6%); Core capital goods shipments, March final (last +1.0%): We estimate factory orders rose 0.5% in June following a 0.4% increase in May. Headline durable goods orders were strong in the June advance report, largely driven by an increase in non-defense aircraft orders. Core measures were solid, with increases in both core capital goods orders and core capital goods shipments.
Friday, August 3
8:30 AM Nonfarm payroll employment, July (GS +205k, consensus +190k, last +213k); Private payroll employment, July (GS +200k, consensus +185k, last +202k); Average hourly earnings (mom), July (GS +0.2%, consensus +0.2%, last +0.2%); Average hourly earnings (yoy), July (GS +2.6%, consensus +2.7%, last +2.7%); Unemployment rate, July (GS 3.9%, consensus 3.9%, last 4.0%): We estimate nonfarm payrolls increased 205k in July. Our forecast reflects new lows in initial jobless claims and continued strength in service-sector employment surveys. We expect the unemployment rate to partially reverse its June increase, falling a tenth to 3.9%. While continuing claims rebounded during the payroll month, the June participation rate was at the high end of its multi-year range, and we expect it to drift lower in coming quarters. Finally, we expect average hourly earnings to increase 0.2% month over month and 2.6% year over year, reflecting unfavorable calendar effects.
8:30 AM Trade balance, June (GS -$46.7bn, consensus -$46.1bn, last -$43.1bn): We estimate the trade deficit widened by $3.6bn in June, reflecting a similar widening in the goods trade deficit in the Advance Economic Indicators report last week.
09:45 AM Markit flash US services PMI, July final (consensus 56.2, last 56.2)
10:00 AM ISM non-manufacturing, July (GS 58.7, consensus 58.6, last 59.1): We expect the ISM non-manufacturing index to decline by 0.4pt to 58.7 in July. On net, our nonmanufacturing survey tracker moved down 0.5pt to 58.1, reflecting a general softening of service-sector surveys.
It was a tough week for FANG stocks with even the all-conquering Amazon.com unable to hold on to its post-earnings gains.
However, as Statista’s Felix Richter notes, after a remarkable hiring spree and the acquisition of Whole Foods saw Amazon add more than 200,000 employees in 2017, the first six months of 2018 indicate that the company’s workforce will be growing at a less spectacular rate this year.
In the first six months of 2018, the e-commerce giant added 9,700 employees to its global workforce, which is less than the average monthly growth of 2017.
Amazon CFO Brian Olsavsky said on a call with reporters Thursday that Amazon has slowed its external hiring in favor of filling some positions with internal transfers.
“What we are doing is probably hiring and transferring more people internally in the last six months, so the net hiring hasn’t been driven by external hiring, it’s been more by internal transfers and re-leveling in some areas and seeing where we maybe need to add back,” Olsavsky said.
On a separate call with analysts, Olsavsky said he doesn’t necessarily see this hiring practice as a long-term trend but it “certainly creates a lot of operating efficiencies.”
Amazon is only the second U.S company to employ more than half a million people, but it will have a hard time grabbing the number 1 spot anytime soon: Walmart currently employs 2.3 million people around the world.
COMMENT: From Europe, we are looking at your CNN and it really has become just propaganda and fake news. I was not a fan of Trump, but I have to say, he has done a great job probably better than any world leader. He has revised trade and has turned North Korea while your unemployment is now below 4% at 1960s level and you have a GDP growth of 4% while we have unemployment still in the 60% level among the youth and economic growth is at best 2.4%. It is hard to see why CNN turns everything negative.
HD
REPLY:
It is really becoming blatant.
This is one joke image going around, but it clearly demonstrates the point.
America’s GDP growth is 4.1%, which is about twice that of Europe.
Trump’s hardline threats of tariffs have yielded the first real new fair trade deal with the European Union.
North Korea is actually returning the remains of our fallen American soldiers which have made a huge difference to many families.
The immigration issue where families were being separated was portrayed as if it was something brand new under Trump. CNN never bothered to report this was a policy that predated Trump and that Obama deported more people than any other president in history. They intentionally ignored the immigration issue under Obama and only used it against Trump demonstrating how corrupt CNN has become acting as only a political propaganda network.
The damage CNN is doing to the country and the world is beyond description.
My greatest concern is they are fueling a Civil War and what comes AFTER Trump? The people will NOT be satisfied with a career politician any longer.
We are witnessing the Trump Revolution around the world and even within the Democrats.
Trump should stop the verbal assault on the press and reinstate the Fairness Doctrine and FORCE the press to present both sides and need this reign of propaganda.
However, the owner of CNN, Time Warner, the Chairman and CEO Jeff Bewkes came out and stated PUBLICLY that Trump does not pose a grave threat to free speech, but rather it was the Democrats.
Speaking at Business Insider’s Ignitiion, Bewkes made it very clear that the Democratic Party’s commitment to campaign finance reform was a threat to free speech. He pointed out that Hillary Clinton said she would push for a constitutional amendment to overturn Citizens United, the Supreme Court decision that lifted restrictions on political spending by corporations and interest groups. She wanted to reduce free speech that was being funded against the Democrats.
House Intel Committee Chair Devin Nunes said on Sunday that the American public will be “shocked” when the redacted portions of Carter Page’s FISA warrant application are revealed, reports the Daily Caller.
“We are quite confident that once the American people see these 20 pages, at least for those that will get real reporting on this issue, they will be shocked by what’s in that FISA application,” Nunes told Fox News’ Maria Bartiromo – implying that the public may one day see an unredated (or less redacted) copy.
After being compelled by a Freedom of Information Act lawsuit, the DOJ released a heavily redacted portion of the FBI’s FISA warrant application and several renewals for Carter Page, of which more than 20 pages are unable to be viewed. In a June 14 letter, Nunes and opther Republicans on the House Intel Committee asked President Trump to declassify 21 pages from the release.
“What’s left that’s redacted, the American people really do need to know what’s underneath there,” said Nunes on Sunday.
He also insisted on Sunday that “the Left and the media” do not want additional portions of the FISAs to be made public.
“They don’t want that unredacted. They don’t want transparency for the American people,” he said.
Nunes said that he believes that the president’s lawyers are reviewing the June 14 letter to see if the 20 pages can be made public. –Daily Caller
Meanwhile, the portions which were able to be read from the 412-page release revealed that the FBI relied heavily on the unverified “Steele” dossier, which relied on information from high level Kremlin officials as part of its claims.
If foreign collusion upsets you, then
Steele’s actual collusion w/ Russians (funded by Hillary) should bother you more than the unproven collusion Steele merely alleges against Trump. That it doesn’t suggests the anti-Trump collusion hysteria is insincere. https://t.co/J5f2YTBL4T
To date, there is only one foreigner who without a doubt colluded with Russians to tilt the 2016 election: Christopher Steele, a foreign spy who worked on Hillary’s behalf and lied to the FBI about the full extent of his election meddling during the campaign.
If a foreign spy using Kremlin sources to seed fake stories in the press and bogus investigative leads to the FBI on a campaign’s behalf (and then lying about it to federal authorities) doesn’t bother you, then you don’t actually care about foreign election interference.
Following widespread reports that Twitter is censoring conservative users with the use of “shadowbans,” Nunes said that he and other lawmakers were exploring legal action against the social media giant.
“We were getting caught up in some type of trap to where people couldn’t see our Twitter feed,” said Nunes on Fox’s Sunday Morning Futures, adding: “I don’t know what Twitter is up to. It sure looks to me like they are censoring people and they ought to stop it, and we’re looking at any legal remedies we can go through.”
Nunes’ comments came after several media reports and social media posts noting the phenomenon, capped off by a report by the liberal outlet VICE confirming the claims (albeit they only focused on the “dropdown search” issue and not the “Quality Filter” shadowbans) we reported earlier in the month.
In a bizarre response, Twitter issued a strange explanation to “set the record straight,” where they explicitly state that they do not engage in the practice – except then they describe how they do exactly that.
“People are asking us if we shadow ban. We do not. But let’s start with, “what is shadow banning?”
The best definition we found is this: deliberately making someone’s content undiscoverable to everyone except the person who posted it, unbeknownst to the original poster.” –Twitter
Then, Twitter reiterates they don’t shadow ban – with the caveat in parentheses that you may need to go directly to the timeline of some users in order to see their tweets. (tee hee!)
“We do not shadow ban. You are always able to see the tweets from accounts you follow (although you may have to do more work to find them, like go directly to their profile). And we certainly don’t shadow ban based on political viewpoints or ideology.” –Twitter
In other words, Twitter says they don’t shadow ban – it’s just that tweets from people you follow may never appear unless you click directly into their timeline.
Between documented user reports and a January undercover video from Project Veritas in which then-current and former Twitter employees admit to shadowbanning conservatives, Nunes may have plenty of ammunition.
