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Dollar rises, but inflation concerns remain

The U.S. Dollar Index that tracks the greenback against a basket of other currencies…
The post Dollar rises, but inflation concerns remain first appeared on Trading and Investment News.

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The U.S. Dollar Index that tracks the greenback against a basket of other currencies edged up 0.02% to 90.755

The dollar was up on Friday morning in Asia, set to post a weekly gain. Investors are now beginning to assess the risk that U.S. inflation will rise faster and prompt central bank interest rate hikes sooner than expected.

The U.S. Dollar Index that tracks the greenback against a basket of other currencies edged up 0.02% to 90.755 by 3:23 AM GMT.

The USD/JPY pair inched up 0.14% to 109.61.

The AUD/USD pair edged down 0.06% to 0.7724 and the NZD/USD pair edged up 0.04% to 0.7174.

The USD/CNY pair edged down 0.08% to 6.4457 and the GBP/USD pair edged down 0.07% to 1.4040.

Investors digested even more economic data after inflation data, including the core Consumer Price Index, was higher than expected.

U.S. producer prices released on Wednesday were also higher than expected, with the Producer Price Index adding 0.6% month-on-month and 6.2% year-on-year (YOY) in April.

Further data, including those for retail sales, are due later in the day.

Meanwhile, the number of initial jobless claims for the week dropped to a 14-month low of 473,000.

All the data points to a buildup of inflationary pressure in the U.S., as a strong COVID-19 vaccination program allows for the resumption of economic activity.

The data did, however, fail to budge the U.S. Federal Reserve from its current dovish monetary policy. A slew of officials from the central bank, the latest being Fed Governor Christopher Waller, reiterated that the spike in inflation will be temporary.

But the Fed’s assurance was not enough to calm some investors’ concerns.

Inflation will remain a big theme for markets in the coming few months. The Fed says it will be transitory, but markets are asking ‘what if it turns out not to be transitory, Daiwa Securities senior strategist Yukio Ishizuki told Reuters.

The data also failed to spark a renewed uptick in Treasury yields with the benchmark 10-year Treasuries yield dropping to 1.651%. Some investors accredited the move to the market already pricing in a degree of inflation worries.

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International

Wake-Up Call

Wake-Up Call

Authored by James Howard Kunstler via Kunstler.com,

“Those who organized the disaster will take advantage of the inevitable…

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Wake-Up Call

Authored by James Howard Kunstler via Kunstler.com,

“Those who organized the disaster will take advantage of the inevitable discontent arising from efforts to overcome it, for if there is one thing that they are skilled in, it is demagoguery.”

- Theodore Dalrymple

Can you feel it? The tension rising to the red-line? It runs clear through all of Western Civ. We are ruled by governments of fiends. But now, the sun rides higher in the sky. The sap is rising in the northern forests. The earth heaves. The buds swell and blush. Something is in the air. The animals are waking from their long winter sleep. The natives are restless.

The two traditional political divisions, liberal and conservative died with Covid. Now there are simply the sane versus the insane. The sane have had enough of being pushed around by the insane. The insane don’t register much of what reality tries to tell them. They have a body of insane ideas to comfort and protect them from the reality’s rigors. To call that body of ideas an “ideology” is way too polite.That the insane call themselves “progressive,” is a signature of their insanity.

Progress toward what better state of things? Toward a supremacy of fiends, sadists, degenerates, and morons seizing riches and power by every dishonest means possible outside the rule of law and common decency? It’s not even suitable to call them “communists.” They lack the necessary idealism for that.

They don’t expect to put their shoulders to the wheel with their fellow man. They just want to grab your stuff and then kill you so they don’t have to hear any complaints.

The insane do not believe any of the theoretical bullshit they want to force you to swallow. They don’t care about climate change. It’s just a cudgel they use to beat everyone over the head so they can steal your stuff. They don’t care about “democracy.” It’s just a line of bullshit to cover up their election-stealing. Do you suppose that sane people would keep using electronic vote-tabulating machines that were demonstrably connected to the Internet, and thus hackable, if they cared about election integrity? Of course not. They would arrange p.d.q. to junk them and use paper ballots, and only in person at polling places, with “absentee” exceptions only for people out of the country.

The insane do not care about public health. Everything that is known about the Covid-19 vaccinations tells you that they are unsafe and don’t prevent infection or transmission of a flu-like illness that might not even be what it was officially labeled as. Our public health officials in the FDA, the CDC, and in other corners of the Department of health and Human Services, lie about everything they’re responsible for. This week, the CDC (under Director Mandy Cohen) released a 148-page study on myocarditis reactions to mRNA shots. Every word on every page of the document was redacted. The CDC printed countless copies of the report with 148 utterly blank pages, and then proffered them to the news media. How is that not insane?

The insane do not care about the rule of law. The conduct of “Lawfare” is the subversion of the law by dishonest means. It is a species of racketeering. And that is why Lawfare rogues such Marc Elias, Norm Eisen, Andrew Weissmann, Mary McCord, Lisa Monaco, Matthew Graves, and Merrick Garland, should be charged under the federal RICO statutes for conspiring to deprive sane citizens of their rights and property in the many cases related to the 1/6/21 riot at the US Capitol.

It is, so far, an abiding mystery of contemporary history as to how New York Attorney General Letitia James managed to get away with prosecuting a real estate case against Donald Trump that was no more than victimless business-as-usual between a borrower and his lenders. Ms. James ran for that elected office promising to “get” Mr. Trump on something, anything. That is not how the rule of law works. Under the rule of law, first you determine that there is a crime and then look for who did the crime.

Letitia James must be insane and/or pretty stupid. The short-term gain of stealing Mr. Trump’s property under a false color-of-law and creating impediments to his election campaign, will, sooner or later, blow back at her as a matter of malicious prosecution and, plausibly, racketeering as well. (With whom did she conspire to bring this case? We shall find out.) She will eventually be disgraced publicly as her teammate Fani Willis has already been disgraced in Fulton County, Georgia. I’ll tell you something that all sane people now know but won’t talk about for fear of being crushed by the levers of Lawfare: this looks like a concerted effort by people-of-color to railroad people of non-color. If you think that is a good thing for race relations in our country, then you are insane.

Here are a bunch of other things that are insane: Re-litigating the first amendment is insane. It means what it says, and states it plainly. The open border is insane. No credible sovereign polity would allow it. It would be opposed with force, if necessary. Turning children into transsexuals on a wholesale basis is insane, and fiendishly so. Everybody knows that it is not good for the children or for our society as a whole. But fiends got to fiend, and if you try to deprive them of being fiends then you are guilty of “hate.”

The war in Ukraine is insane. We certainly didn’t ignite it in the service of “democracy.” Our pawn there, Mr. Zelensky, canceled the national elections last year. The war was arguably an effort by our CIA to deprive Russia of its market for natgas in Europe, and thus deprive Russia of a great deal of money, that is, of prosperity. The project failed. Russia overcame NATO’s proxy army and found other markets for its gas. Blowing up the Nord Stream pipelines only served to impoverish and weaken our NATO allies, who no longer have affordable gas to run their industries. The leaders of those allies were too insane to recognize that the Nord Stream op was an act-of-war against them. They were also busy destroying themselves, like the USA, with open borders. They will end up in a new medievalism, ruled by savages. You’d have to be insane to arrange that for yourself.

What’s most obviously insane in our country is that the insane party is pretending to nominate the mentally unfit White House place-keeper, “Joe Biden,” for reelection. You would think that if this party wanted to retain power, they would run a candidate who, though insane, was not also visibly senile. But the rank and file of this party are too insane to see that this dodge is not working. They are pretending with all their might that this is okay, that the growing faction of the sane don’t notice.

Sensing the growing impatience with insanity among the voters, the insane party has reached its point of terminal desperation. What will they try next? Murder? Why not? Nothing else seemed to work. They are too far gone in their insanity to understand that winter is over. We’ve entered the season of rebirth and renewal, starting with a renewed appreciation for being sane and for that indispensable ingredient that makes liberty in a free society possible: good faith. Really, the only question left is: how rough do they intend to play to prevent the return of sanity and good faith?

*  *  *

Support his blog by visiting Jim’s Patreon Page or Substack

Tyler Durden Fri, 03/22/2024 - 16:25

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International

Failed deal leaves another airline facing bankruptcy, liquidation

A planned sale of the airline brand has fallen through, and that leaves its future very much in doubt.

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The business model for airlines has always been tricky and multiple major airlines around the world have needed government bailouts in order to survive. Traditionally, because airlines are essential services, that money has been there both in the United States and around the world.  

In the U.S., about $54 billion was given to airlines to help them survive the covid pandemic. Had that not happened, it's very possible a major carrier would have gone bankrupt. More importantly, every carrier would have had to go into survival mode.

Related: Bad meat forces popular grocery brand into Chapter 11 bankruptcy

That would have mean laying off pilots, and other key personnel that could not be replaced quickly. Had the U.S. not ponied up and rescued its airline industry, it's likely that prices for airfare would be highly elevated and overall capacity would be greatly decreased.  

It's a situation that was not unique to the U.S. The former Air Italia actually closed in 2021 but later began flying again as ITA Airways after a government bailout. In addition, Germany's Lufthansa and Sweden's SAS have received bailout packages (although those are being challenged in court).

Now, with Spirit Airlines  (SAVE)  facing an uncertain future and bankruptcy rumors in the U.S., another big airline has seen a major deal collapse, which puts its future in doubt.

The U.S. government blocked a merger between Spirit and Jetblue.

Image source: Shutterstock/TheStreet

South African Airways faces survival risk

While many Americans may not be overly familiar with South African Airlines (SAA). it's part of the global "Star Alliance," which means it's connected to many of the world's biggest airlines.

"The Star Alliance network was formed in 1997 by Air Canada, Lufthansa, Scandinavian Airlines, Thai, and United Airlines. For the first time, these carriers began working together to offer our customers a worldwide reach and an improved travel experience," SAA shared on its website.

The Alliance has gotten much bigger since its early days.

"Since then, the Alliance has grown to 26 member airlines, including South African Airways which joined the Alliance in 2006. The Star Alliance carriers are among the most respected in the world. To become a member, an airline must offer and comply with the highest industry standards of customer service, security and technical infrastructure. The 26 member airlines operate together more than 18,500 flights a day, reaching 1,330 airports in 192 countries," SAA added.

Now, after a failed deal to sell a majority interest in SAA, the airline faces a threat to its survival.

SAA has 12-18 months left

For three years, the government of South Africa has been negotiating to sell a majority interest in SAA to Takatso Consortium. That's a controversial decision that the South African government intends to investigate.

"The Portfolio Committee on Public Enterprises has reached a decision to refer the matter of the Takatso Consortium’s purchase of a 51% stake in South African Airways (SAA) to the Special Investigating Unit (SIU) for further investigation," according to a media statement from the South African Parliament.

The failed sale puts the future of SAA in a very precarious place.

"The government estimates SAA can sustain itself financially for the next 12 to 18 months. The government has also come to the conclusion that the flag carrier will no longer receive any bailout money. SAA will have to survive on its own or find a new merger partner," World Airline News reported.

SAA's problems actually predate the covid pandemic as it was close to being liquidated in 2019 before filing for bankruptcy which allowed it to keep operating.

The pandemic, however, did hasten its breakdown and greatly contributed to its current dire situation. 

Takatso Consortium pulled out because it did not believe the price being asked was a good value.

"At the end of the day it wasn't about the political pressure, the noise that you are hearing. It came down to, businesswise, as an investor, does this make sense for your stakeholders? Can you continue to drag this process along?" consortium spokesperson Thulasizwe Simelane told DW.com.

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Spread & Containment

GSK to part ways with ‘most’ Bellus Health employees a year after $2B buy

Many of the employees behind GSK’s late-stage investigational drug for chronic cough will be let go at the end of March.
Roberto Bellini
“After having…

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Many of the employees behind GSK’s late-stage investigational drug for chronic cough will be let go at the end of March.

Roberto Bellini

“After having completed the transition activities linked to the GSK acquisition, most Bellus Health employees will be wrapping up their involvement with the company on March 31,” Roberto Bellini, the longtime CEO of Bellus, wrote Thursday on LinkedIn.

A year ago, GSK bought the Canadian biotech for $2 billion for Bellus’ Phase 3 chronic cough candidate, which was expected to compete with Merck’s P2X3 antagonist. That drug was rejected by the FDA for a second time in December.

In his LinkedIn post, Bellini said it was the “end of an era.” He’s now a managing partner at life sciences investor BSquared Capital.

“We’re excited to see GSK complete the last legs of the journey and fulfill our mission of getting this important product to the chronic cough patient community,” Bellini wrote.

GSK, which completed the deal in June, did not disclose the number of roles impacted. In his LinkedIn post, Bellini tagged about 40 people whose profiles list them as Bellus employees.

“During the GSK-Bellus acquisition, we retained employees to a predetermined date to ensure the successful integration of the business,” a GSK spokesperson told Endpoints News. “As often is the case during this process, redundancies may occur.”

GSK is currently running two Phase 3 trials for its lead drug from Bellus, a P2X3 antagonist known as camlipixant or BLU-5937. Data are expected next year, the drugmaker has said.

“We look forward to continuing to drive the CALM Phase 3 clinical development program forward to address the unmet needs of patients living with refractory chronic cough,” the spokesperson wrote.

GSK has described camlipixant as one of its top clinical prospects, and chief commercial officer Luke Miels has said the company projects peak sales in the “single billion dollar” range.

Chronic cough can interrupt daily activities, impair people’s ability to work and disrupt social experiences as some say the condition has been stigmatized due to the Covid-19 pandemic. The pharma has estimated about 10 million people in the US and EU experience refractory chronic cough for more than a year.

Merck has said it’s going through feedback from the FDA’s latest no-go for gefapixant, its chronic cough candidate. The treatment is approved in the EU, Switzerland and Japan.

Other companies in the category include startup Nocion Therapeutics, which this month reeled in $62 million for a Phase 2b this year testing whether its alternative approach to treatment can work. Aldeyra Therapeutics, meanwhile, “deprioritized” its mid-stage treatment candidate in January.

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