Futures Jump, Near Record High On "Stimulus, Earnings Optimism"Tyler DurdenMon, 10/12/2020 - 08:06
As Mohamed El-Erian says, this is market that will just keep going up no matter what, and will goalseek whatever narrative it needs to "explain" the levitation catalyzed by $90 trillion in central bank liquidity. Today, that narrative is focusing on - what else - fresh optimism about fiscal stimulus despite there being virtually no hope of Congress reaching a deal before the elections, as well as "improving corporate earnings" with Q3 earnings season set to begin officially tomorrow when US banks start reporting.
All of that combined to push S&P futures 0.5% to fresh five week highs of 3,492 and less than 80 points away from the all time high of 3,568 hit on Sept 2, with the index rising in a straight line for 160 points from its Tuesday lows, while global stocks hit a five-week high led by China’s post-holiday surge as investors bet on a steady recovery for the world’s no. 2 economy, offsetting "worries" about rising COVID-19 cases in Europe and the United States. Oil fell, the dollar rose and Treasuries are closed for Columbus Day. House Speaker Nancy Pelosi and Treasury Secretary Steven Mnuchin are expected to talk more this week about an economic stimulus plan.
"We’re heading for another U.S.-focused week," said Robert Greil, chief strategist at Merck Finck Privatbankiers AG. "There seems to be a bit more hope on a fiscal program breakthrough before the elections, and hopes for a better-than-consensus-based earnings season to start tomorrow", he added pointing out the obvious narrative.
European countries were considering adding fresh travel curbs due to rising coronavirus, a contrast to Asia-Pacific countries including Singapore, Australia and Japan, where a gradual easing of some international travel restrictions is under way. Still, global markets traded higher as investors hoped for coronavirus aid in the United States, with the Trump administration on Sunday calling on Congress to pass a stripped-down relief bill, which of course the Democrats have said they won't consider. But... as El-Erian said, all about the narrative...
On the stimulus front, Nancy Pelosi and Steven Mnuchin were expected to (what else) talk more this week about an economic stimulus plan. Still, even if they manage to strike a deal, there’s almost no chance of getting legislation written and passed by Congress before the election. "There is not a denying of the fact that investors would appreciate easier accessibility to cash and cheaper cash as a result of even more stimulus," said Jameel Ahmad, director of investment strategy at Naga Group AG in London, also pointing out the obvious.
That painfully boring and repetitive narrative was enough to send Europe's Stoxx 600 up 0.5%, with insurers and automakers rising the most among sectors. E-commerce retailer Allegro.eu SA shares jumped as much as 61% in its stock market debut, becoming the largest company on the Poland’s main exchange.
The MSCI index of global stocks was back to its early September highs, mainly driven by a 3% gain in Chinese blue chips. China returned from an eight-day Mid-Autumn festival with investors encouraged by a robust rebound in tourism and ebbing coronavirus cases. “China is playing a bit of catch-up still from Golden Week. I actually think as influential was the announcement about the upcoming Shenzhen reform speech by President Xi,” said Chris Bailey, European strategist at Raymond James.
Chinese President Xi will deliver a key speech in Shenzhen on Wednesday to mark the anniversary of the establishment of the country’s first special economic zone in the southern city 40 years ago, according to state media Xinhua. Chinese blue chips have gained 17% this year, compared with an almost 8% gain by the S&P 500, gaining on optimism that President Xi Jinping is planning to further open parts of the economy to foreign investment. Foreigners' buying of Chinese government bonds hit its fastest pace in more than two years last month. Chinese assets were also boosted by rising chances of Joe Biden’s victory in the U.S. presidential election - an administration seen less likely to incline toward tariffs and trade disputes.
In currency markets, the yuan slumped 0.8% hitting the China-sensitive Australian dollar, on track for its worst single day drop since March after posting the biggest one-day surge since its 2005 de-pegging to the USD, after the People’s Bank of China scrapped a requirement for banks to hold a reserve of yuan forward contracts, removing a guard against depreciation (see more here).
The yuan is up more than 7% since late May and had shot higher on Friday as investors wagered that a Biden presidency would drive smoother relations with the Unites States. It last sat at 6.7437 per dollar in offshore trade. Still, banks expect more yuan upside for now:
"We continue to expect a stronger yuan on the back of our expectation of solid Chinese growth and favourable interest rate differentials between China and the U.S.," Goldman Sachs’ analysts said in a note, with a 12-month yuan forecast at 6.50.
“We still see scope for further yuan appreciation, especially with China’s strong growth momentum, wide yield differential and strong inflows in part due to index inclusion,” said Khoon Goh, head of Asia research at Australia & New Zealand Banking Group Ltd. in Singapore. “But the authorities want to encourage more two-way flows, and removing the reserve requirement will help.”
As the yuan dropped, the dollar gauge advanced as most currency pairs consolidated recent moves versus the greenback, while the Treasury market was closed for Columbus Day. The euro edged 0.2% lower to $1.1805 and the yen firmed to 105.48 per dollar. The kiwi dipped 0.1% with the softer yuan to sit at $0.6661. Most G-10 currencies traded in confined ranges versus the dollar; the Japanese yen led gains while the euro slipped but still held above 1.18 per dollar.
While cash Treasuries are are closed for Columbus Day, Treasury futures were slightly higher across long-end after a lack of weekend progress on a stimulus deal. The German curve bull flattened with long-end yields lower by 1.5bp. Treasury futures imply yields slightly lower across the long-end of the curve, although within a basis point of Friday close.
In commodity markets, oil prices were back under pressure after the resolution of an oilworkers strike in Norway and the resumption of production after a storm in the Gulf of Mexico. Gold held steep Friday gains at $1,929 an ounce.
On the corporate front, earnings from JPMorgan Chase & Co., Citigroup Inc., Goldman Sachs Group Inc. and Johnson & Johnson are due this week.
S&P 500 futures up 0.5% to 3,489.75
STOXX Europe 600 up 0.6% to 372.41
MXAP up 0.6% to 176.47
MXAPJ up 1.1% to 586.14
Nikkei down 0.3% to 23,558.69
Topix down 0.2% to 1,643.35
Hang Seng Index up 2.2% to 24,649.68
Shanghai Composite up 2.6% to 3,358.47
Sensex up 0.2% to 40,603.40
Australia S&P/ASX 200 up 0.5% to 6,131.97
Kospi up 0.5% to 2,403.73
Brent futures down 1.4% to $42.25/bbl
Gold spot down 0.3% to $1,924.18
U.S. Dollar Index up 0.2% to 93.20
German 10Y yield fell 1.3 bps to -0.54%
Euro down 0.1% to $1.1813
Italian 10Y yield fell 3.5 bps to 0.521%
Spanish 10Y yield fell 2.8 bps to 0.148%
Top Overnight News from Bloomberg
The Bank of England is seeking information from U.K. financial institutions on their ability to implement negative interest rates without damaging their business
A push for a ECB green lending program to help the fight against climate change has run into skepticism amid some board members despite attracting the interest of President Christine Lagarde
Boris Johnson will step up efforts to contain the spread of coronavirus, outlining a tiered alert system that would see millions of Britons subject to more stringent curbs on their everyday lives
President Donald Trump and House Speaker Nancy Pelosi blamed each other for a lack of progress on a new plan to support the U.S. economy, while a senior White House aide said he expects talks to continue and a Fed official said fiscal help is sorely needed
A quick look at global markets courtesy of NewsSquawk
APAC equity markets kicked the week off mixed as the region initially failed to fully capitalise on Friday’s Wall Street gains, which were further fuelled by NEC Director Kudlow emphasising US President Trump’s desire for a stimulus package, albeit the weekend brought nothing to fruition on a broader deal and talks are set to continue today. However, sentiment somewhat picked up after the Chinese cash open, ASX 200 (+0.5%) was supported by mining names as executives attend the pandemic-delayed “Diggers and Dealers Mining Forum” where the resources sector presents and showcases projects in arguably the most important event for the sectors, whilst the index was also supported by Link Administration whose shares rose some 25% after a consortium presented a bid for the Co. with a sizeable premium. Nikkei 225 (-0.3%) was hampered by the JPY strength seen on Friday, whilst PPI and Core Machinery data was overall mixed. South Korea’s KOSPI (+0.3%) shrugged off North Korea’s new ICBM unveiling and focused on easing COVID-19 restrictions in the country, while chipmakers in Seoul saw a boost after month-to-date data showed semiconductor exports +11.2% YY. Hang Seng (+2.2%) and Shanghai Comp (+2.3%) were bolstered by the PBoC announcement that it will essentially eliminate the 20% RRR on FX forwards for financial institutions, with China A50 rising 4% at one point. Finally, 10yr JGB futures trade relatively flat as it tracks the broader price action across the fixed income futures complex.
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European equities (Eurostoxx 50 +0.3%) trade with modest gains in what has been a relatively choppy morning thus far. From a macro standpoint, many of the same themes (US stimulus & Presidential Election) remain at forefront of investor focus, however, little in the way of incremental developments have been seen over the weekend. As is stands, President Trump is adamant that he wants to do a deal on stimulus, although, House Speaker Pelosi and Treasury Secretary Mnuchin remain at an impasse in talks. Even if the two were able to broker an agreement, opposition in the Senate remains a key sticking point and as such, the prospects of a pre-stimulus deal remains unlikely. On the election front, polling over the weekend continues to move further in Biden’s favour with his lead extending to 12ppts (prev. 10ppts) against President Trump, according to ABC News/Washington Post. Furthermore, beyond the national headline polling, a Baldwin Wallace University Great Lakes Poll, showed Biden leading Trump by 5-7ppts in swing states such as Michigan, Wisconsin, and Pennsylvania. As such, absent a tightening of the race, increased weight will likely be placed on the prospect of a “blue wave”. From a European perspective, it has been a somewhat uneventful session thus far with performance across indices relatively contained. The main outlier, to the upside is the AEX (+0.7%) amid gains in KPN (+7.3%) with the Co. subject to potential takeover interest from EQT. Elsewhere from a sectoral standpoint, travel & leisure names lag peers as COVID-19 cases across the region continue to climb, whilst energy names are also seen lower, in-fitting with price action in the complex. Daimler (+1.3%) are providing some reprieve to the auto sectors after being upgraded to buy from sell at Goldman Sachs and reiterated overweight at JP Morgan Chase. Stateside, traders will be cognizant of reports noting that EU leaders are said to be drawing up a “hit list” of up to 20 large-cap tech companies, which will likely include Facebook (FB) and Apple (AAPL). The Co.’s on the list will reportedly have to comply with more stringent regulations compared to smaller competitors, sources stated.
Top European News
Europe Braces for Tighter Virus Curbs Amid ‘Tipping Point’ Fears
ECB Doubters Rebuff Green Loan Proposal Despite Lagarde Interest
France Must Avoid General Lockdown by All Means, Castex Says
British Airways Chief Cruz Steps Down in Shakeup at Parent IAG
In FX, the Renminbi has retreated from multi-month peaks against the Dollar around 6.9000 in wake of the PBoC’s decision to slash the RRR on FX Forwards to zero from 20% with immediate effect before regaining some momentum from the latest midpoint fix that was significantly firmer, albeit below expectations at 6.1726 from 6.7796 vs 6.7052 forecast. However, the Lira has not derived any lasting traction from yet more drastic CBRT action to try and arrest its slide via a hike in the rate on reserves to 7% from 5% as Usd/Try trades near the top of a 7.9130-7.8570 band amidst the ongoing Turkish stand-off with Greece, its involvement in the Armenian-Azeri spat and looming test of Russian S-400 missile system.
USD - Notwithstanding the gains noted above, the Greenback spent much of the morning on the backfoot with the DXY initially struggling to keep its head above the 93.000 level within a tight partial-US holiday 93.168-012 range, close to last Friday’s 92.997 low ahead of US CPI data tomorrow, and with no material progress on the fiscal relief front. However, most recently the DXY has gained some traction and printed fresh session highs of 93.227.
CHF - The G10 laggard irrespective of Swiss sight deposits showing a decline in domestic balances and the latest SECO GDP updates revealing a marked upward revision to 2020 GDP, as the Franc pivots 0.9100.
CAD/GBP/NZD/EUR/AUD - All marginally softer relative to their US counterpart, or rather off recent highs with the Loonie hovering below 1.3100 in wake of last Friday’s stellar Canadian jobs report and with the nation observing Thanksgiving today, while Sterling has faded from 1.3050+ peaks amidst more zero and negative rate inferences from the BoE awaiting commentary from Haskel and Governor Bailey, but also monitoring the outcome of further UK-EU trade talks before this week’s Summit. Meanwhile, the Kiwi is straddling 0.6650, Euro holding around 1.1800 where the 50 DMA resides and Aussie retaining 0.7200+ status with support from decent option expiry interest at the strike (1 bn). Back to the Pound, but in the context of the Eur/Gbp cross that is meandering from 0.9076 to 0.9049, technical markers may be influential ahead of the aforementioned Brexit negotiations and Summit in Brussels as the 50 and 100 DMAs are in close proximity at 0.9060 and 0.9036 respectively.
JPY - The Yen has extended recovery gains from sub-106.00 through the 50 DMA (105.78) and away from 1.4 bn expiries at the round number firmer than anticipated Japanese machinery orders, but Usd/Jpy has not made a sustained break of 105.50 to expose last week’s circa 105.23 low.
SCANDI/EM - Softer crude prices are not hampering the Norwegian Crown and perhaps in recognition of the fact that the country’s labour union and oil firms reached a pay deal on Friday to end strike action. Eur/Nok is sub-10.8000 vs Eur/Sek either side of 10.4000 in the run up to Swedish CPI on Tuesday. Elsewhere, buoyant risk sentiment may offer EMs some underlying support, but the Real may miss out given a market holiday in Brazil and the Rand could get some independent impetus from SA manufacturing production.
In commodities, WTI and Brent front month futures have for the most part continued the overnight performance which saw the benchmarks under modest pressure as supply-side developments remain in focus; although, most recently crude prices have stabilised off lows a touch. WTI and Brent are softer by just shy of USD 1.0/bbl each and in proximity to session lows. Returning to those supply side factors; firstly, as Hurricane Delta has passed offshore production is being restored in the Gulf region with Shell sending units into the area to re-commence operations most recently. Secondly, El-Sharara which is Libya’s largest oil field has now restarted production according to sources, this will initially by at ~40k BPD vs. the fields 300k BPD theoretical capacity – at present, no timeline on when the field will return to full production. Finally, strike action is to conclude in Norway after unions came to a new wage agreement after 10-days of disruptions and amidst concerns that the Johan Sverdrup field, ~470k BPD, could have shut this week if the action continued/intensified. Aside from these factors easing supply constraints and thus hampering prices participants look towards both the IEA & OPEC monthly reports due later in the week and, as ever, on the COVID-19 implications for demand. Moving to metals, spot gold is softer this morning as sentiment overall remains cautiously positive but choppy and given the USD’s grinding upside in the latter half of the session. Elsewhere, reports note that Chinese state-owned energy providers/steel mills have received a verbal notice to stop imports of Australian coal with immediate effect; however, the Australian Gov’t has not been notified of any such formal action – a development to keep on the radar given the already strained relations between Australia & China at present.
US Event Calendar
No major earnings releases scheduled
DB's Jim Reid concludes the overnight wrap
I have to say I had an astonishing round of golf over the weekend. I had 6 birdies, a hole in one but lost four balls in the water and ended up on one hole caught up in a windmill and on another in a pirate ship. Yes I played the first round of crazy golf with my kids. It was chaos. That was Saturday and yesterday evening we had to go down the local Covid test center as one of my twins had a very high temperature. We’ll likely know in the next 24 hours as to whether yet another self isolation stint beckons. That would mean even more chaos at home.
Chaos seems to rule in both politics and the virus planning at the moment. On the US election, we were originally scheduled to have the second presidential debate take place on Thursday, but President Trump last week rejected the Commission on Presidential Debate’s proposals for a virtual format. Biden is expected to take questions instead from voters and Trump is expected to have some kind of rally. More and more attention is focusing on the Senate race as Biden now has a double digit lead in the poll of polls (10.4pp according to fivethirtyeight.com). A Washington Post/ ABC News poll which was released yesterday showed Biden leading by 12 points. At the time of writing, FiveThirtyEight’s model puts the chances of a Biden Presidency at 86%, with Democratic control of the Senate at 69%. The latest on the stimulus bill is that both sides are still blaming each other for a lack of progress. It still feels like an agreement before elections is notably less likely than having one.
In terms of weekend news, the PBoC announced on Saturday they are lowering the reserve requirement for some forwards instruments starting from today. This seems to be on concerns around the recent rapidly rising Yuan which saw its biggest rise against the dollar for 15 years on Friday and to 17-month highs. In response, the onshore yuan is trading down -0.39% this morning to 6.7212 as the rule change would make it easier to bet against the currency. Meanwhile, equity markets in the region have also started the week on front foot with the Shanghai Comp (+2.27%) leading the gains partly on the back of news that Chinese President Xi could unveil plans to further open parts of the economy to foreign investment. The Hang Seng (+2.03%), Kospi (+0.30%) and Asx (+0.28%) are also trading higher while the Nikkei (-0.31%) is bucking the trend. Futures on the S&P 500 are trading up +0.14%.
In other weekend news, the ECB chief economist Philip Lane said in an interview with the WSJ that the ECB isn’t happy with the inflation outlook and will decide “meeting by meeting” whether more monetary stimulus will be needed. He said that “the current inflation level remains far away from our goal and we don’t think that is a satisfactory inflation outlook.” Meanwhile, the governing council member Ignazio Visco said in a separate interview with Il Corriere della Sera that monetary policy “must be expansive and remain so for a long time” while another member Peter Kazimir told the Hospodarske Noviny newspaper the ECB will do “everything” to lift inflation. So, seems like a concerted effort from the ECB but I suppose we’ve heard this before.
On the virus, the UK reported over 100,000 cases last week which was higher than 68103 a week ago. As the virus continues to spread in the UK, further restrictions are expected to be announced today in areas with high cases. France also reported a total of 115604 cases last week compared to 80621 a week ago. Italy (29621 vs. 15459), the Netherlands (39059 vs 27673), Belgium (29308 vs 14820) and Germany (24736 vs. 15234) also reported higher cases this past week. Across the other side of Atlantic, the US also saw 340,894 new cases last week as against 311,428 a week ago. Meanwhile, in Asia, South Korea revised its social distancing alert to its lowest as the second wave has come more under control. See the table below for the latest case numbers. As ever the 7-day rolling number is the best one to follow.
In terms of the highlights for the week ahead, US earnings season kick offs, with a number of financials releasing this week. There will be some attention on the European Council summit on Thursday and Friday at an important point in the UK-EU negotiations. This meeting has previously been Prime Minister Johnson’s self-imposed deadline to reach agreement on a trade deal. It seems progress has been made and if this continues I would expect talks to continue beyond that self imposed UK deadline. Mr Johnson held weekend talks with Macron and Merkel so the right people are talking. The press (Bloomberg) are reporting that the French are digging in their heels over fishing rights and this is now the main issue.
In terms of the regular data and central bank calendar, this week is a fairly quiet one. On the data side, we’ll start to see some hard data from the US for September, with the release of the CPI (Tuesday), retail sales and industrial production figures (both Friday). China will also be releasing their trade balance for September (Tuesday), and we’ll also get the Euro Area’s industrial production for August (Wednesday). On the central bank side, the two G20 decisions expected next week will come from Bank Indonesia on Tuesday and the Bank of Korea on Wednesday, with the consensus expecting rates to stay on hold in both cases. Otherwise there’ll be a number of speakers, including Fed Vice Chairs Clarida and Quarles, and Bank of England Governor Bailey. We will also see the IMF/World Bank annual meetings taking place as well with the latest forecasts out tomorrow.
In terms of US earnings a number of financials will lead the way. As for the highlights, we’ll hear tomorrow from Johnson & Johnson, JPMorgan Chase, Citigroup and BlackRock. Then on Wednesday, we have UnitedHealth Group, Bank of America, ASML, Wells Fargo, Goldman Sachs and United Airlines. Thursday sees releases from Morgan Stanley and Walgreens Boots Alliance. And on Friday we’ll get earnings from Honeywell International and BNY Mellon. See DB earnings’ season preview here.
Staying with advertising, DB will be hosting another Global Macro Client Call with DB Heads of Trading & Research/Strategy on 15th October 2020 at 2:00pm CET. Click here to access registration details.
Elsewhere our corporate credit research team has recently published its latest quarterly list of trade ideas in the European leveraged finance space. A video in which analyst team summarises their trade recommendations can be accessed here.
In terms of recapping last week, US fiscal stimulus dominated market commentary as the President, his advisors, and Congressional leadership all seemed to be at odds on the likelihood of a follow on stimulus package being passed ahead of the election. Though the market was skittish to the various headlines, overall seemed to look through the November election and focus on the increasing probabilities of a Biden administration and the high probability that significant stimulus could come slightly further down the road. The S&P 500 rose +3.84% (+0.88% Friday) on the week, the largest weekly gain since the week ending on July 3. The index is now down just under 3% from all-time highs. The NASDAQ rose +4.56% (+1.39% Friday) for the tech-concentrated index’s third weekly gain in a row. The VIX volatility index fell -1.4pts to 25.0, the lowest level since late August. European equities rose as well with the Stoxx 600 ending the week +2.11% higher (+0.55% Friday), the fourth weekly gain out of the last five weeks. Rising risk sentiment kept equites churning higher even as newly confirmed Covid-19 cases hit new highs across Europe, with the IBEX (+2.91%), FTSE 100 (+1.94%), and CAC (+2.53%) all posting strong weekly equity performances.
The dollar dropped (-0.84%) for a second straight week as risk assets rose to their highest level in over a month. The drop in the dollar saw gold gain +1.61%, with the precious metal rising to $1930/oz and edging back closer to the all time high of $2063.54/oz seen on August 06. With risk assets rising and the dollar falling, oil prices rebounded from the previous week’s precipitous drop. Brent crude prices rose +9.12% to $42.85 and WTI prices rose +9.58% to $40.60. It was the largest move for oil prices since the start of June. Core sovereign bond yields rose as investors turned toward riskier assets last week. US 10yr Treasury yields rose +7.3bps (-1.2bps Friday) to finish at 0.774% and 10yr Gilt yields rose +3.4bps (-0.9bps Friday) to 0.28%, while 10yr Bund yields were up just +0.9bps (-0.4bps Friday) to -0.53%. 10yr BTPs continue to tighten with yields falling -6bps (-3.5bps on Friday). Elsewhere in fixed income, corporate credit spreads tightened on both sides of the Atlantic. US high yield cash spreads tightened -46bps, while IG spreads tightened -8bps. Here in Europe, HY cash spreads were -19bps tighter as IG spreads came in -5bps.
In terms of data released on Friday, UK GDP growth for August came in lower than expected at 2.1% (vs 4.6% expected), which was well below last month’s revised 6.4%. French industrial production was also below expectations at 1.3% (vs 1.7% expected). However in Italy, industrial production surprised to the upside coming in at +7.7% (vs 1.4 % expected) after last month’s reading was revised down to +7.0%. Lastly, August’s reading for wholesale inventories in the US rose 0.4%, just a tenth under expectations.
In this specific predicament, U.S. officials have to choose a strategy to deliver the aid without the perception of benefiting Hamas, a group the U.S. and Israel both classify as a terrorist organization.
When aiding people in war zones, you can’t just send money, a development strategy called “cash transfers” that has become increasingly popular due to its efficiency. Sending money can boost the supply of locally produced goods and services and help people on the ground pay for what they need most. But injecting cash into an economy so completely cut off from the world would only stoke inflation.
So the aid must consist of goods that have to be brought into Gaza, and services provided by people working as part of an aid mission. Humanitarian aid can include food and water; health, sanitation and hygiene supplies and services; and tents and other materials for shelter and settlement.
Due to the closure of the border with Israel, aid can arrive in Gaza only via the Rafah crossing on the Egyptian border.
The U.S. Agency for International Development, or USAID, will likely turn to its longtime partner on the ground, the United Nations Relief and Works Agency, or UNRWA, to serve as supply depots and distribute goods. That agency, originally founded in 1949 as a temporary measure until a two-state solution could be found, serves in effect as a parallel yet unelected government for Palestinian refugees.
USAID will likely want to tap into UNRWA’s network of 284 schools – many of which are now transformed into humanitarian shelters housing two-thirds of the estimated 1 million people displaced by Israeli airstrikes – and 22 hospitals to expedite distribution.
Since Biden took office, total yearly U.S. assistance for the Palestinian territories has totaled around $150 million, restored from just $8 million in 2020 under the Trump administration. During the Obama administration, however, the U.S. was providing more aid to the territories than it is now, with $1 billion disbursed in the 2013 fiscal year.
The United Nations Relief and Works Agency is a U.N. organization. It’s not run by Hamas, unlike, for instance, the Gaza Ministry of Health. However, Hamas has frequently undermined UNRWA’s efforts and diverted international aid for military purposes.
Humanitarian aid professionals regularly have to contend with these trade-offs when deciding to what extent they can work with governments and local authorities that commit violent acts. They need to do so in exchange for the access required to help civilians under their control.
Similarly, Biden has had to make concessions to Israel while brokering for the freedom to send humanitarian aid to Gaza. For example, he has assured Israel that if any of the aid is diverted by Hamas, the operation will cease.
This promise may have been politically necessary. But if Biden already believes Hamas to be uncaring about civilian welfare, he may not expect the group to refrain from taking what they can.
Security best practices
What can be done to protect the security of humanitarian aid operations that take place in the midst of dangerous conflicts?
Under International Humanitarian Law, local authorities have the primary responsibility for ensuring the delivery of aid – even when they aren’t carrying out that task. To increase the chances that the local authorities will not attack them, aid groups can give “humanitarian notification” and voluntarily alert the local government as to where they will be operating.
Under the current agreement between the U.S., Israel and Egypt, the convoy will raise the U.N. flag. International inspectors will make sure no weapons are on board the vehicles before crossing over from Arish, Egypt, to Rafah, a city located on the Gaza Strip’s border with Egypt.
The aid convoy will likely cross without militarized security. This puts it at some danger of diversion once inside Gaza. But whether the aid convoy is attacked, seized or left alone, the Biden administration will have demonstrated its willingness to attempt a humanitarian relief operation. In this sense, a relatively small first convoy bearing water, medical supplies and food, among other items, serves as a test balloon for a sustained operation to follow soon after.
In that case, the presence of U.S. armed forces might provoke attacks on Gaza-bound aid convoys by Hamas and Islamic jihad fighters that otherwise would not have occurred. Combined with the mobilization of two U.S. Navy carrier groups in the eastern Mediterranean Sea, I’d be concerned that such a move might also stoke regional anger. It would undermine the Biden administration’s attempts to cool the situation.
On U.N.-approved missions, aid delivery may be secured by third-party peacekeepers – meaning, in this case, personnel who are neither Israeli nor Palestinian – with the U.N. Security Council’s blessing. In this case, tragically, it’s unlikely that such a resolution could conceivably pass such a vote, much less quickly enough to make a difference.
Topher L. McDougal does not work for, consult, own shares in or receive funding from any company or organization that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.
“The majority of wound infections often manifest themselves immediately postoperatively, so close followup should take place […]”
Credit: 2023 Barbarewicz et al.
“The majority of wound infections often manifest themselves immediately postoperatively, so close followup should take place […]”
BUFFALO, NY- October 20, 2023 – A new research perspective was published in Oncoscience (Volume 10) on October 4, 2023, entitled, “Diagnosis and management of postoperative wound infections in the head and neck region.”
In everyday clinical practice at a department for oral and maxillofacial surgery, a large number of surgical procedures in the head and neck region take place under both outpatient and inpatient conditions. The basis of every surgical intervention is the patient’s consent to the respective procedure. Particular attention is drawn to the general and operation-specific risks.
Particularly in the case of soft tissue procedures in the facial region, bleeding, secondary bleeding, scarring and infection of the surgical area are among the most common complications/risks, depending on the respective procedure. In their new perspective, researchers Filip Barbarewicz, Kai-Olaf Henkel and Florian Dudde from Army Hospital Hamburg in Germany discuss the diagnosis and management of postoperative infections in the head and neck region.
“In order to minimize the wound infections/surgical site infections, aseptic operating conditions with maximum sterility are required.”
Furthermore, depending on the extent of the surgical procedure and the patient‘s previous illnesses, peri- and/or postoperative antibiotics should be considered in order to avoid postoperative surgical site infection. Abscesses, cellulitis, phlegmone and (depending on the location of the procedure) empyema are among the most common postoperative infections in the respective surgical area. The main pathogens of these infections are staphylococci, although mixed (germ) patterns are also possible.
“Risk factors for the development of a postoperative surgical site infection include, in particular, increased age, smoking, multiple comorbidities and/or systemic diseases (e.g., diabetes mellitus type II) as well as congenital and/ or acquired immune deficiency [10, 11].”
Continue reading the paper: DOI:https://doi.org/10.18632/oncoscience.589
Correspondence to: Florian Dudde
Keywords: surgical site infection, head and neck surgery
Oncoscience is a peer-reviewed, open-access, traditional journal covering the rapidly growing field of cancer research, especially emergent topics not currently covered by other journals. This journal has a special mission: Freeing oncology from publication cost. It is free for the readers and the authors.
To learn more about Oncoscience, visit Oncoscience.us and connect with us on social media:
A year after the Supreme Court struck down President Biden’s student loan forgiveness plan, he presented a new scheme to the Department of Education on Tuesday. While it is less aggressive than the prior plan, this proposal would cost hundreds of billions of taxpayer dollars, doing more harm than good.
As the legendary economist Milton Friedman noted, “One of the great mistakes is to judge policies and programs by their intentions rather than their results.”
Higher education in America is costly, and this “forgiveness” would make it worse.
Signing up for potentially life-long student loans at a young age is too normalized. At the same time, not enough borrowers can secure jobs that offer adequate financial support to pay off these massive loans upon graduation or leaving college. These issues demand serious attention. But “erasing” student loans, as well-intentioned as it may be, is not the panacea Americans have been led to believe.
Upon closer examination, the President’s forgiveness plan creates winners and losers, ultimately benefiting higher-income earners the most. In reality, this plan amounts to wealth redistribution. To quote another top economist, Thomas Sowell described this clearly: “There are no solutions, only trade-offs.”
Forgiving student loans is not the end of the road but the beginning of a trade-off for a rising federal fiscal crisis and soaring college tuition.
When the federal government uses taxpayer funds to give student loans, it charges an interest rate to account for the cost of the loan. To say that all borrowers no longer have to pay would mean taxpayers lose along with those who pay for it and those who have been paying or have paid off their student loans.
Let’s consider that there will be 168 million tax returns filed this year. A simple calculation suggests that student loan forgiveness could add around $2,000 yearly in taxes per taxpayer, based on the CRFB’s central estimate.
Clearly, nothing is free, and the burden of student loan forgiveness will be shifted to taxpayers.
One notable feature of this plan is that forgiveness is unavailable to individuals earning over $125,000 annually. In practice, this means that six-figure earners could have their debts partially paid off by lower-income tax filers who might not have even pursued higher education. This skewed allocation of resources is a sharp departure from progressive policy.
Inflation remains high, affordable housing is a distant dream, and wages fail to keep up with soaring inflation. Introducing the potential of an additional $2,000 annual tax burden at least for those already struggling, mainly to subsidize high-income earners, adds insult to injury.
Furthermore, it’s vital to recognize that the burden of unpaid student loans should not fall on low-income earners or Americans who did not attend college. Incentives play a crucial role in influencing markets.
By removing the incentive for student loan borrowers to repay their debts, we may encourage more individuals to pursue higher education and accumulate debt without the intention of paying it back. After all, why would they when it can be written off through higher taxes for everyone?
The ripple effect of this plan could be far-reaching.
It may make college more accessible for some, opening the floodgates for students and the need for universities to expand and hire more staff, leading to even higher college tuition. This perverse incentive will set a precedent that will create a cycle of soaring tuition, which would counteract the original goal of making higher education more affordable.
While the intention behind President Biden’s student loan forgiveness may appear noble (in likelihood, it is a rent-seeking move), the results may prove detrimental to our nation’s economic stability and fairness. And if the debt is monetized, more inflation will result.
Forgiving student loans will exacerbate existing problems, with the brunt of the burden falling on lower-income Americans. Instead of improving the situation, it will likely create an intricate web of financial consequences, indirectly affecting the very people it aims to help. But that is the result of most government programs with good intentions.
Vance Ginn, Ph.D., is president of Ginn Economic Consulting, chief economist or senior fellow at multiple state thinks across the country, host of the Let People Prosper Show, and previously the associate director for economic policy of the White House’s Office of Management and Budget, 2019-20. Follow him on X.com @VanceGinn.