WASHINGTON (AP) — US consumer spending fell 0.2% in December as virus hinders economy.
WASHINGTON (AP) — US consumer spending fell 0.2% in December as virus hinders economy.
(Bloomberg) -- The European Union is poised to ban artificial intelligence systems used for mass surveillance or for ranking social behavior, while companies developing AI could face fines as high as 4% of global revenue if they fail to comply with new rules governing the software applications.The rules are part of legislation set to be proposed by the European Commission, the bloc’s executive body, according to a draft of the proposal obtained by Bloomberg. The details could change before the commission unveils the measure, which is expected to be as soon as next week.The EU proposal is expected to include the following rules:AI systems used to manipulate human behavior, exploit information about individuals or groups of individuals, used to carry out social scoring or for indiscriminate surveillance would all be banned in the EU. Some public security exceptions would apply.Remote biometric identification systems used in public places, like facial recognition, would need special authorization from authorities.AI applications considered to be ‘high-risk’ would have to undergo inspections before deployment to ensure systems are trained on unbiased data sets, in a traceable way and with human oversight.High-risk AI would pertain to systems that could endanger people’s safety, lives or fundamental rights, as well as the EU’s democratic processes -- such as self-driving cars and remote surgery, among others.Some companies will be allowed to undertake assessments themselves, whereas others will be subject to checks by third-parties. Compliance certificates issued by assessment bodies will be valid for up to five years.Rules would apply equally to companies based in the EU or abroad.European member states would be required to appoint assessment bodies to test, certify and inspect the systems, according to the document. Companies that develop prohibited AI services, or supply incorrect information or fail to cooperate with the national authorities could be fined up to 4% of global revenue.The rules won’t apply to AI systems used exclusively for military purposes, according to the document.A European Commission spokesman declined to comment on the proposed rules. Politico reported on the draft document earlier.“It’s important for us at a European level to pass a very strong message and set the standards in terms of how far these technologies should be allowed to go,” Dragos Tudorache, a liberal member of the European Parliament and head of the committee on artificial intelligence, said in an interview. “Putting a regulatory framework around them is a must and it’s good that the European Commission takes this direction.”As artificial intelligence has started to penetrate every part of society, from shopping suggestions and voice assistants to decisions around hiring, insurance and law enforcement, the EU wants to ensure technology deployed in Europe is transparent, has human oversight and meets its high standards for user privacy.The proposed rules come as the EU tries to catch up to the U.S. and China on the roll-out of artificial intelligence and other advanced technology. The new requirements could hinder tech firms in the region from competing with foreign rivals if they are delayed in unveiling products because they first have to be tested.Once proposed by the commission, the rules could still change following input from the European Parliament and the bloc’s member states before becoming law.Tudorache said it was critical that the final version of law doesn’t stifle innovation and limits bureaucratic hurdles as much as possible.“We have to be very, very clear in the way we regulate - when, where and in which conditions, engineers and businesses have to actually go to regulators to seek authorization and to be very clear where it’s not,” he said.(Updates with reaction from MEP in 12th, 16th paragraphs)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
(Bloomberg) -- Coinbase Global Inc.’s highly anticipated direct listing had touched off a frenzy in demand for all things crypto. A tumble shortly after its debut dented the euphoria.Bitcoin pulled back from an all-time high as the biggest U.S. crypto exchange tumbled to close down 14%. It opened at $381 a share in its direct listing shortly before 1:30 p.m. in New York and spiked as high as $429 in the first 10 minutes of trading before turning lower. It closed at $328.28. Bitcoin fell to its session low when Coinbase turned, before paring losses. It was trading around $63,160 as of 8:12 a.m. in Hong Kong.The listing is seen pushing crypto even more into the mainstream of investing, exposing legions of potential buyers to digital tokens, which have grown into a $2 trillion industry in little more than a decade. Bitcoin, the original and biggest crypto coin, is valued at more than $1 trillion alone after a more than 800% surge in the past year.At the closing price, Coinbase’s valuation on a fully diluted basis is about $86 billion. Given its size and visibility, Coinbase is likely to be popular with actively managed equity funds, particularly growth managers, essentially making a large swath of stock holders passive investors in crypto.“It’s a huge step forward for the industry and the legitimacy it brings in the eyes of investors and regulators,” Mati Greenspan, founder of Quantum Economics, said on Bloomberg TV.Read more: Bitcoin ETF Drumbeat Gets Louder as Eight Issuers File With SECGrowing mainstream acceptance of cryptocurrencies has spurred Bitcoin to a 120% rally since December, as well as lifting other tokens to record highs. That’s despite lingering concerns over their volatility and usefulness as a method of payment. Attention from regulators is poised to intensify as Coinbase becomes a public company.“As the direct listing on the Nasdaq will reach a wider investment base other than the usual crypto evangelists, investors must expect much greater government scrutiny,” said Nigel Green, CEO and founder of deVere Group.(Updates prices in the third paragraph)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
(Bloomberg) -- Hundreds of thousands of small Indian businesses are planning to protest against large foreign retailers like Amazon.com Inc. in an event Thursday that coincides with the U.S. e-commerce giant’s annual seller jamboree in the South Asian nation, a sign of escalating tensions in the retail market of 1.3 billion people.The summit is the latest protest by local traders, which have long accused global retailers Amazon and rival Walmart Inc.-owned Flipkart of masquerading as platforms and employing unfair practices that hit at the livelihoods of small online and offline sellers. The trader groups’ event is named Asmbhav, or “impossible” in Hindi, and takes place on the first day of Amazon’s annual seller extravaganza, called Smbhav, or “possible.”“Over half-a-million sellers and leading small trader groups are participating in the Asmbhav event which will focus on ruined livelihoods because of the bullying and partisanship by e-commerce marketplaces,” said Abhay Raj Mishra of the non-profit Public Response Against Helplessness and Action for Redressal (PRAHAR), one of the organizers of the event spearheaded by a collective of Indian sellers.India’s small traders, distributors and merchants have petitioned the country’s courts and antitrust regulator to curb the foreign retailing giants ahead of a potential revision of foreign investment rules. The government is expected to tighten regulations that already bar e-commerce platforms from owning or controlling companies that sell on their platform, forging exclusive deals with makers of products such as smartphones, and discounting goods sold on their platforms.Amazon’s seller event -- which made its debut last year with founder Jeff Bezos in attendance -- will span four days this year and be held virtually. Key business figures including former Pepsico Inc. Chief Executive Officer Indra Nooyi, telecom operator Bharti Airtel Ltd.’s Chairman Sunil Mittal, India’s chief economic adviser Krishnamurthy Subramanian and Infosys Ltd. co-founder and Chairman Nandan Nilekani will be among panel speakers. Participants will include small businesses, startups, developers and retailers.To counter Amazon’s Smbhav awards to select sellers, organizers of the protest event will hand out tongue-in-cheek “Asmbhav awards” to Bezos, country chief Amit Agarwal and its India business partner, Narayana Murthy, the billionaire co-founder of Infosys. The event is backed by trade groups like the All India Online Vendors Association and the All-India Mobile Retailers Association.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
Fund managers are trimming exposure to Russia and Ukraine on fears that years of tensions could finally erupt into outright war, bringing economic ruin for Ukraine and more sanctions on Russia. "People are very sanguine," said Tim Ash, senior EM sovereign strategist at BlueBay Asset Management. Concerns about an escalation, including the immediate threat of sanctions, were partly assuaged after a phone call on Tuesday between U.S. President Joe Biden and his Russian counterpart Vladimir Putin in which Biden proposed a summit meeting between the pair and stressed U.S. commitment to Ukraine's territorial integrity.
(Bloomberg) -- The Bank of England’s Chief Economist Andy Haldane will step down in June, removing the the Monetary Policy Committee’s most outspoken contrarian and inflation hawk.Haldane, 53, will leave after career spanning more than three decades at the central bank to become chief executive officer at the Royal Society for Arts, Manufactures and Commerce starting in September. He will remain in place through the bank’s rate decision on June 24. He’s departing as the U.K. emerges from its worst recession in three centuries, which pushed the central bank to unleash unprecedented stimulus including 150 billion pounds ($206 billion) of bond purchases this year. Haldane alone on the nine-member policy panel voiced concerns about inflation accelerating with a rapid bounce-back in growth as Prime Minister Boris Johnson winds back restrictions to contain the Covid-19.“The most interesting element to me is that he is probably the arch-hawk on the MPC, and his removal will certainly see a more dovish tone seep into meetings,” said Stuart Cole, chief macro strategist at Equiti Capital and a former BOE economist.Bank of England Governor Andrew Bailey will appoint a successor after the bank advertises the position. While the chief economist traditionally also sits on the MPC, it’s the Treasury’s decision to name members to that panel.In recent months, Haldane has warned about the risk of excessive pessimism about the economic outlook as the pandemic winds down, terming it “Chicken Licken” economics that could undermine the recovery.While many of his colleagues point out concerns about rising unemployment and signs of sluggishness in the economy, he said he expects a “rip-roaring recovery” and on inflation said a “tiger has been stirred” that may “prove difficult to tame.”Several economists said the improving outlook for the U.K. economy has already shifted debate on the MPC away from extra stimulus and toward whether the pace of bond purchases need to slow -- or even an eventual tightening in policy.“In 2022 the BOE is likely to set out an exit strategy from its ultra-easy policy stance before hiking the bank rate in 2023,” said Kallum Pickering, senior economist at Berenberg.Haldane joined the BOE in 1989 after gaining a masters in economics from Warwick University.He logged experience at the central bank in international finance, market infrastructure and financial stability during the financial crisis before clinching his current role under previous Governor Mark Carney in 2014. That year, “Time” magazine named him one of the world’s 100 most influential people.Haldane is known for his occasionally quirky speeches. He once used Dr. Seuss to bemoan the reading age needed to understand the central bank’s communications.His words sometimes raised eyebrows, notably when he compared pre-crisis economic projections to a famously inaccurate forecast by BBC weatherman Michael Fish before a 1987 storm that killed 18 people.In 2012, he drew the ire of his future boss with a speech -- titled “The Dog and the Frisbee” -- which called for simplicity in banking regulation. Carney, who was then the Bank of Canada governor and head of the global Financial Stability Board, said the speech was “uneven” and the conclusion “not supported by the proper understanding of the facts.”Haldane has also led the government’s Industrial Strategy Council until it was dissolved a few weeks ago and is the co-founder of charity Pro-Bono Economics.“If your business is trying to predict rates and quantitative easing, it will be a bit easier without Andy’s speeches somewhat clouding the issue,” said Tony Yates, a former BOE official who worked with Haldane. “If you’re trying to get up to speed on the latest things in monetary economics and finance, then it’s less good because there won’t be Andy picking up new things and explaining them.”(Updates with context and comment from the first paragraph.)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
(Bloomberg) -- Britain’s financial markets watchdog is looking to upgrade its relationship with the U.S. and give U.K. firms permanent access to American securities and derivatives markets in the wake of Brexit.The Financial Conduct Authority is working closely with the Commodity Futures Trading Commission about a “permanent footing” for U.K. trading venues to operate in the U.S., Nausicaa Delfas, the FCA’s executive director of international, said at a conference on Tuesday.“If granted, this recognition will provide U.K. firms with the certainty they need to conduct their business in the U.S. with confidence,” Delfas said at the City & Financial Global virtual event.The FCA is also in discussions with the Securities and Exchange Commission over access to the U.S. for swap dealers, and the regulator is supporting the U.K. government’s negotiations with the U.S. on a wider trade agreement. These efforts build on agreements made before Brexit came into effect at the start of the year, which pledged to minimize disruption in transatlantic financial markets.“There is much still to be agreed, but we are supportive of an ambitious outcome on financial services that benefits both U.K. and U.S. industries whilst preserving our regulatory objectives and safeguards,” Delfas said.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
Maybe Kohl's management will start getting things right after bowing to pressure from activist investors.
BOSTON/NEW YORK (Reuters) -China's regulatory-imposed revamp of Jack Ma's Ant Group, transforming the hot fintech into a financial holding company, appears to have dented some investor appetite for any plans to revive what would have been the world's biggest IPO. The overhaul comes two days after affiliate Alibaba Group Holding Ltd, which owns around a one-third stake in Ant, was hit with a record $2.75 billion antitrust penalty as China tightens controls on its internet giants. Several Hong Kong and U.S.-based investors, and others who watch China's markets, said the developments seemed to limit the prospects of Ant, lowering its expected profitability and valuation.
Before sitting back and letting the IRS do the work, experts say some people should at least consider filing an amended return.
The IRS commissioner says the child credit payments will arrive on time after all.
Wealthy investor Mike Novogratz speculates that bitcoin could be worth $100,000 by the end of 2021 and sees that value increasing by five-fold by 2024, as the nascent crypto market continues to evolve and grow.
(Bloomberg) -- It turns out it’s not just some of Extended Stay America Inc.’s top shareholders who oppose its proposed $6 billion takeover. Two of the company’s own directors are against it as well.Extended Stay disclosed in a regulatory filing late Tuesday that while the majority of the board approved the deal with Blackstone Group Inc. and Starwood Capital Group, Neil Brown and Simon Turner opposed it, saying the $19.50-a-share price was insufficient, and below similar transactions in recent years.They were also concerned about the timing of the deal in light of a recent rebound in hotel stocks, and the potential for further recovery with the U.S. stimulus plan and increasing Covid-19 vaccinations, the filing shows.Turner was of the belief a transaction below $20 a share was inappropriate, and also was concerned about changes to the termination fee that were made in order for the buyers to raise their bid to $19.50 a share from $19.25, according to the filing.Extended Stay has two boards, one for the C-Corp and one for the real estate investment trust. Both Brown and Turner sit on the REIT board, according to the company’s website.The concerns raised by the two directors are similar to those of five top investors who came out against the deal. Tarsadia Capital LLC, Hawk Ridge Capital Management, SouthernSun Asset Management LLC, Cooke & Bieler LP and River Road Asset Management LLC have all said they plan to vote against the transaction.‘Obviously Inadequate’“We are dismayed that the board would approve such an obviously inadequate price and shocked that the board did so over the objection of two of its own members,” Tarsadia said in an emailed statement.Collectively, the investors own roughly 13% of Extended Stay’s outstanding common stock, according to data compiled by Bloomberg.Representatives for the other opposing investors weren’t immediately available for comment. A representative for Blackstone and Starwood declined to comment.Extended Stay defended its decision to sell, arguing the deal would provide immediate, certain and compelling value for shareholders.“The company ran a thorough, rigorous and thoughtful process, which included a careful consideration of the alternatives available,” a spokesperson said in an email Tuesday. “I would note that the company has thoughtful and independent board members, and paid careful attention to the points raised by the two dissenting directors. However, after detailed discussions, the boards ultimately concluded that the immediate cash certainty at a premium to the valuation over multiple time periods was in the best interest of shareholders.”‘Lose-Lose-Lose’Michael Bellisario, an analyst with Robert W. Baird & Co., said in a note to clients it was “intriguing” that two board members oppose the transaction, and that shareholders seeking a sweetener are likely to focus on this. But he said a voted-down deal would be a “lose-lose-lose” for investors because the company would likely trade back to $16 a share.Extended Stay shares have traded above the offer price since March 22. They were up 0.4% to $19.80 at 12:36 p.m. in New York Tuesday, giving the company a market value of $3.5 billion.Blackstone and Starwood agreed last month to acquire Extended Stay in a 50-50 joint venture in what would be the biggest deal in the hotel industry since Covid-19 decimated the travel business. The filing Tuesday shows that talks between the parties were on and off since 2017, and that at least two other undisclosed potential buyers had expressed interest over the years.Investor Tarsadia had also discussed numerous investment ideas with Extended Stay beginning in August 2020, including various transactions the company could pursue, the documents show.(Updates share price in paragraph 13, adds additional details in final paragraph.)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
(Bloomberg) -- JPMorgan Chase & Co.’s dealmakers just helped usher in the firm’s best quarter on record, but shares fell as the bank warned that loan demand remains tepid.Investment-banking fees soared 57%, beating analysts’ estimates and boosting net income to $14.3 billion, the most JPMorgan has ever earned in a single quarter, according to a statement Wednesday. A larger-than-expected reserve release added to the windfall as the bank determined it didn’t need as much socked away for future loan losses.Government stimulus programs and potentially massive infrastructure spending mean “the economy has the potential to have extremely robust, multiyear growth,” Chief Executive Officer Jamie Dimon said in the statement.Dimon said loan demand is still “challenged” but, on a subsequent conference call with journalists, he said he “made a mistake” in using that word. “What’s happened is the consumer has so much money they’re paying down their credit-card loans, which is good,” he said. “This is not bad news about loan demand, this is actually good news.”The CEO said last week in his annual letter to shareholders that he’s optimistic the pandemic will end with a U.S. economic rebound that could last at least two years. He pointed to an “extraordinary” amount of spending power from both consumers and corporations as the country opens back up.Still, investors are keen for signs that banks will soon expand their loan portfolios. Across the industry, credit-card balances have been dwindling and deposits soaring as a result of trillions of dollars of stimulus. Businesses have also been reluctant to borrow until the pace of the economic recovery becomes clearer.JPMorgan expects a pickup in consumer and small-business loan demand in the second half, Chief Financial Officer Jennifer Piepszak said on a conference call with analysts. Commercial-loan demand is muted and “probably will be for some time,” she said. “But, again, that’s incredibly healthy ultimately for the recovery.”At JPMorgan, loans fell 4% from a year earlier, driven by a 14% drop in card loans. Shares of the company slipped 0.7% to $153.04 at 10:06 a.m. in New York.Investment BankingInvestment-banking fees jumped to $2.99 billion, topping the $2.59 billion analysts were expecting. The bank posted a $5.2 billion reserve release, a metric Dimon said he doesn’t consider “core or recurring profits.” Piepszak said the bank expects more reserve releases because the forecast is for a robust economic recovery in the second half.Equity underwriting more than tripled to $1.06 billion, beating expectations as JPMorgan rode the wave in activity driven in part by a slew of special purpose acquisition companies that went public in the first quarter. The New York-based bank ranked 10th by volume in SPAC underwriting for the period, and fifth for global equity underwriting overall. Analysts had predicted the trend would boost revenue 176% in the first quarter for the five biggest U.S. banks.The bank’s traders generated $9.05 billion of revenue in the first quarter, up 25% from a year earlier and exceeding analysts’ expectations. That included a 47% increase in equities and a 15% jump in fixed income. Trading revenue remained elevated after a banner year as the coronavirus pandemic roiled markets and sent volatility soaring.The firm increased its full-year 2021 adjusted expense outlook to $70 billion, from $69 billion expected in February. Non-interest expenses were $18.7 billion in the first quarter, up 12% from a year earlier.Dimon and Piepszak again discussed JPMorgan’s appetite for acquisitions, a point that was punctuated last week when Dimon wrote in his letter that “acquisitions are in our future.” The CEO echoed previous comments that he prefers to use JPMorgan’s extra cash to invest in the business, rather than on share repurchases.“We’re buying back stock because our cup runneth over,” Dimon said. “We’re earning a tremendous sum of money and we really have no option right now. But I think the door’s open to anything that makes sense.”Also in JPMorgan’s first-quarter earnings:Net interest income was $12.9 billion, down 11% from a year earlier. The firm’s outlook for 2021 NII is about $55 billion.Total revenue was $32.3 billion in the first quarter, up 14% from a year earlier.The overhead ratio, a measure of profitability, was 58% in the quarter, up from 55% in the fourth quarter.(Updates with CEO, CFO comments starting in fourth paragraph.)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
Popular crypto asset, dogecoin, which was engineered as a joke back in 2013, is surging along with a number of crypto assets ahead of the Coinbase IPO.
(Bloomberg) -- China should build more pig farms in Xinjiang as its cotton industry is under threat from declining soil fertility, according to a government researcher, commenting after some international companies avoided fiber produced in the region over allegations of forced labor.Hog farming could become a pillar industry in the region and supply 10% of the nation’s output, up from 1% now, wrote Mei Xinyu, a think-tank researcher at the commerce ministry. Xinjiang already grows more than 80% of the country’s cotton, and some of those pig farms would replace fields sown to the fiber that have been degraded.The suggestion comes after the U.S. banned imports of textile products containing cotton from Xinjiang in protest over alleged ill-treatment of its ethnic Uighur Muslim minority, and several western countries slapped sanctions on China over the same issue.Cotton is the most profitable crop in the region, and rotation to other crops is not in the interests of growers and hard to achieve on a large scale, Mei said on the WeChat account of Beijing News, a government-run newspaper. The only feasible option is to build more hog farms, he said, and they can use local grain to feed the pigs or import supplies from neighboring countries.Xinjiang Production and Construction Corps, a military-affiliated entity, and other groups have already started building several large-scale pig farms, which will increase output significantly in the next two years. In the meantime, animal waste from the farms could be used to boost soil fertility, which has been exhausted by extensive use of chemical fertilizer, said Mei.“The most desirable way to solve this problem is to raise pigs and grow cotton simultaneously, and return a large amount of manure from pig farms to the fields after treatment to enhance soil fertility and increase profits,” Mei said.China should expand hog farms in areas like Xinjiang and Heilongjiang, which are less population-intensive than the inland provinces like Sichuan, Hunan and Henan which dominate the country’s pork production, Mei said. Outbreaks of African swine fever that started in 2018 slashed hog herds by as much as half and sent meat imports spiraling to a record.(Updates with details from the report throughout)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
Coinbase opening at $381 is just the beginning of a climb to $600, according to one analyst.
Federal tax returns are due May 17, but many people still need to pay their first quarter 2021 estimated tax payments April 15. Plus more tax tips.
With COIN stock opening at $250 per share, it amounts to a $25,000 thank-you note to all Coinbase staffers.
The IRS sent out COVID-19 relief checks to nearly 2 million more Americans. It included more than 700,000 "plus-up" payments for people who were eligible for additional money.
Coinbase opened for trading on the Nasdaq on Wednesday.