Category: Legislation

Daily Briefing – 544

Post: Jul. 19, 2022

Chipmakers Get Their $54 billion in CHIPS Act Government Subsidies—But it Comes With Strings Attached

The Senate backed by 64 to 34 a procedural measure setting the stage for potential votes to pass the legislation in the Senate and House of Representatives by the end of next week. The Bill authorizes about $54 billion in grants and loans for chip manufacturers, as well as a new, four-year 25% investment tax credit for chip making.

Semiconductor companies have been torn over how to perceive the bill, given that it disproportionately benefits semi manufacturers, like Intel over semi designers, such as NVIDIA and Advanced Micro Devices. Analyst estimate that the actual amount of funding available for chipmakers will dwindle down to about $38 billion from the headline figure of $52 billion when accounting for federal research programs and administrative overhead expenses.

Read more at Reuters

War in Ukraine Headlines

BofA Survey: Fund Managers’ Pessimism About Global Growth Deepens

According to a survey from Bank of America of 293 fund managers who oversee a total of $800 billion in assets, expectations of global growth were at a net -79% in July, a new low in the history of the survey after reaching its previous all-time low of a net -73% in June.

When asked how they see the global economy trending over the next 12 months, 90% said they expect stagflation (below-trend growth and above-trend inflation), which was up from 83% in June and represented the highest percentage in the history of the survey.

White House Could Declare Climate Emergency as Soon as Wednesday

President Biden could declare a climate emergency as soon as Wednesday, two sources familiar with the plans told The Hill on Tuesday. One of the sources said that federal agencies are expecting an executive order declaring a climate emergency as soon as tomorrow, but it’s not entirely clear what it will entail.

The move comes as hopes for climate action on Capitol Hill have stalled, as swing vote Sen. Joe Manchin (D-W.Va.) backed away from talks last week following months of negotiations. The potential climate legislation, as part of Biden’s broader economic agenda, was expected to include major investments in clean energy.

Read more at The Hill

U.S. COVID – The Booster Dilemma

According to US CDC estimates, BA.5 is now responsible for 78% of all new COVID-19 cases. Officials have stressed that booster doses provide additional protection against earlier Omicron subvariants and potentially later subvariants as well. However, current boosters have not yet been updated to more specifically target Omicron and its subvariants, leaving a dilemma for eligible individuals about whether to get a booster now or wait for updated versions.

Only 34% of the US population aged 5 years or older has received their first booster dose. Additionally, some experts wonder and worry whether BA.5 will even be the predominant variant in the fall, potentially making new boosters less effective than expected.

NYS Vaccine and COVID Update –

Editor’s Note: Given the small changes in vaccinations we will no longer track this information in the briefing. Instead we will provide a link to the NYS Vaccination Tracker below)

The Governor updated COVID data through July 7. There were 20 COVID related deaths for a total reported of 72,417

Hospitalizations:

Patients Currently in Hospital statewide: 2,458
Patients Currently in ICU Statewide: 237

7 Day Average Positivity Rate – Cases per 100K population

Statewide 8.99% – 36.84 positive cases per 100,00 population
Mid-Hudson: 8.55% – 31.44 positive cases per 100,00 population

Useful Websites:

CDC Panel Gives Green Light to Novavax COVID-19 Vaccine

A Centers for Disease Control and Prevention (CDC) advisory committee on Tuesday unanimously voted to recommend the Novavax COVID-19 vaccine, giving a green light to a fourth shot to fight the virus. Following the panel’s 12-0 vote, CDC Director Rochelle Walensky will have the final step to sign off on the vaccine. The Biden administration previously announced it was purchasing 3.2 million doses of Novavax.

Novavax is intended for initial vaccine doses, not as a booster. Some hope that it could play a role persuading the vaccine-hesitant to get their shots as the Novavax vaccine uses a more traditional vaccine technology, compared to the mRNA technology used by Pfizer and Moderna. Therefore, it could influence those who had reservations about the Pfizer and Moderna products.

Read more at The Hill

U.S. Housing Starts Drop to Lowest in Nine Months in June

Housing starts fell 2% to a seasonally adjusted annual rate of 1.559 million units last month, the lowest level since September 2021, the Commerce Department said on Tuesday. Data for May was revised higher to a rate of 1.591 million units from the previously reported 1.549 million units. Economists polled by Reuters had forecast starts would come in at a rate of 1.580 million units. Permits for future homebuilding fell 0.6% to a rate of 1.685 million units.

The housing market is very sensitive to interest rates, and, with the Federal Reserve lifting rates aggressively to blunt inflation running at its highest in four decades, the market has softened notably this year. The average contract rate on a 30-year fixed-rate mortgage climbed to nearly 6% in June, up from about 3.3% at the start of the year, which has put home purchases out of reach for a growing number of prospective buyers, particularly first-time purchasers.

Read more at YahooFinance

Homebuilder Sentiment Plunges in July as Buyers Pull Back

The National Association of Home Builders/Wells Fargo Housing Market Index, a survey designed to gauge market conditions, found builder sentiment dropped 12 points to 55. That marked the largest single-month drop in the survey’s 37-year history with the exception of April 2020, when the reading plummeted 42 points to 30 after the start of the Covid-19 pandemic.

Any rating above 50 on the index is still considered positive, but sentiment has now fallen 24 points since March, when mortgage rates began moving higher. The average rate on the 30-year fixed mortgage has nearly doubled since January and is now hovering just below 6%.

Read more at CNBC

‘Real’ Home Borrowing Costs Spike

A key but little noticed housing metric is what might be called “the real home borrowing cost.” That number encapsulates potential buyers’ expectations on whether, and by how much, future appreciation will either exceed or lag the current interest rate on 30-year mortgages.

The problem: This gift of high “negative” borrowing costs exists only in gangbusters markets. The bash ends when some combination of rising rates and perception that prices will flatten or decline reverses the trend so that your monthly nut gets costlier than your hoped-for windfall selling your home 7 or 8 years hence. That just happened in most US Markets.

Read more at Fortune

Apple to Slow Hiring, Spending for Some Teams Next Year

Apple Inc plans to slow hiring and spending growth next year in some units to cope with a potential economic downturn, Bloomberg News reported on Monday, citing people with knowledge of the matter. The potential move would see Apple – the world’s most valuable company – join a growing pool of American corporations including Meta Platforms and Tesla Inc in slowing hiring.

Read more at Reuters

Wheeler Takes Over as SUNY New Paltz President

Dr. Darrell Wheeler said he is “exhilarated and humbled” to start his new job as president of SUNY New Paltz. He took over on Monday from Dr. Donald Christian, who retired after serving the school for several years.

Wheeler most recently served as provost and senior vice president for Academic Affairs at Iona College. Prior to that, he served as dean of the School of Social Welfare and vice president for Public Engagement at the University of Albany, dean for the School of Social Work at Loyola University Chicago, and held academic positions at Hunter College, CUNY, Columbia University, and the University of North Carolina at Greensboro.

China Reports 691 New COVID Cases on July 16 vs 547 a Day Earlier

Mainland China reported 691 new COVID-19 cases on Saturday, of which 154 were symptomatic and 537 were asymptomatic, the National Health Commission said on Sunday. That compares with 547 new cases a day earlier – 129 symptomatic and 418 asymptomatic infections, which China counts separately.

The southwestern city of Chengdu, which reported 7 local cases on Sunday as of 4:00 p.m. (0800 GMT), closed some of the entertainment businesses such as bars and karaoke sites and rolled out capacity limits at restaurants, cinemas and gyms. A negative COVID test result within the 48 hours will also be required for people to leave the city from 6 p.m. on Monday, the local government said.

Read more at Reuters

Hochul Spent $28 Million on Primary Win, Far Outspending Opponents

Governor Kathy Hochul has raised more than $38.8 million for her campaign — the vast majority of it in the 11 months since she became governor — and spent a whopping $26 million to win the June 28 Democratic primary, according to the latest campaign finance filings with the State Board of Elections.

Heading into the fall general election, Hochul and her running-mate, Lieutenant Governor Antonio Delgado, are facing Republican gubernatorial nominee Rep. Lee Zeldin of Long Island and lieutenant governor nominee Alison Esposito. Zeldin emerged victorious from a contentious four-way primary. Hochul and Delgado have a major fundraising advantage. Hochul has about $11.2 million in cash on hand and Delgado has about $1 million, per those latest filings, while Zeldin has $1.6 million and Esposito just over $2,000. For the primary, Zeldin was able to raise $12.4 million, and spent $10.5 million, per his filing.

Delta Orders 100 Boeing MAX Jets Worth $13.5 Billion

Delta agreed on Monday to buy 100 medium-haul Boeing MAX passenger aircraft worth a combined $13.5 billion, in a vote of confidence for the crisis-hit jet. The gigantic deal, announced by embattled U.S. plane maker Boeing on the first day of the Farnborough Airshow, includes options for 30 more of the planes.

The news comes as airlines across the world seek to replace their ageing fleets with fuel-efficient planes that emit less carbon dioxide. Delta said that the new 737-10 jets would curb fuel use and emissions by between 20-30% compared with the aircraft they are replacing. Shortly afterwards, Boeing announced that Japanese airline ANA has also agreed to purchase 20 of its smaller MAX 8 jets — an order worth $2.4 billion — plus two 777-8 freight planes.

Read more at IndustryWeek

Man It’s Hot – 10 Key Elements for a Workplace Heat Safety Program

Anyone, regardless of age or physical fitness, can experience heat illness. However, some people may have more difficultly shedding excess body heat and are at a higher risk, such as those who are older, overweight or obese, have diabetes, have heart disease and have hypertension or high blood pressure. The Centers for Disease Control and Prevention estimates that 48% of U.S. adults have hypertension and 40% are obese, making it likely that at least half of the workforce is at an increased risk for heat illness.

OSHA is focusing on heat safety in the workplace and will be conducting more worksite audits under its National Emphasis Program for Outdoor and Indoor Heat-Related Hazards. You need to make sure your workplace is prepared to keep employees safe while working in heat. Here are 10 key elements for a workplace heat safety program.

Read more at EHS Today

Daily Briefing – 543

Post: Jul. 18, 2022

NY DOL Assessing Surcharge on SUI Wages

As a result of COVID-19, the New York Department of Labor (DOL) paid more than $110 billion in unemployment and pandemic unemployment benefits between March 2020 and September 2021 depleting the Unemployment Insurance (UI) Trust Fund. New York state borrowed $9.2 billion from the federal government to maintain UI and pandemic benefits while the COVID-19 programs were in effect. State law requires employers to pay an annual Interest Assessment Surcharge (IAS) on the federal loan and In July, you will receive an IAS notice.

The rate is 0.23% of SUI wages.
The calculation is on SUI from the fourth quarter 2020 through the third quarter of 2021. These are SUI wages from October 1, 2020, to September 30, 2021.
The agency estimates the amounts to be approximately $27.60 per employee.
This will be an annual payment until all interest on the federal loan has been paid off, unless the federal government abates any of the interest due on the loan.
The payment due date is September 30, 2022.

War in Ukraine Headlines

The J.P. Morgan Global Manufacturing PMI Falls to its Lowest Reading Since August 2020.

The J.P. Morgan Global Manufacturing PMI inched down from 52.3 in May to 52.2 in June, the lowest reading since August 2020. Manufacturers continued to grapple with supply chain, inflationary, workforce and geopolitical challenges. The underlying data were mixed. On the one hand, output (up from 49.6 to 52.5) rebounded after contracting in both April and May, and exports (up from 47.9 to 49.5) stabilized somewhat, despite declining for five of the past six months. On the other hand, growth in new orders (down from 50.9 to 50.1) stalled, and employment (down from 51.6 to 51.4) and future output (down from 60.7 to 59.3) measures eased. It was the lowest reading for expected production in two years.

Although the index for delivery times (up from 38.8 to 42.3) continued to reflect long wait times related to supply chain bottlenecks and raw material challenges, it improved to the best reading since November 2020. At the same time, input prices (down from 70.3 to 68.6) and output prices (down from 61.5 to 60.5) decelerated in June, although they remained elevated.

Fed Officials Mull 100 Basis Point Increase After Big Inflation Numbers Last Week

Federal Reserve officials have signaled they are likely to raise interest rates by 0.75 percentage point later this month, for the second straight meeting, as part of an aggressive effort to combat high inflation. They also left the door open to a larger, full-percentage-point increase at the July 26-27 gathering. Some officials pointed to signs that economic activity was softening as they raise rates at a historically brisk pace. “You don’t want to overdo the rate increases. A 75-basis-point hike, folks, is huge,” Fed governor Christopher Waller said Thursday at a conference in Victor, Idaho. “Don’t say, ‘Because you’re not going 100, you’re not doing your job.’”

Before last week, officials had signaled they were leaning toward a 0.75-point, or 75-basis-point, increase this month. After another scorching inflation report was released Wednesday, however, they indicated they would consider a full-point increase.

Read more at the WSJ

U.S. COVID – Covid Rises Across U.S. Amid Muted Warnings and Murky Data

Covid-19 is surging around the United States again in what experts consider the most transmissible variant of the pandemic yet. But something is different this time: The public health authorities are holding back.

More than two years after the pandemic began public health officials are sounding only quiet warnings amid a picture that they hope has been changed by vaccines, treatments and rising immunity. Deaths are rising, but only modestly so far in this new wave. And state and local public health officials say they also must now factor in a reality that is obvious along the streets from Seattle to New York City: Most Americans are meeting a new Covid wave with a collective shrug, shunning masks, joining crowds indoors and moving on from the endless barrage of virus warnings of months past.

NYS Vaccine and COVID Update –

Editor’s Note: Given the small changes in vaccinations we will no longer track this information in the briefing. Instead we will provide a link to the NYS Vaccination Tracker below)

The Governor updated COVID data through July 7. There were 20 COVID related deaths for a total reported of 72,417

Hospitalizations:

Patients Currently in Hospital statewide: 2,458
Patients Currently in ICU Statewide: 237

7 Day Average Positivity Rate – Cases per 100K population

Statewide 8.99% – 36.84 positive cases per 100,00 population
Mid-Hudson: 8.55% – 31.44 positive cases per 100,00 population

Useful Websites:

Anthony Fauci to Retire by End of U.S. President Biden’s Term

Dr Anthony Fauci, an infectious disease expert who is the chief medical adviser to U.S. President Joe Biden, will retire by the end of Biden’s term, he told Politico in an interview on Monday. Fauci, 81, has been the director of the National Institute of Allergy and Infectious Diseases (NIAID) since 1984 and became the face of the U.S. government’s efforts to contain the COVID-19 pandemic.

Notably, when asked what he wants his legacy to be, it’s not the coronavirus response. Fauci points to the virus that originally led him into infectious disease research and the NIAID director role in 1984, HIV/AIDS. That work, he is quick to point out, always had bipartisan backing. In the decades since Fauci began work on HIV/AIDS, treating and preventing the virus has transformed. People live for years with HIV or can prevent transmission with daily pills and now, injections every few months. But an HIV vaccine remains elusive and, Fauci says, likely many years away.

Read more at Politico

Yellen Says U.S. Aims to Move Ahead with Global Minimum Corporate Tax – Manchin Balks

The United States will look for every opportunity to move ahead and enact a global minimum corporate tax agreement despite the opposition of a key Democratic senator, Joe Manchin, to raising corporate taxes, U.S. Treasury Secretary Janet Yellen said.

Manchin, who holds the pivotal vote in the evenly divided Senate, this week said he would not support a Democratic proposal for new climate change spending and higher taxes for corporations and wealthier Americans. His opposition could imperil passage of legislation that would commit the United States to a 15% global minimum corporate tax, a key part of an agreement that Yellen helped negotiate with nearly 140 countries last year.

Read more at Reuters

U.S. Manufacturers Strategize to Take On Inflation, Labor Shortages

Manufacturers surveyed in Umpqua Bank’s “2022 Business Barometer” cited inflation as the number-one economic concern, with 59 percent ranking it as a top challenge, while about six in 10 surveyed companies were also having difficulty finding qualified employees and 59 percent indicated that navigating supply chain issues was the most important area of their business to address for success in the coming year.

To address these challenges, manufacturers are most likely to make significant changes to their products and services and pricing models in the next year, as well as invest in digitization to become more efficient, the study revealed. Compared to other sectors, manufacturers are more focused on finding new suppliers or strengthening relationships with current suppliers and implementing new inventory management techniques to address ongoing supply chain disruption. Manufacturers are also likely to allow more remote work options, increase pay and benefits and adopt creative ways to support working parents, as attracting and retaining workforce talent poses increasing challenges to growth.

IBM Second-Quarter Earnings Advance on 9% Sales Growth, Warns on Forex and Russia

International Business Machines Corp. reported 9% sales growth in second-quarter results that also reflected some of the wider concerns tech investors confront as the sector kicks off its earnings season. Earnings per share in the second quarter rose almost 80% from the year-ago period to $1.61 a share.

IBM on Monday said revenue for the April through June period reached $15.5 billion after Chief Executive Arvind Krishna vowed to reinject growth into the business. As part of that plan, IBM spun off some of its declining operations last year. But the company also exited profitable operations in Russia after Western governments imposed sanctions on Moscow for its invasion of Ukraine, IBM Chief Financial Officer Jim Kavanaugh said Monday. The strength of the dollar also affected its results, he added. IBM shares fell more than 4% in after-hours trading.

Read more at the WSJ

Stop Giving Gen Z So Much Credit for Shaking up the Workplace. Gen X Started it 30 Years Ago

Gen Z is a puzzle everyone’s trying to figure out at work. They want it all: Purpose! Work-life balance! Flexibility! And if they don’t get it, they’ll leave the door swinging on their way out. If that narrative sounds a little tired, it’s likely because you first heard it when millennials entered the workforce 15 years ago.

Gen Z’s attitudes about work are the result of both generational identity and life stage. Yes, the pandemic accelerated desires past generations set into motion and emboldened Gen Z to speak up about them. But still, these are idealistic 20-somethings who have stars in their eyes, who are also eclipsed by economic crises. Millennials have trod this ground before. And some even argue that this workplace idealism began with Gen X 30 years ago.

Read more at Fortune

NY Fed Survey: Region’s Service Sector Declined in Early July

Activity declined in the region’s service sector, according to firms responding to the Federal Reserve Bank of New York’s July 2022 Business Leaders Survey. The survey’s headline business activity index fell thirteen points to -10.7, its first negative reading in over a year. The business climate index was little changed at -34.3, indicating that firms generally viewed the business climate as worse than normal for this time of year.

Employment growth slowed, and wage increases remained widespread. While still elevated, the prices paid and prices received indexes moved notably lower, pointing to a deceleration in price increases. Looking ahead, firms no longer expect activity to increase over the next six months, and they remained pessimistic about the expected future business climate.

Read more at the NY Fed

Airbus Forecasts Steady Growth in Commercial Aviation

Airbus has issued a 20-year forecast for the global commercial aerospace market (2022-2041), highlighted by the projection that air-traffic volumes will return to pre-pandemic (2019) levels between 2023 and 2025. That development would be followed by a growth in commercial aircraft passenger traffic at a 3.6% consolidated annual growth rate through 2041.

In numerical terms, Airbus projects that demand total of 39,500 new passenger aircraft will be delivered between 2022 and 2041. Of these, more than 2,400 will be new or converted cargo jets. Air-freight volumes will take a similar growth rate achieving a 3.2% CAGR through 2041. The 20-year outlook anticipates about 80% of these new aircraft will be narrow-body jets and about 20% will be wide-body models.

Read more at American Machinist

Farnborough Airshow to Focus on Cleaner Flying and Potential Fighter Jet Deal

Low-emission air travel and a potential deal for Japan to help build the UK’s next-generation Tempest fighter jet are set to take centre stage at the annual Farnborough airshow this week. Analysts expect hundreds of orders for new Airbus and Boeing planes during the show as airline passenger numbers bounce back, but manufacturers have emphasised efforts to reduce planes’ environmental impact, even as they expect a resurgence in sales of commercial jets using fossil fuels.

Executives from global aerospace manufacturers and airlines will gather at the airport in Hampshire after a four-year gap. The show, which begins on Monday, normally happens every two years but was cancelled in 2020 because of the coronavirus pandemic, as the aviation industry faced potential collapse.

Moody’s Economist Mark Zandi Warns Recession Could Be a Self-Fulfilling Prophecy for the U.S.

Mark Zandi, who has been an economist for more than three decades, says he’s never seen so many people convinced that a recession is imminent. And while he believes the U.S. economy can still avoid such an economic downturn, sentiment is so poor that it poses its own risk—a sort of self-fulfilling recession prophecy.

Zandi, the chief economist at Moody’s Analytics, joined the “What Goes Up” podcast to discuss his outlook after government data this week showed the highest level of inflation in almost 41 years.

Read more at Fortune

Daily Briefing – 542

Post: Jul. 17, 2022

Empire State Manufacturing Survey – Modest Growth in July, Pessimism for the Future

Manufacturing activity expanded modestly in New York State, according to the July survey. The general business conditions index climbed twelve points to 11.1. However, firms now expect activity to decline over the next six months, a sentiment only expressed three other times in the survey’s history. The index for future business conditions plunged twenty points to -6.2. The capital spending and technology spending indexes fell, but remained positive.

The new orders index was little changed at 6.2, pointing to a small increase in orders,
The shipments index surged to 25.3, indicating strong growth in shipments.
The unfilled orders index held steady at -5.2.
The delivery times index fell for a third consecutive month, declining six points to 8.7,
The inventories index was little changed at 14.8, signaling that inventories expanded.
The index for number of employees held steady at 18.0, pointing to a solid increase in employment,
The average workweek index came in at 4.3, indicating a slight increase in hours worked.
The prices paid index fell fourteen points to 64.3, and the prices received index moved down twelve points to 31.3.

Read more at the NY Fed

War in Ukraine Headlines

11.3: U.S. Producer Prices Accelerate in June, But Underlying Inflation Slowing

The producer price index for final demand climbed 1.1% last month after rising 0.9% in May, the Labor Department said on Thursday. In the 12 months through June, the PPI increased 11.3%after advancing 10.9% in May. Excluding the volatile food, energy and trade services components, producer prices rose 0.3% in June. The so-called core PPI increased 0.4% in May. In the 12 months through June, the core PPI advanced 6.4% after rising 6.7% in May.

A 2.4% rise in goods prices accounted for three quarters of the increase in the PPI. Goods prices gained 0.4% in May. Nearly 90% of last month rise in goods prices was attributed a 10.0% jump in energy prices. There were strong increases in the prices of gasoline, diesel fuel, electric power and residential natural gas. Wholesale food prices edged up 0.1%.

Read more at Reuters

US Retail Sales Top Forecast in Boost From High Inflation

Retail sales, a measure of how much consumers spent on a number of everyday goods, including cars, food and gasoline, rose 1% in June from the prior month, the Commerce Department said Friday. Economists surveyed by Refinitiv expected sales to rise 0.8%. It marked a major uptick from the decline of 0.1% in May, which was upwardly revised from the initial report of a 0.3% decline. The June advance is not adjusted for inflation, meaning that consumers may be spending the same but getting less bang for their buck. When taking inflation into consideration, retail sales would likely show a modest but steady decline in recent months.

A burst in spending at gas stations helped to propel retail sales higher: Gasoline sales climbed 3.6% in June as prices at the pump notched a record-high in mid-June, with the average gallon of gas briefly topping $5. Prices have since subsided, hovering around $4.57, according to AAA.

Read more at Bloomberg

U.S. COVID – Hospitalizations Inch Higher

The US CDC is reporting 88.8 million cumulative cases of COVID-19 and 1,017,391 deaths. The average daily incidence has essentially plateaued over the past several weeks, holding relatively steady at approximately 100-110,000 new cases per day. Both new hospital admissions (+12.0% over the past week) and current hospitalizations (+11.4%) continue to increase, despite the ongoing plateau in daily incidence. New hospitalizations among children aged 17 years and younger are approaching its second-highest peak (November 2021).

Community transmission in the US is increasingly driven by the Omicron BA.5 sublineage. BA.5 is projected to have accounted for more than half of sequenced specimens starting the week of July 2, and the estimate reached 65% for the week of July 9. The BA.4 sublineage is also increasing in prevalence, although much more slowly than BA.5. Omicron variants represent essentially all new cases in the US.

NYS Vaccine and COVID Update –

Editor’s Note: Given the small changes in vaccinations we will no longer track this information in the briefing. Instead we will provide a link to the NYS Vaccination Tracker below)

The Governor updated COVID data through July 7. There were 20 COVID related deaths for a total reported of 72,417

Hospitalizations:

Patients Currently in Hospital statewide: 2,458
Patients Currently in ICU Statewide: 237

7 Day Average Positivity Rate – Cases per 100K population

Statewide 8.99% – 36.84 positive cases per 100,00 population
Mid-Hudson: 8.55% – 31.44 positive cases per 100,00 population

Useful Websites:

One Coronavirus Infection Wards off Another — but Only if it’s a Similar Variant

Natural immunity induced by infection with SARS-CoV-2 provides a strong shield against reinfection by a pre-Omicron variant for 16 months or longer, according to a study1. This protection against catching the virus dwindles over time, but immunity triggered by previous infection also thwarts the development of severe COVID-19 symptoms — and this safeguard shows no signs of waning.

The study1, which analyses cases in the entire population of Qatar, suggests that although the world will continue to be hit by waves of SARS-CoV-2 infection, future surges will not leave hospitals overcrowded with people with COVID-19.

Consumer Sentiment Remained Near Record Lows In Early July

The preliminary July results from the University of Michigan Surveys of Consumers show overall consumer sentiment ticked up in early July but remains near record lows. The composite consumer sentiment increased to 51.1 in early July, up from the record low 50.0 in June, a rise of 1.1 points or 2.2 percent. The index is consistent with prior recessions. The current-economic-conditions index rose to 57.1 from the record-low 53.8 in June.

The second sub-index – that of consumer expectations, one of the AIER leading indicators – lost 0.2 points or 0.4 percent for the month, dropping to 47.3. The index is at its lowest level since May 1980. According to the report, “Current assessments of personal finances continued to deteriorate, reaching its lowest point since 2011.” The report goes on to add, “Buying conditions for durables adjusted upwards, owing both to consumers who cited easing supply constraints and those who believed that one should buy now to avoid future price increases, which would exacerbate inflation going forward.”

Read more at Seeking Alpha

US Chamber Met Life Index: Small Business Leaders Say Inflation is Their Top Concern

This quarter, more than two in five (44%) indicate inflation is the top challenge facing the small business community, an 11-percentage point increase from Q1 2022 and a 21-percentage point increase from Q4 2021. Supply chain issues (28%) and revenue (22%) remain in the top three, but they are now in a distant second-tier behind inflation.

Nearly nine in ten small businesses (88%) are concerned about the impact of inflation on their business, with almost half (49%) indicating they are very concerned (up from 44% in Q1 2022 and 31% in Q4 2021). The share of small businesses that report rising prices have had a significant impact on their business continues to rise—up to 80% this quarter compared to 74% in Q1 2022.

New York Urged to Pay Down Federal Unemployment Debt

Democratic state lawmakers in a letter on Monday urged Gov. Kathy Hochul’s administration to repay the $8.1 billion owed to the federal Unemployment Trust Fund before a major increase in tax costs hit New York businesses later this year. The letter, signed by 22 members of the state Assembly who represent suburban and upstate districts and released by Assemblywoman Carrie Woerner’s office, comes as New York largely remains an outlier among the states for the outstanding debt created by the economic crisis during the early months of the COVID pandemic.

“Making payments against the outstanding debt is the responsible thing to do; allowing the debt to grow through non-payment will endanger the State’s ongoing economic recovery,” the lawmakers wrote in the letter. “We urge you to take immediate action to repay the loan.” Business organizations, (including the Council of Industry) have urged New York officials to act before leaving Albany earlier this year.

Read more at State of Politics

U.S. Jobless Claims Reach Highest Level This Year

New applications for unemployment benefits edged higher last week, but still remained near historic lows, suggesting the strong labor market is cooling a bit as the economy slows. Initial jobless claims, a proxy for layoffs, rose slightly to a seasonally adjusted 244,000 last week from 235,000 the prior week, the Labor Department said Thursday. The figure stands a bit above the 2019 pre-pandemic weekly average of 218,000, when the U.S. labor market was also strong.

The four-week moving average for claims, which smooths weekly volatility, inched up to 235,750 last week, an increase of 3,250 from the previous week’s average. Continuing claims, a proxy for the total number of people receiving payments from state unemployment programs, fell by 41,000 to 1.3 million in the week ended July 2. Continuing claims are reported with a one-week lag.

Read more at the WSJ

Union Efforts, Unfair Labor Charges Spike in US

Union representation petitions filed at the National Labor Relations Board (NLRB) have gone up more than 50 percent since last year, the agency announced this week. By May, petitions already surpassed the total number of petitions filed last year. So far this year, 1,935 petitions have been submitted — 695 more than 2021, according to a statement from the agency.

Meanwhile, charges of unfair labor practices have jumped by 14.5 percent from 11,451 last year to 13,106 in the first three quarters of this fiscal year.

Read more at The Hill

China’s Economy Slows Sharply in Q2, Global Risks Darken Outlook

China’s economic growth slowed sharply in the second quarter, highlighting the colossal toll on activity from widespread COVID lockdowns and pointing to persistent pressure over coming months from a darkening global outlook.

Gross domestic product in the April-June quarter grew a tepid 0.4% from a year earlier, official data showed on Friday. That was the worst showing for the world’s second-biggest economy since the data series began in 1992, excluding a 6.9% contraction in the first quarter of 2020 due to the initial COVID shock. It also missed forecast of a 1.0% gain in a Reuters poll of analysts and marked a sharp slowdown from 4.8% growth in the first quarter.

Read more at Reuters

Senator Manchin Won’t Support Climate, Tax Measures in Economic Package

Sen. Joe Manchin (D., W.Va.), the pivotal vote in Democrats’ efforts to pass a bill aimed at fighting climate change, told Senate Majority Leader Chuck Schumer that he wouldn’t support an economic package that raises taxes or includes climate provisions, according to people familiar with the matter. “Senator Manchin believes it’s time for leaders to put political agendas aside, re-evaluate and adjust to the economic realities the country faces to avoid taking steps that add fuel to the inflation fire,” a spokeswoman for Mr. Manchin said.

Instead, Mr. Manchin told Mr. Schumer on Thursday that he would only support a bill that includes provisions aimed at lowering the price of prescription drugs and a two-year extension of Affordable Care Act subsidies, according to one of the people. The Senator’s decision comes after figures released by the government show inflation at a 41 year high.

Read more at the WSJ

Senate Plans Vote Focused on Semiconductor Portion of China Bill

Senate Majority Leader Chuck Schumer (D., N.Y.) is telling colleagues to expect a floor vote as early as Tuesday on a stripped-down China competition bill that would include more than $50 billion and investment tax credits to encourage semiconductor production in the U.S. but exclude other provisions.

The decision to hold the vote comes after a briefing from administration officials Wednesday pushing lawmakers to pass semiconductor funding as negotiations over a larger competition bill have stalled, and it remained uncertain whether Republicans would allow a slimmed-down bill to advance in the evenly divided Senate. Republicans have demanded that Democrats end their efforts to pass a partisan prescription-drug and climate bill as a condition for moving the China legislation.

Global Oil-Supply

Daily Briefing – 541

Post: Jul. 13, 2022

9.1% – Inflation Rose Even More Than Expected in June, as Consumer Pressures Intensify

The consumer price index, a broad measure of everyday goods and services related to the cost of living, soared 9.1% from a year ago, above the 8.8% Dow Jones estimate. That marked the fastest pace for inflation going back to November 1981. Excluding volatile food and energy prices, so-called core CPI increased 5.9%, compared with the 5.7% estimate. Core inflation peaked at 6.5% in March and has been nudging down since.

On a monthly basis, headline CPI rose 1.3% and core CPI was up 0.7%, compared to respective estimates of 1.1% and 0.5%.
Energy prices surged 7.5% on the month and were up 41.6% on a 12-month basis.
The food index increased 1%,
Shelter costs, which make up about one-third of the CPI rose 0.6% for the month and were up 5.6% annually.
Rental costs rose 0.8% in June, the largest monthly increase since April 1986, according to the BLS.

Read more at CNBC

War in Ukraine Headlines

An Omicron Vaccine is Coming. Should You Wait for it—Or Get Your Next Booster Now Amid BA.5’s Surge?

With Omicron-specific vaccines perhaps only months away, Americans may be weighing whether to hold out for those doses or receive their first or second booster now. “It would depend on a person’s underlying health condition,” says Siddharth Sridhar, clinical assistant professor at the University of Hong Kong’s department of microbiology. “People with medical conditions that put them at risk of severe COVID should get the existing vaccine as a second booster.”

For months now, experts have advised vaccine recipients, especially those with underlying health conditions, to receive the doses they’re eligible for as soon as possible rather than consider other factors, like vaccine brand or current COVID case counts. Some experts argue that the calculus is different for younger and healthier people. In the U.S., Americans under 50 without compromised immune systems don’t yet qualify for a second booster. And this pool of people is already well protected from severe disease so long as they received their first booster.

Read more at Fortune

Yield Curve Inversion Between 10-Year and 2-Year Rates Reaches Biggest Point Since 2000

The 2-year Treasury yield popped Wednesday while its 10-year counterpart fell, pushing the so-called inversion between the two to its biggest level since 2000. The 2-year, which is more sensitive to changes in monetary policy, traded 9 basis points higher at around 3.13%. The benchmark 10-year rate, meanwhile, slid nearly 5 basis points to 2.91%. Yields move inversely to prices, and a basis point is equal to 0.01%.

Yield-curve inversions are seen by many on Wall Street as signals that a recession lies on the horizon. Earlier on Wednesday, Bank of America economists said in a note that they expect the U.S. to enter a “mild recession” this year. They noted that incoming data points to slowing momentum for the economy and that inflation seems to be hindering consumer spending.

Read more at CNBC

U.S. COVID – Hopes of Covid-19 Reprieve Fade as BA.5 Subvariant Takes Over

Covid-19 is circulating widely as the BA.5 Omicron subvariant elevates the risk of reinfections and rising case counts, spoiling chances for a summer reprieve from the pandemic across much of the U.S.

Covid-19 levels are high in a fifth of U.S. counties, according to the Centers for Disease Control and Prevention’s metric based on case and hospital data, a share that has been mostly rising since mid-April. BA.5 is estimated to represent nearly two in three recent U.S. cases that are averaging just more than 100,000 a day, CDC data show. The true number of infections may be roughly six times as high, some virus experts said, in part because so many people are using at-home tests that state health departments largely don’t track.

Read more at the WSJ

NYS Vaccine and COVID Update –

Editor’s Note: Given the small changes in vaccinations we will no longer track this information in the briefing. Instead we will provide a link to the NYS Vaccination Tracker below)

The Governor updated COVID data through July 7. There were 15 COVID related deaths for a total reported of 72,218

Hospitalizations:

Patients Currently in Hospital statewide: 2,255
Patients Currently in ICU Statewide: 209

7 Day Average Positivity Rate – Cases per 100K population

Statewide 8.89% – 28.30 positive cases per 100,00 population
Mid-Hudson: 8.39% – 29.39 positive cases per 100,00 population

Useful Websites:

Citing Risk from Omicron Variant BA.5, White House Urges Americans to Get Covid-19 Boosters

The Biden administration urged the public to strengthen their protections against Covid-19, noting that the BA.5 subvariant of Omicron has become the dominant strain in the country. At a briefing Tuesday, health officials outlined their plan to combat the latest form of the coronavirus to pose a threat, emphasizing existing tools like vaccines and boosters, testing, and treatments. Health officials sought to convey they were on top of BA.5, while underscoring the risks it posed.

“BA.5 is something we’re closely monitoring, and most importantly, we know how to manage it,” said Ashish Jha, the White House’s Covid-19 response coordinator. The latest estimates indicate BA.5 is now responsible for about 65% of U.S. Covid-19 cases, while its closely related cousin, BA.4, is accounting for about 16% of infections, said Rochelle Walensky, the director of the Centers for Disease Control and Prevention.

Freight Rates Trending Down

High-price freight contracts that were written when carrier capacity was tight and a rush to restock inventories was in full force are losing their shine as slowing demand and a wavering U.S. economy send shipping rates sliding. Some companies now are renegotiating shipping agreements they struck at the height of the pandemic-driven surge in freight demand or are dipping into the spot market to take advantage of lower rates.

The reduction in transportation costs is good news for manufacturers and retailers after two years of rapidly rising expenses. It also suggests the contribution of the freight sector to inflation is at least leveling off. But shippers note they are still paying several times more than they did before the Covid-19 pandemic snarled supply chains world-wide.

Read more at the WSJ

Biden Closes in on China Tariffs Decision

President Biden is contending with competing political and policy pressures as he closes in on a decision on whether to lift Trump-era tariffs on Chinese imports. On one hand, it’s one of the only options at Biden’s disposal to try to lower the price of everyday goods that are subject to tariffs of up to 25 percent. But axing tariffs would have a minimal impact on inflation, experts say.

The U.S. is conducting its four-year review of the Section 301 tariffs placed on furniture, footwear, sunscreen, appliances, bicycles and other consumer goods, and officials have indicated the White House will announce its decision soon. Experts expect Biden to lift or reduce tariffs on a relatively tiny fraction of imports: as little as $10 billion worth of Chinese products out of the roughly $350 billion in goods slapped with tariffs by former President Trump.

Read more at The Hill

The 20 Counties That Will Decide the Midterms – One is in the Hudson Valley

The U.S. has more than 3,000 counties, but with its population increasingly sorting into solidly blue or comfortably red territory, the number of truly contested regions is just a tiny fraction of that total. These are 20 of the most important counties – including Dutchess County – that will determine whether Republicans or Democrats rule the House and Senate in 2023.

Biden Heads to the Middle East – 5 Things to Watch

For decades American presidents have arrived in the Holy Land like earnest pilgrims searching for the holy grail of a two-state solution. George Bush hoped to find it in 2003 with his “road map for peace”. Barack Obama came in 2013, Donald Trump promised to “give it an absolute go”. Joe Biden has lost the faith. His nearly 48-hour visit to Israel and Palestine, which begins on July 13th, will be an exercise in banality: shake a few hands, see a few sights, head back to the airport.

The focus of Mr Biden’s trip begins on July 15th, when he lands in Jeddah, the first American president to fly to Saudi Arabia from Israel. Even Israelis acknowledge that they are a warm-up act. The trip’s most fraught moment may be an expected encounter with Muhammad bin Salman, the Saudi crown prince, a bête noire for many Democrats because of his dismal human-rights record. Mr Biden has refused to talk to him since he took office. But now….

Read more at The Hill

Oil Prices Could Spike ‘Well Over $150’ a Barrel: Energy Analyst Says

The national average for a gallon of gas fell to $4.66 on Tuesday, dropping thirty-four cents since May 2022. However, some analysts believe that the recent relief in oil prices is only temporary. “I think a lot of this, especially for oil, is going to go back to Russia. And I think you are going to see supply upended, if not at the end of the year, if not before. I think that has the potential to cause oil prices to even spike higher than what we just saw a couple months ago,” Neal Dingmann, Truist’s managing director of energy research, told Yahoo.

Dingmann predicted gas prices could rise “potentially 50%” if the U.S. doesn’t have an alternate source for Russian oil. In 2021, Russia and Saudi Arabia were the top petroleum importers for the U.S. The nations supplied 8% and 5% of the total market’s natural gas across the 50 states.

Read more at YahooFinance

Happy Bastille Day – Microchip Shortages Hit Renault Sales

French carmaker Renault said Tuesday that sales of its conventional and electrical vehicles fell in the first half of this year, impacted by the worldwide shortage of semiconductors. It said it sold 1,000,199 units in the first half of 2022, down 12% compared to the same period last year. The data for both years did not include sales in Russia.

Renault said the dip in sales comes “in a context disrupted by the semiconductor crisis and marked by the shutdown of the group’s activities in Russia”. The global shortage of such parts has forced carmakers around the world to throttle and even halt production temporarily.

Read more at IndustryWeek

After a Turbocharged Boom, are Chipmakers in for a Supersized Bust?

Last year the chip industry’s revenues grew by a quarter to $580bn, according to idc, a research firm. Chipmakers’ market values soared. With demand expected to grow ever more insatiable, the time-honoured semiconductor cycle—the consequence of the lag between demand and new supply, which takes a year or two to build up—appeared to be a thing of the past, prompting chip firms to spend like there was no tomorrow. TSMC and its two main rivals, America’s Intel and Samsung of South Korea, invested $92bn between them last year, a rise of 73% relative to 2019—and pledged a further $210bn or so all told over the next two years.

Now it seems that far from being banished, the chip cycle may instead have sped up. Chips of all sorts are looking wobbly. This month Samsung said that operating profit would stall this quarter, following three quarters of record-breaking sales figures. It is reportedly considering dropping prices for memory chips in the second half of 2022. TrendForce, a research firm, expects memory prices to fall by a tenth in the next three months. By one estimate, prices of graphics chips have dropped by half since January, as the cryptosphere implodes and gamers spend more time in non-virtual reality.

Read more at The Economist

Global Oil-Supply Crisis Shows Signs of Easing, IEA Says

The worst oil-supply crisis in decades is showing tentative signs of easing as flagging economic growth weighs on demand for crude while sanctions on Russia are having less impact on oil production than expected, the International Energy Agency said Wednesday. The Paris-based agency cut its forecasts for oil demand for this year and next.

Meanwhile, U.S. and Canadian producers were leading an increase in global output, while sanctions on Russia’s oil industry were having less of an effect on its production levels than initially expected.

Read more at the WSJ

Daily Briefing – 540

Post: Jul. 12, 2022

Pattern For Progress: IRS Data Show Hudson Valley Saw Net Gain from Migration for First Time in More Than a Decade

Pattern for Progress yesterday released a special report that analyzes the migration of people into the Hudson Valley, and out of the region, during the first year of the Covid-19 pandemic. Data show that the Hudson Valley experienced a net gain from migration for the first time in more than a decade, including a net gain of 33,394 residents from the five boroughs of New York City. A total of 48,642 people from the five boroughs of New York City moved into the Hudson Valley, and 15,248 moved out of the region and into the city, for a net gain of 33,394 people in the Hudson Valley.

The data show a north-south divide across the region. Counties in the lower Hudson Valley (Westchester, Rockland, Orange) lost population due to migration, while counties to the north showed net gains in population. Conclusions are hard to draw because these data include migration before and during the pandemic, but the divide could indicate a movement away from densely populated areas into smaller cities, villages, and rural towns. This trend was well documented in real estate data that showed people leaving high-population areas because they feared that density put them at a greater risk of contracting the novel coronavirus.

Read the report at the Pattern website

War in Ukraine Headlines

Hochul Not Anticipating New Restrictions Despite Rising COVID Cases

Gov. Kathy Hochul said she continues to track New York’s COVID-19 infection and hospitalization numbers daily and while cases are trending up, it doesn’t appear the current sub-variant of the virus is causing as serious illness as previous ones. “We’re not looking at more restrictions right now because this time around, we have readily available vaccinations. Anybody can get a booster shot,” Hochul said. “If you’re over 50, you can get a double booster, which I’ve had, as well as the test kits are so widely available.”

Hochul said the administration reserves the right to consider new policies if the situation worsens, but she doesn’t anticipate any business or other restrictions in the near future. “This is going to be more endemic,” she said. “People are getting used to living with it.”

NASA Unveils More of Webb Space Telescope’s First Full-Color Images

Following a presidential sneak peek of a galaxy-studded image from deep in the cosmos, NASA on Tuesday unveiled more of its initial showcase from the James Webb Space Telescope, the largest and most powerful orbital observatory ever launched. The first batch of full-color, high-resolution pictures, which took weeks to render from raw telescope data, were selected by NASA to provide compelling early images from Webb’s major areas of inquiry and a preview of science missions ahead.

The $9 billion infrared telescope, built for NASA by aerospace giant Northrop Grumman Corp , is expected to revolutionize astronomy by allowing scientists to peer farther than before and with greater clarity into the cosmos, to the dawn of the known universe.

See the images at Fox News

U.S. COVID – Biden Administration To Again Extend The Covid Public-Health Emergency

The US government will once again extend the Covid-19 public health emergency, continuing measures that have given millions of Americans special access to health insurance and telehealth services. The Department of Health and Human Services has repeatedly renewed the emergency since it was originally declared in January 2020, with the most recent extension set to expire July 15. The next extension is expected to take effect Friday, according to a person familiar with the matter who asked not to be identified because the details aren’t public.

The emergency designation has given millions of Americans special access to Medicaid. US regulators have also used emergency powers to clear vaccines, therapeutics and diagnostics for use against the coronavirus. The designation has also allowed for flexibilities around virtual health services. Lawmakers have pledged to extend increased telehealth access until five months after the end of the public health emergency is declared. An abrupt end to the emergency declaration could affect companies that provide those services.

NYS Vaccine and COVID Update –

Editor’s Note: Given the small changes in vaccinations we will no longer track this information in the briefing. Instead we will provide a link to the NYS Vaccination Tracker below)

The Governor updated COVID data through July 7. There were 15 COVID related deaths for a total reported of 72,218

Hospitalizations:

Patients Currently in Hospital statewide: 2,255
Patients Currently in ICU Statewide: 209

7 Day Average Positivity Rate – Cases per 100K population

Statewide 8.89% – 28.30 positive cases per 100,00 population
Mid-Hudson: 8.39% – 29.39 positive cases per 100,00 population

Useful Websites:

New Coronavirus Mutant Raises Concerns in India and Beyond

The quickly changing coronavirus has spawned yet another super contagious omicron mutant that’s worrying scientists as it gains ground in India and pops up in numerous other countries, including the United States. Scientists say the variant – called BA.2.75 – may be able to spread rapidly and get around immunity from vaccines and previous infection. It’s unclear whether it could cause more serious disease than other omicron variants, including the globally prominent BA.5.

“It’s still really early on for us to draw too many conclusions,” said Matthew Binnicker, director of clinical virology at the Mayo Clinic in Rochester, Minnesota. “But it does look like, especially in India, the rates of transmission are showing kind of that exponential increase.” Whether it will outcompete BA.5, he said, is yet to be determined.

Moderna to Advance two Omicron Vaccine Candidates Against Newer Variants

Moderna Inc (MRNA.O) said on Monday it was advancing two Omicron vaccine candidates for the fall, one designed against the BA.1 variant and another against the BA.4 and BA.5. Moderna said its decision to develop the bivalent vaccines was based on different market preferences for shots against the subvariants.

Vaccine makers including Moderna and rival Pfizer Inc are developing updated vaccines to target the fast-spreading Omicron subvariants BA.4 and BA.5, which have gained a foothold in the United States over recent weeks.

Read more at Reuters

Judge Declares COVID-19 Isolation, Quarantine Regulations Void

In a case brought by three Republican state legislators, state Supreme Court Justice Ronald Ploetz of Cattaraugus County shut down Rule 2.13, which states that “whenever appropriate to control the spread of a highly contagious communicable disease,” the state health commissioner may issue and/or direct local health officials “to issue isolation and/or quarantine orders, consistent with due process of law, to all such persons as the State Commissioner of Health shall determine appropriate.”

In his opinion, Ploetz said the rule — enacted in February — gave only “lip service” to constitutional due process; he declared it to be in violation of state law, and therefore null, void and unenforceable. The decision could impact the management of future health crises.

Euro Teeters on the Brink of Parity With the U.S. Dollar on Recession Fears

The euro hovered close to parity with the U.S. dollar on Tuesday, as the euro zone’s energy supply crisis and economic woes continue to depress the common currency. The euro was trading 0.2% lower at around $1.002 during morning deals in London, paring earlier losses that pushed the single currency to the brink of parity with the dollar.

Fears of a recession have grown in recent weeks due to rising uncertainty over the bloc’s energy supply, with Russia threatening to further reduce gas flows to Germany and the broader continent.

Read more at CNBC

Yellen Sees Yen’s Depreciation, Says Intervention Only Warranted in ‘Rare’ Cases

U.S. Treasury Secretary Janet Yellen on Tuesday acknowledged the Japanese yen’s substantial depreciation in recent weeks, but said the U.S. view remained that currency intervention was warranted only in “rare and exceptional circumstances.” Yellen told reporters that Washington remained convinced that countries such as Japan, the United States and other members of the Group of Seven rich nations should have market-determined exchange rates and intervention was warranted “only in rare and exceptional circumstances.”

Yellen noted that Japan continued to have “yield curve control and zero interest rate policy” at a time when the Federal Reserve was tightening monetary policy. As a result, interest rate differentials – which tended to systematically strengthen the dollar and weaken other currencies – had become “quite large,” she said, although the yen’s losses had outstripped what one might expect based on the gap.

Texas Grid Operator Tells Residents to Curb Power as Heat Hits Record Highs

Texas’ grid operator is warning residents to conserve energy for the second time this year, as fears mount over potential rolling blackouts amid scorching temperatures this week. The Electric Reliability Council of Texas, which manages about 90% of the state’s electricity load, said that residents and businesses should turn up thermostats by at least one degree Fahrenheit and not use any major appliances between 2 p.m. and 8 p.m. Central time on Monday.

The Texas regulator also projected a shortage in energy reserves on Monday “with no market solution available,” but said it does not expect systemwide outages. Less than 10% of wind power generation will be available on Monday, ERCOT said, further lowering the amount of available power in the state.

Read more at CNBC

Late COVID Test Results Lead to Refunds for Hundreds of New Yorkers

Hundreds of New Yorkers were able to get refunds for COVID-19 tests late last year that promised 24-hour turnaround times for results and failed to deliver. Attorney General Letitia James’ office last week announced 692 people were able to receive more than $122,000 who had paid for the expedited results but did not receive them.

The refunds came following an investigation by James’ office, which has also called on COVID testing companies that have claimed to be able to provide 24-hour results to amend their advertising. The funds were paid by COVID testing company Clear 19. Two other COVID testing companies, ClearMD Health and SameDay Health, had previously refunded hundreds of thousands of dollars after failing to deliver on the promise of quick results.

Read more at State of Politics

Daimler, Volvo and Traton Team Up To Build Electric Vehicle Infrastructure

The three large commercial vehicle OEMs are otherwise competitors, but a collaboration on a large European electric-vehicle charging network among truck manufacturers Daimler Truck, Volvo Group, and Volkswagen truck and bus subsidiary Traton Group was finalized last week—and it joins private and public infrastructure efforts in the U.S. that eventually will be necessary to support widespread electric trucking adoption in America.

The three OEMs completed the final step July 8 in forming the joint venture for charging infrastructure in Europe, which had been announced previously. The venture, with charging network veteran Anja van Niersen appointed as CEO, is expected to play a significant role in supporting the European Union’s Green Deal for carbon-neutral freight transportation by 2050, according to a release from the three trucking OEMs.

Court Pick a ‘Pivotal Moment’ for Hochul to Reshape New York Judiciary

The surprise resignation Monday of New York’s top judge led to a groundswell of calls from Democratic state and federal lawmakers to reshape the court and move it in a more progressive direction in response to the conservative shift on the U.S. Supreme Court.

Democrats in New York said the pick for the Court of Appeals in the coming months needs to counteract the Supreme Court’s recent decisions to overturn Roe v. Wade and toss a restrictive concealed carry gun law that the state had on the books for a century. The replacement will also be a chance for Hochul to address concerns that the court had close ties to Cuomo, particularly DiFiore who maintained a friendship with Cuomo during their years living in Westchester County. He picked her as chief judge in 2016.

Read more at Politico

Boeing Deliveries Reach Highest Monthly Level Since March 2019

Boeing Co delivered 51 airplanes in June to bring its first-half tally to 216 jets, up 38% from the same period last year, pushing its shares sharply higher on Tuesday. June’s deliveries exceeded the 50 threshold for the first time since March 2019 and included 43 Boeing 737 MAX, which is recovering from a nearly two-year safety crisis, according to new company data.

Boeing’s shares rose more than 8% as it also confirmed that monthly MAX production had touched a target of 31 airplanes, while cautioning it had yet to be “stabilised” at that level as aerospace faces worldwide supply chain snags.

Read more at Reuters

Daily Briefing – 539

Post: Jul. 11, 2022

Schumer Making Last-Ditch Bid to Pass Reconciliation Bill this Summer

Schumer and centrist Sen. Joe Manchin (D-W.Va.) have made progress on proposals to lower the cost of prescription drugs, extend Medicare’s solvency and raise taxes on some high-income earners. Manchin and Schumer have worked out a proposal to impose a 3.8 percent tax on individuals earning more than $400,000 and couples earning more than $500,000 from pass-through businesses and will give the legislative language to the Senate parliamentarian to review.

The $203 billion raised would extend the solvency of Medicare’s hospital fund from 2028 to 2031. But a Manchin aide waved off speculation that Schumer and Manchin are close to a deal on a broader reconciliation package that would include bold proposals to tackle global warming, a top priority of Sen. Sheldon Whitehouse (D-R.I.) and other Senate Democrats.

Read more at The Hill

War in Ukraine Headlines

Met Life/US Chamber Index Reaches Pandemic-Era High, but Inflation Concerns Dominate

The survey—conducted between April 29-May 17, 2022—found that inflation and related concerns are dominating small business leaders’ thinking as COVID concerns start to fade. Forty-four percent of the small businesses surveyed cite inflation as the biggest challenge facing small business owners, up from 33% last quarter. This is up significantly from 19% when the question was first asked in Q3 2021. Furthermore, nearly nine in ten (88%) are concerned about the impact of inflation on their business.

In contrast, concerns about the impacts of COVID-19 are fading in comparison to those over economic headwinds. A strong majority (68%) of small businesses still report continued concern over the impact of COVID-19 on their business. However, when forced to choose the most pressing challenges facing the small business community, the virus falls to a third-tier concern, behind financial challenges like inflation, supply chain issues, and revenue.

Global Semiconductor Sales Increase 18.0% Year-to-Year, 1.8% Month-to-Month in May

he Semiconductor Industry Association (SIA) today announced global semiconductor industry sales were $51.8 billion in the month of May 2022, an increase of 18.0% over the May 2021 total of $43.9 billion and 1.8% more than the April 2022 total of $50.9 billion. Monthly sales are compiled by the World Semiconductor Trade Statistics (WSTS) organization and represent a three-month moving average.

Sales were up compared to April 2021 in the Americas (36.9%), Japan (19.8%), Europe (16.1%), Asia Pacific/All Other (15.8%), and China (9.1%). Month-to-month sales increased in Japan (3.9%), the Americas (2.9%), China (1.7%), and Asia Pacific/All Other (1.1%), but fell slightly in Europe (-0.7%).

U.S. COVID – Undercounted Covid-19 Cases Leave US With a Blind Spot as BA.5 Variant Becomes Dominant

Official Covid-19 case metrics severely undercount the true number of infections, leaving the United States with a critical blind spot as the most transmissible coronavirus variant yet takes hold. The share of cases that are officially reported is at an “all-time low,” said Dr. Michael Mina, an epidemiologist and chief science officer at telehealth company eMed. “There’s no doubt about that.”
Covid-19 cases have been undercounted to some degree throughout the pandemic for reasons including a lack of available tests at some points and asymptomatic cases that may have been missed. But as people increasingly rely on rapid at-home tests — and as attitudes toward the pandemic shift overall — the US hasn’t landed on a reliable way to track transmission levels.

NYS Vaccine and COVID Update –

Editor’s Note: Given the small changes in vaccinations we will no longer track this information in the briefing. Instead we will provide a link to the NYS Vaccination Tracker below)

The Governor updated COVID data through July 7. There were 15 COVID related deaths for a total reported of 72,218

Hospitalizations:

Patients Currently in Hospital statewide: 2,255
Patients Currently in ICU Statewide: 209

7 Day Average Positivity Rate – Cases per 100K population

Statewide 8.89% – 28.30 positive cases per 100,00 population
Mid-Hudson: 8.39% – 29.39 positive cases per 100,00 population

Useful Websites:

Price of Copper Drops as China COVID Worries Dull Demand Outlook

Copper prices fell on Monday, as new COVID-19 restrictions in top consumer China and fears of rapid interest rate hikes leading to a global economic slowdown dent demand for metals. Copper, used in power and construction and often seen as a gauge for the global economic health, hit its lowest level since November 2020 last week.

Three-month copper on the London Metal Exchange CMCU3 dropped 2.5% to $7,614.50 a tonne by 0544 GMT.

Administration Weighs Options for Alaska Oil Drilling Project

The administration released an environmental review of the “Willow Project” that said that at its peak, the project could produce a total of 629 million barrels overall over the course of a 30-year duration. It found that the project could contribute between 278 million and nearly 287 million metric tons of carbon dioxide to climate change over the same time period. The document’s release comes after a court tossed the Trump-era approval of the project last year. A judge ruled that the analysis behind that approval was flawed for environmental reasons, including a lack of consideration of climate impacts. The judge ordered the Biden administration to redo it.

The latest analysis comes as the Biden administration is in a tight political spot. The president is seeking to both energize the environmentalist base ahead of the midterms, and deal with the optics surrounding high gasoline prices. It has similarly punted in terms of the future of offshore drilling, recently proposing between zero and 11 offshore lease sales between 2023 and 2028.

Read more at The Hill

Energy and Inflation: 5 Things You Need to Know Now

According to GasBuddy.com, Americans are now spending $730 million more every day on gasoline than a year ago. But the impacts of energy prices on inflation go well beyond the price we see at the pump—higher costs for oil and natural gas ripple through the economy in countless but less obvious ways.

High diesel prices are flowing through to countless goods and services.
Electricity prices are also on the rise, but impacts vary significantly by region.
High natural gas prices are impacting manufacturing, especially for energy intensive goods.
The global energy crisis is hurting Europe even more.
Relief may be on the horizon. There is an adage in commodity markets: the cure for high prices is high prices—meaning that price signals drive responses in both production and demand.

Soaring Energy Costs Begin to Hobble US Manufacturing

Soaring energy costs are beginning to exert a painful bite in US manufacturing, tempering the outlook for a manufacturing boom due to reshoring efforts. Aluminum and steel makers are among those suffering most due to their high energy usage, and more broadly a pullback is evident in three straight months of declining overtime hours and a drop in new orders last month.

Read more at Bloomberg

UN Global Hunger Report Figures Are Staggering: 150 Million Added Post COVID

Ukraine, the United Nations Development Program estimates that 51.6 million more people fell into poverty in the first three months after the war in Ukraine began, living off $1.90 a day or less. This pushed the total number globally at this threshold to 9% of the world’s population. An additional 20 million people slipped to the poverty line of $3.20 a day.

In low-income countries, families spend 42% of their household incomes on food but as Western nations moved to sanction Russia, the price of fuel and staple food items like wheat, sugar and cooking oil soared. Ukraine’s blocked ports and its inability to export grains to low-income countries further drove up prices, pushing tens of millions quickly into poverty.

Read more at the AP

Flight cancellations loom large over summer travel season

Airlines endured a better-than-expected Fourth of July holiday weekend, but staffing shortages and other root causes of flight disruptions continue to loom large over the busy summer travel season. U.S. carriers canceled roughly 1,400 flights between Friday and Monday, according to data from flight analytics firm masFlight.

The data indicates that Independence Day wasn’t a total meltdown as some predicted, but U.S. airlines still canceled more than 18,000 flights over the last calendar month, or 3 percent of flights. Carriers reduced their flight schedules by about 15 percent from June to August to reduce disruptions, but they say they still don’t have enough workers to handle the summer travel boom.

Read more at The Hill

Court Begins Redrawing Process for Assembly District Lines in 2024

After an appellate court invalidated legislative lines for the New York Assembly districts last month, a lower court is moving forward with drawing new ones for 2024 elections. But the judge overseeing the matter hasn’t decided on an exact process for doing so. In an order last week, Judge Laurence Love instructed the lawyers who brought the original case challenging the Assembly lines to provide briefs to the court on how to proceed with the process.

“One option available to the court is a special master like as was done in the other redistricting matter,” Aaron Foldenauer, an attorney for one of the petitioners said. In the same order, the judge cited a section of law suggesting the court may consider trying to revive the state’s Independent Redistricting Commission (IRC).

Tyson Foods Works to Fix Its Chicken Operations as Orders Pile Up

Tyson Chief Executive Donnie King said he is committed to fixing the nation’s largest chicken operation, which produces roughly one-fifth of the U.S. supply. The effort now faces a test, as profits from Tyson’s beef business are projected to decline this year from record levels, while the company has committed millions of dollars to expand its chicken production.

The Arkansas-based company has struggled for years to meet demand and turn a consistent profit in its poultry business. The problems have persisted through a succession of chief executives, with five different CEOs leading the company in as many years. Tyson’s challenges have played out across its sprawling operations, from problems hatching enough of the tens of thousands of chicks scampering inside cavernous barns that dot the Arkansas countryside near Tyson’s headquarters, to short-handed processing lines in the plants that slaughter and process the birds into chicken breasts or wings.

Read more at the WSJ

Riamondo: ‘I Don’t Think We Should be Talking Ourselves into a Recession,’

Commerce Secretary Gina Raimondo on Sunday said the U.S. can stave off a recession, despite concerns that the Federal Reserve’s tightening of interest rates to combat inflation could spur an economic downturn. In an interview on ABC’s “This Week,” Raimondo cast doubt on the possibility of “a serious recession,” though she predicted high economic growth from the depths of the pandemic would likely cool to “a more steady growth.”

“I do think at some point, you know, we will see a less rapid growth in the economy, but I don’t see any reason to think that we will have a serious recession,” Raimondo said. “We recovered all the jobs since the pandemic. People’s household balance sheets are strong. Companies are doing well. Companies are hiring. Companies are growing.”

Read more at Politico

Daily Briefing – 538

Post: Jul. 10, 2022

Manufacturing Achieves Pre-Pandemic Employment Levels After Months of Incremental Gains

Manufacturing companies in the U.S. added 29,000 jobs last month, slightly beating the sector’s last pre-pandemic employment numbers in February 2020. Nondurable goods manufacturing companies notably added more workers than the larger durable goods sector last month. Durable goods companies, which now employ about 7.9 million people, added 11,000 jobs in July; Nondurable goods industries added 18,000 more workers to its total pool of 4.8 million people.

U.S. manufacturing companies currently employ, according to the latest, preliminary numbers, about 12,797,000 people. That’s about 2,000 more people than the 12,795,000 who worked in manufacturing as of February 2020 before employment in the industry started its nosedive by losing 48,000 manufacturing workers in March.

Read more at IndustryWeek

War in Ukraine Headlines

Goods Exports Lead Way as US Trade Gap Narrows

The U.S. trade deficit narrowed in May as slowing domestic demand amid rising interest rates curbed imports, which could see trade contributing to economic growth in the second quarter after being a drag for nearly two years. The Commerce Department said on Thursday that the trade deficit declined 1.3% to $85.5 billion. Imports of goods and services rose 0.6%, which was offset by a 1.2% increase in exports to a record high.

Imports of goods rose 0.1%, while services scaled a record high. Goods exports shot up 1.7% to an all-time. Exports of services were also the highest on record. A record trade deficit weighed on the economy in the first quarter, resulting in gross domestic product declining at a 1.6% annualized rate. Trade has subtracted from GDP for seven straight quarters.

Read more at Reuters

372,000: June Jobs Number Higher Than Expected – Points to Continued Inflation

Hiring in June was near monthly gains logged earlier in the year, the Labor Department on Friday said. Companies added an average of nearly 400,000 workers over the previous three months, keeping the job market on strong footing. The unemployment rate, at 3.6%, was near the half-century low reached before the pandemic hit in spring 2020. Employers hired across industries, with government the only major category to shed jobs.

Many economists expect job growth will slow but say it isn’t clear whether companies will broadly cut jobs as economic output weakens, which is the typical recessionary dynamic. With too few workers for all the available jobs, companies have been reluctant to let go of the workers they have. Jobless claims, a proxy for layoffs, have ticked up in recent months but remain historically low.

Read more at the WSJ

U.S. COVID – Americans Reflect on Nation’s COVID-19 Response

A Pew Research Center survey of 10,282 U.S. adults conducted from May 2 to 8, 2022, finds 62% of Americans say the country has given too little priority to meeting the educational needs of K-12 students during its response to the coronavirus outbreak; far fewer (31%) say this has received about the right amount of priority since the outbreak first began in February of 2020.

The overall findings reflect two competing critiques of the nation’s response. One, widely expressed among Republicans, is that the country has not focused enough on business concerns and respecting individual choices. The other, more widely held by Democrats, centers concern around efforts to protect public health and limit health risks for vulnerable populations.

NYS Vaccine and COVID Update –

Editor’s Note: Given the small changes in vaccinations we will no longer track this information in the briefing. Instead we will provide a link to the NYS Vaccination Tracker below)

The Governor updated COVID data through July 7. There were 15 COVID related deaths for a total reported of 72,218

Hospitalizations:

Patients Currently in Hospital statewide: 2,255
Patients Currently in ICU Statewide: 209

7 Day Average Positivity Rate – Cases per 100K population

Statewide 8.89% – 28.30 positive cases per 100,00 population
Mid-Hudson: 8.39% – 29.39 positive cases per 100,00 population

Useful Websites:

New COVID Vaccine Developed by University of Washington Scientists

A COVID-19 vaccine developed by UW Medicine researchers has been approved in Korea, becoming the first COVID therapeutic technology from the Seattle health care system to be greenlighted for patient use.

UW Medicine scientists who worked on the technology behind the vaccine say their version is a “second-generation” COVID immunization that’s protein-based — different from the mRNA vaccines developed by Pfizer and Moderna. As a result, the vaccine, trademarked as SKYCovione, is effective in low doses, simple to manufacture and stable without deep freezing, said Neil King and David Veesler, both UW Medicine biochemistry professors and vaccine co-developers. Several donors, including the Bill & Melinda Gates Foundation, National Institutes of Health and Pew Charitable Trust, among others, also helped fund the vaccine development.

Mastercard: U.S. Retail Sales in June Reflect Rising Prices for Essentials, Continued Leisure Spending

According to Mastercard SpendingPulseTM, which measures in-store and online retail sales across all forms of payment, U.S. consumer retail spending excluding automotive increased +9.5% year-over-year (YOY) in June, while retail sales excluding auto and gas rose +6.1% YOY. Rising prices—particularly for necessities such as food and fuel—were a contributing factor, as Mastercard SpendingPulse reflects nominal spending and is not adjusted for inflation.

As inflation persists, consumers are paying more for essentials. Two of the categories that have higher inflation have seen a lift in sales: June sales for Fuel & Convenience are up +42.1% YOY and Grocery +14% YOY. Meanwhile, discretionary spending continued to drive growth across the fashion-forward sectors in June, including Jewelry +16.2% YOY, Luxury +4% and Department Stores +8.6% YOY. And with summer in full swing, consumers continue to spend on travel experiences: Airline and Lodging are both up +18.2% YOY and +33.7% YOY, respectively.

Report: Cuomo Office ‘Overpowered’ Ethics Watchdogs in Book Approval

The report provides a window into the approval process by the commission’s staff for Cuomo’s memoir about the pandemic, which became the focus of several investigations that carried over after he left office, and the strong-armed tactics that were alleged to have been used. A spokesman for the former governor asserted in a statement once again no wrongdoing was committed.

The report found, however, the commission, known commonly as JCOPE, was pushed aggressively by Cuomo’s office in winning sign off for the lucrative deal. Ethics watchdogs, meanwhile, failed to recognize the potential “moral quandary” created by the approval and failed to serve as an effective watchdog, the report found. “Rather than JCOPE telling the Executive Chamber what information it needed to provide in order to obtain approval, the Executive Chamber told JCOPE what information the Governor would provide, which was not much.”

Read more at State of Politics

Recruiting, Overtime and Onboarding Costs are Also Affecting the Bottom Line

While 89% of U.S. manufacturers, surveyed by The Workforce Institute at UKG in their report “Is Stability in Sight?” reported year-over-year growth in April 2022 compared to 54% in 2021 and 65% in 2022, there are still factors affecting their bottom line.

And another statistic causing concern is that four out of five companies report having trouble hitting production goals. Not surprisingly, a major reason for this is the skilled labor gap, the impact of which is being felt “more than ever” by 87% of those surveyed for the study.

Unemployment Claims Rise to 235,000

Applications for jobless aid for the week ending July 2 rose to 235,000, up 4,000 from the previous week and the most since mid-January, the Labor Department reported Thursday. First-time applications generally track with the number of layoffs. Until early June, claims hadn’t eclipsed 220,000 since January and have often been below 200,000 this year.

The four-week average for claims, which evens out some of the week-to-week volatility, inched up by 750 from the previous week, to 232,500. The total number of Americans collecting jobless benefits for the week ending June 25 rose by 51,000 from the previous week, to 1,375,000. That figure has hovered near 50-year lows for months.

Mortgage Rates Fall to 5.30%, Reflecting Recession Fears

Mortgage rates recorded their largest decline since 2008 as investors raise their bets that the economy is headed for a downturn. The average rate on a 30-year fixed-rate mortgage fell to 5.30%, mortgage-finance giant Freddie Mac said Thursday. That is down from 5.70% last week. Mortgage rates haven’t recorded such a big weekly decline since December 2008, when the rate fell from 5.97% to 5.53%.

Growing fears of a recession in the U.S. stand to further push down mortgage rates as investors pile into U.S. Treasuries, widely seen as safe investments during times of economic uncertainty. Mortgage rates are closely tied to yields on the benchmark 10-year U.S. Treasury, which fell to their lowest level in more than a month this week. Yields fall when prices rise.

Read more at the WSJ

Housing-Affordability Index Drops to Lowest Level Since 2006

The National Association of Realtors’ housing-affordability index fell to 102.5 in May, the association said Friday, the lowest level since the index fell to 100.5 in July 2006. It was close to the lowest level since July 1990, when the index stood at 100.2. The affordability index incorporates median existing-home prices, median family incomes and average mortgage rates.

On a national basis, homebuying was relatively affordable in 2020 and last year, thanks to record-low mortgage rates even as strong demand sent home prices skyrocketing. But this year, mortgage rates have moved up sharply and house prices have climbed to new highs nationwide.

Read more at the WSJ

What Next for UK Economy as Boris Johnson Quits?

The race to replace Johnson, who announced on Thursday that he would quit office, could take weeks. That would leave the world’s fifth-biggest economy at risk of further drift at a time when sterling is near two-year lows against the dollar and the Bank of England is in a dilemma about raising interest rates without damaging economic activity.

The duration of Conservative Party leadership contests varies. Theresa May needed less than three weeks to win after David Cameron quit in 2016 as other contenders dropped out. But it took Johnson two months to become the new leader after May announced her intention to resign in 2019. Following is a summary of the key questions hanging over the British economy as the political drama plays out.

Read more at Reuters

Countries From the U.K. to Japan are Sending out Inflation Relief Checks to Help People Face Soaring Food and Energy Bills

Governments across Asia and Europe have begun distributing inflation relief money to their neediest citizens, too, as economies buckle under surging energy costs and worrying food shortages.

In Italy, inflation hit a 36-year high of 8% last month. In May, the government announced a $14.7 billion relief package that included one-off payments of about $200 to pensioners and people earning under $35,000 a year. The government has left it to employers to distribute the funds, parceling the $200 bonus into eligible people’s pay checks.
The Netherlands said in March it would issue a “one-off energy allowance” of roughly $800 per household for people on low incomes, to subsidize rising gas and fuel costs which surged 84% in June.
Germany, which is experiencing its highest inflation levels in 40 years, rolled out a $300 direct payment to all employed individuals in April to help offset rising energy costs, which had surged 35% over the year before.
France was among the first countries to deliver relief payments, pledging $100 payments to roughly 38 million citizens earning less than $2,000 per month last October.

Read more at Fortune

Shinzo Abe Brought Transformation to Japan That Will Last for Generations

When Shinzo Abe, Japan’s longest-serving prime minister, stepped down in 2020, he hadn’t quite achieved what he’d set out to. Abe, who served two stints as prime minister from 2006 to 2007 and from 2012 to 2020, was shot twice on Friday morning while giving a speech in the city of Nara in western Japan, where he was campaigning for the ruling Liberal Democratic Party (LDP) ahead of Sunday’s legislative elections. He died in the early evening hours at the age of 67.

“He was a political giant,” says Jeff Kingston, the director of Asian Studies at Temple University Japan. “He has been a continued towering presence… His voice carried considerable weight.” Abe will be remembered for remaking Japan. Kingston says he succeeded in “reviving Japanese confidence and projecting a more confident, upbeat Japan,” following an asset price bubble collapse in the early 1990s that threw Japan into a period of economic stagnation known as “the Lost Decades.”

Daily Briefing – 537

Post: Jul. 6, 2022

JOLTS: U.S. Job Openings Higher than Expected in May, Mfg Openings Fall by 136K

The number of job openings throughout the economy fell to 11.3 million at the end of May, according to Job Openings and Labor Turnover Survey, or JOLTS, data published Wednesday morning. That landed above the median estimate of 11 million openings from economists surveyed by Bloomberg. It also marks the second month in a row of declines. The report reveals little improvement in matching workers with jobs. The ratio of available workers to job openings held at 0.5, matching the all-time low first seen in March.

Openings fell the most at professional and business services firms, with such companies shedding 325,000 openings through May. Durable goods manufacturers followed with a decline of 138,000 openings to a total of 487,000, and nondurable goods manufacturers erased 70,000 openings to a total of 322,000 openings.

War in Ukraine Headlines

Fed Minutes: ‘More Restrictive’ Rates Possible If Inflation Persists

A deteriorating inflation situation and concern about lost faith in the Federal Reserve’s power to make it better prompted U.S. central bank officials to rally around an outsized interest rate increase and a firm restatement of their intent to get prices under control, minutes of the June 14-15 policy meeting showed.

With families stressed by rising food and gas prices, and no evidence Fed actions to date had begun to arrest the fastest inflation surge in 40 years, “many participants judged that a significant risk … was that elevated inflation could become entrenched if the public began to question the resolve of the (Federal Open Market) Committee to adjust the stance of policy as warranted,” according to the minutes, which were released on Wednesday.

Read more at YahooFinance

Consumers’ Inflation Psychology Is Stoking Anxiety at the Fed

Federal Reserve officials have indicated they accept the risks of causing a recession because they are determined to prevent something they view as worse: a change in consumer psychology that could sustain high inflation. “Is there a risk that we would go too far? Certainly there’s a risk, but I wouldn’t agree that’s the biggest risk to the economy,” Mr. Powell said at a central-banking forum in Portugal. “The biggest mistake to make…would be to fail to restore price stability.”

At the root of the approach is the fear that households and businesses will come to expect high inflation to persist, which can cause it to do so. That would require the Fed to increase rates more than otherwise to break that mind-set. Worries about inflation expectations were one reason Fed officials lifted their benchmark interest rate by 0.75 percentage point last month and have signaled they are likely to approve another such increase at their July 26-27 meeting.

Read more at the WSJ

U.S. COVID – Covid-19 Vaccine Doses, Once in High Demand, Now Thrown Away

Governments, drugmakers and vaccination sites are discarding tens of millions of unused Covid-19 vaccine doses amid sagging demand, a sharp reversal from the early days of the mass-vaccination campaign, when doses were scarce. Vaccine manufacturer Moderna Inc. recently discarded about 30 million doses of its Covid-19 shot after failing to find takers, while pharmacies and clinics have had to throw out unused doses from multi-dose vials from Moderna and Pfizer Inc. and its partner BioNTech SE that have a short shelf life once they are opened.

Demand may pick up in wealthy countries like the U.S. during the fall, when vaccine makers roll out modified shots that target Omicron subvariants and potentially provide better protection than current vaccines. Now, however, there are enough doses available to support vaccination of all adults and adolescents globally, according to Covax, an international program distributing vaccines to lower-income countries, led by the World Health Organization and other groups.

Read more at the WSJ

NYS Vaccine and COVID Update –

Vaccine Stats as of July 1:

One Vaccine Dose

91.1% of all New Yorkers – 16,678,442
In the Hudson Valley 1,734,898

Fully Vaccinated

77.8% of all New Yorkers – 14,967,653
In the Hudson Valley – 1,529,398

Boosters Given

All New Yorkers – 8,833,060
In the Hudson Valley – 1,076,155

The Governor updated COVID data through July 1. There were 10 COVID related deaths for a total reported of 72,079

Hospitalizations:

Patients Currently in Hospital statewide: 1,987
Patients Currently in ICU Statewide: 192

7 Day Average Positivity Rate – Cases per 100K population

Statewide 6.37% – 28.02 positive cases per 100,00 population
Mid-Hudson: 4.99% – 26.81 positive cases per 100,00 population

Useful Websites:

JAMA Study: COVID-19 Was the Third Leading Cause of Death from March 2020 to October 2021

In 2020, heart disease and cancer were the leading causes of death in the US, accounting for 1.29 million deaths, followed by COVID-19, accounting for 350 000 deaths.1-3 The pandemic may also have indirectly led to increases in other causes of death, including heart disease, diabetes, Alzheimer disease, and unintentional injuries.2,4 We examined the leading causes of death in the US, overall and in various age groups, from March 2020 to October 2021.

Deaths from cancer, heart disease, and COVID-19 accounted for the largest number of deaths in every group aged 55 years and older. Accidents accounted for the largest number of deaths in every age group 1 to 44 years.

UK PM Boris Johnson Resigns

prime Minister Boris Johnson has agreed to resign, his office said Thursday, ending an unprecedented political crisis over his future that has paralyzed Britain’s government. An official in Johnson’s Downing Street office confirmed the prime minister would announce his resignation later. Johnson had rebuffed calls by his Cabinet to step down in the wake of ethics scandals. He gave in after more than 40 ministers quit his government and told him to go.

It was not immediately clear whether Johnson would stay in office while the Conservative Party chooses a new leader, who will replace him as prime minister. Minutes before the news broke, Treasury chief Nadhim Zahawi called on Prime Minister Boris Johnson to resign just 36 hours after Johnson put him in the job, while another newly appointed Cabinet minister quit her post.

World’s COVID Vaccine, Drugs Equity Program Set to Wind Down this Fall

The program, known as the ACT-Accelerator, is a collaboration among the WHO, governments and global health organizations that works to ensure equitable access to COVID tools. It faced significant obstacles to get vaccines to low- and middle-income countries, but it eventually succeeded in shipping over one billion shots. As Covid cases have declined from the height of the pandemic, ACT-A has struggled to secure funding with only Germany, Norway, Sweden and Canada promising the requested financing this year.

The most well-known ACT-A initiative is the vaccines pillar COVAX, which aims to ensure shots are distributed around the world, particularly in countries that can’t afford them. An end to the current project raises questions about how the global health community, including the WHO, will continue to fund the fight against COVID.

Read more at Politico

Hochul Signs Three Climate-Related Measures Into Law

New York Gov. Kathy Hochul signed a bill into law Tuesday that will bolster the state’s building code when it comes to greenhouse-gas emissions and place tighter energy efficiency standards on new household appliances. The Advanced Building Codes, Appliances and Equipment Efficiency Standards Act was one of three climate-related measures approved by the governor, along with bills paving the way for utility companies to expand thermal energy and making more renewable energy construction projects subject to the prevailing wage.

The new building codes and appliances law is meant to cut down on energy use, both as a way to reduce emissions and cut down on energy costs for consumers. Among other things, the law requires the state Energy Research and Development Authority (NYSERDA) to come up with tougher water and energy efficiency standards for standard appliances – including everything from refrigerators to ice machines to clothes dryers to commercial fryers.

14 Hopeful Processors Apply to NY to Sell Recreational Marijuana

The state Office of Cannabis Management has received 14 applications in one week for people who want process cannabis flower, oils and products for New York’s first recreational marijuana sales expected late this fall. Farmers and entrepreneurs who want to prepare, manufacture and package cannabis products for sale started to file applications on June 28 for a Adult-Use Conditional Processor License. The state’s emerging cannabis industry is on track to license up to 150 dispensaries through early 2023.

The new state department has received the applications across 10 counties, including two each in Ontario, Albany, Erie and Monroe counties and one in Schenectady, Cortland, Tompkins, Onondaga, Yates and Orange counties, according to OCM on Tuesday. Conditional Adult-Use Retail Dispensary applications will open later this summer at an undetermined date.

Read more at State of Politics

Economists Estimate Hiring Demand Remained Strong as Summer Started

Demand for workers remained robust early in the summer, according to private-sector estimates, as the labor market remained tight alongside signs of slowing economic growth. Jobs site ZipRecruiter estimates that employers had slightly more than 11.3 million job openings through mid-June. Similarly, Bayard Advertising, a job-advertisement firm, thinks there were 10.9 million openings through mid-June based on job postings and active advertisements.

“We have seen a little bit of softening in certain industries, but the overall job market remains remarkably strong,” said Julia Pollak, chief economist at ZipRecruiter. Ms. Pollak said the industries that have been pulling back on hiring, such as technology and real estate, have been doing so mostly because of rising interest rates and stock-market turbulence.

Read more at the WSJ

Manufacturers Can’t Find Workers. Where’d They Go?

Theories have been easy to come by—data, less so. Which is why I was so enthusiastic about Bethia Burke’s project. President at the nonprofit Fund for Our Economic Future, her team recently set out to understand why 4 million people are quitting their jobs every month. From the survey of 5,000 working-age Ohioans, there is much manufacturers can learn to get a leg up in the uber-competitive fight for talent.

As much as anything, the pandemic gave people time with their thoughts—time, Burke says, that many spent reflecting on the briefness of life, how they’d like to spend it, and whether their current career path aligns with their personal and professional goals. “I have never had the chance to pause and reflect about what work and what life was,” respondents told Burke. Those moments of reflection have shown up in how people are making choices.

Here are some key insights from the Study at Forbes

China’s BYD Surpasses Tesla in Global EV Sales

BYD, the Chinese electric vehicle firm partly owned by Warren Buffett’s Berkshire Hathaway, became the world’s largest electric vehicle maker in the first half of 2022, wrestling the title from Elon Musk’s EV giant Tesla in another sign of the Chinese automaker’s resilience in the face of COVID-inflicted disruptions that plagued its rivals this year. However, the companies’ sales don’t represent an apples-to-apples comparison. Many of BYD’s car sales are plug-in hybrids and use gasoline engines to supplement battery power. Tesla, on the other hand, exclusively sells fully electric cars. China counts both types of vehicles as “zero-emission.”

BYD sold 641,350 new electric vehicles in the first half of this year, compared to Tesla’s 564,743, company filings show. Sales at BYD are also growing at a faster pace than at its American counterpart. In the first six months of 2022, BYD sold 486,771 more cars than it did in the first half of 2021, representing an increase of 315%. Tesla, meanwhile, sold 178,693 more vehicles in the first half of this year compared to last, a 46% year-on-year bump.

Read more at Fortune

France to Nationalize Energy Giant EDF to Help It Combat Europe’s Energy Crisis

The French government said it plans to nationalize utility company EDF saying the step is necessary to manage the transition away from fossil fuels at a time of energy crisis in Europe. The power company, which is already 84% controlled by the state, has been absorbing billions of euros in losses since President Emmanuel Macron imposed a cap on electricity prices, forcing EDF to buy supplies at higher market prices without passing the cost on to consumers. Those losses have become heavier as Russia has cut the flow of natural gas to Europe, triggering a surge in gas and power prices.

EDF also lies at the center of Mr. Macron’s ambitious plans to develop France’s nuclear fleet as a way of cutting emissions to fight climate change.

Read more at the WSJ

City and State Officials Direct Billions Toward Child Care

More than $340 million in federal funding is being made available to provide direct support for child care providers in New York under a second wave of grants to help stabilize the industry and its workforce, Gov. Kathy Hochul on Tuesday announced.

The money is meant to aid providers who are licensed with the Office of Children and Family Services or have registered child care programs, New York City-permitted group day care organizations or enrolled legally exempt group child care programs.

US Factory Boom Heats Up as CEOs Yank Production Out of China

Rattled by the most recent wave of strict Covid lockdowns in China, the long-time manufacturing hub of choice for multinationals, CEOs have been highlighting plans to relocate production — using the buzzwords onshoring, reshoring or nearshoring — at a greater clip this year than they even did in the first six months of the pandemic, according to a review of earnings call and conference presentations transcribed by Bloomberg.

The construction of new manufacturing facilities in the US has soared 116% over the past year, dwarfing the 10% gain on all building projects combined, according to Dodge Construction Network. There are massive chip factories going up in Phoenix: Intel is building two just outside the city; Taiwan Semiconductor Manufacturing is constructing one in it. And aluminum and steel plants that are being erected all across the south.

Daily Briefing – 536

Post: Jul. 5, 2022

U.S. Factory Orders Rise More Than Expected in May

New orders for U.S.-manufactured goods increased more than expected in May, bucking a slew of recent data showing a softening in the economy and underscoring that demand for products remains strong. The Commerce Department said on Tuesday that factory orders rose 1.6% in May after advancing 0.7% in April.

In May, there were increases in orders for primary metals, machinery and transportation equipment, among others. Orders for computers and electronic products also rose 0.5%. But orders for electrical equipment, appliances and components declined 1.0%. Shipments of manufactured goods gained 1.8% after accelerating 0.6% in April. Inventories at factories increased 1.3%. Unfilled orders rose 0.4% in May compared to a gain of 0.5% in April.

Read more at Reuters

War in Ukraine Headlines

Biden Might Soon Ease Chinese Tariffs, Its a Decision Fraught With Policy Tensions

President Biden is expected to roll back some tariffs on Chinese imports soon, a decision constrained by competing policy aims: addressing inflation and maintaining economic pressure on Beijing. People familiar with the situation say what comes next has been pending with Mr. Biden in recent weeks and that he could announce his decision this week. It could include a pause on tariffs on consumer goods such as clothing and school supplies, as well as launching a broad framework to allow importers to request tariff waivers.

Among his own cabinet, Treasury Secretary Janet Yellen has called tariffs a drag on the economy, saying the administration is looking at ways to reconfigure them to help curb inflation. On the other side are U.S. Trade Representative Katherine Tai and National security adviser Jake Sullivan, who see tariffs as valuable leverage in getting concessions from China.

Falling Commodity Prices Raise Hopes That Inflation Has Peaked

A slide in all manner of raw-materials prices—corn, wheat, copper and more—is stirring hopes that a significant source of inflationary pressure might be starting to ease. Many raw materials remain historically high-price, to be sure. And there are matters of supply and demand behind the declines, from a fire at a Texas gas-export terminal to better crop-growing weather. Yet some investors are starting to view the reversals as a sign that the Federal Reserve’s efforts to slow the economy are reducing demand.

Natural-gas prices shot up more than 60% before falling back to close the quarter 3.9% lower. U.S. crude slipped from highs above $120 a barrel to end around $106. Wheat, corn and soybeans all wound up cheaper than they were at the end of March. Cotton unraveled, losing more than a third of its price since early May. Benchmark prices for building materials copper and lumber dropped 22% and 31%, respectively, while a basket of industrial metals that trade in London had its worst quarter since the 2008 financial crisis.

Read more at the WSJ

U.S. COVID – Maps Track Hospitalizations

Covid-19 hospitalizations are increasing again after a surge in December and January. These maps from NBC news tracks hospitalizations in states using an analysis of U.S. Department of Health and Human Services COVID hospitalizations data.

Since April 2020, there have been at least 16,800 people hospitalized for Covid in the U.S. over a seven-day period and as many as 159,000, a new peak set during the omicron surge. The country across the pandemic has averaged about 60,000 hospitalizations for COVID a day.

See the maps at NBC News

NYS Vaccine and COVID Update –

Vaccine Stats as of July 1:

One Vaccine Dose

91.1% of all New Yorkers – 16,678,442
In the Hudson Valley 1,734,898

Fully Vaccinated

77.8% of all New Yorkers – 14,967,653
In the Hudson Valley – 1,529,398

Boosters Given

All New Yorkers – 8,833,060
In the Hudson Valley – 1,076,155

The Governor updated COVID data through July 1. There were 10 COVID related deaths for a total reported of 72,079

Hospitalizations:

Patients Currently in Hospital statewide: 1,987
Patients Currently in ICU Statewide: 192

7 Day Average Positivity Rate – Cases per 100K population

Statewide 6.37% – 28.02 positive cases per 100,00 population
Mid-Hudson: 4.99% – 26.81 positive cases per 100,00 population

Useful Websites:

SCOTUS Won’t Hear Challenge to New York Vaccine Mandate for Health Care Workers

The Supreme Court declined Thursday to take up a legal challenge brought by health care workers in New York who oppose the state’s vaccine mandate on religious grounds. Last December, the Supreme Court declined to temporarily block the vaccine requirement in the case. Justices Clarence Thomas, Samuel Alito and Neil Gorsuch said then that the court should have granted the request to put the mandate on hold.

Lawyers for the state said the Covid mandate was similar to longstanding rules requiring health care workers to be vaccinated against measles and rubella. Those requirements, too, allow exemptions only for medical reasons. Since last fall, the court has declined to block other vaccine mandates that don’t provide for religious exemptions, applying to New York teachers, Navy sailors, health care workers in Maine and Massachusetts, and college students in Indiana.

Read more at CNBC

BA.4 and BA.5 Variants Spur 20 Percent Rise in Cases Worldwide

WHO Director-General Tedros Adhanom Ghebreyesus stressed in his weekly briefing to journalists that the global figure overall remains “relatively stable”, but nobody should be under any illusion, that the coronavirus is on the way out. “This pandemic is changing but it’s not over. We have made progress but it’s not over.”

He warned that our ability to track the virus is under threat as reporting and genomic sequences are declining. The optimistic mid-year deadline for all countries to vaccinate at least 70 per cent of their populations is looking unlikely, with the average rate in low-income countries, standing at 13 per cent. On the bright side, in the past 18 months, more than 12 billion vaccines have been distributed around the world, and 75 percent of the world’s health workers and over-60s are now vaccinated.

Americans Tap Pandemic Savings to Cope With Inflation

From the start of the pandemic to the end of 2021, U.S. households built up $2.7 trillion in extra savings, according to Moody’s Analytics. Covid-19 lockdowns kept people at home with nowhere to spend money, and three rounds of stimulus payments boosted their incomes.

Now, with inflation at its highest point in decades and wage gains trailing behind, Americans are turning to that stash to cover costs.
The personal saving rate, a measure of how much money people have left over after spending and taxes, reached 5.4% in May. That figure is below the average of the last decade and far below the record of 34% in April 2020, according to the Bureau of Economic Analysis. Families have tapped about $114 billion of their pandemic savings so far, according to Moody’s Analytics, which analyzed government data.

Read more at the WSJ

Battle Over Big Tech bills Goes Down to the Wire

Lobbying both for and against legislation to crack down on U.S. tech giants is intensifying as the Senate enters a critical month for the antitrust bills. All eyes are on Senate Majority Leader Charles Schumer (D-N.Y.), who will need to decide whether to prioritize measures to regulate Google, Apple, Amazon and Meta over other key bills prior to the August recess.

The two bills, expected to be packaged together, take aim at the gatekeeper power of dominant tech companies. The American Innovation and Choice Online (AICO) Act would bar tech giants — most likely only those big four firms — from giving preferential treatment to their own products and services on the platforms they operate. The Open App Markets Act is more narrowly focused on mobile application stores. It would bar Apple and Google from favoring their own apps in stores, requiring developers to use their payment services or preventing users from downloading apps from third-party distributors

Read more at The Hill

China’s GDP Set to Hit 2-Year Low

China’s economy is expected to post its lowest quarterly growth rate in more than two years next week, as it counts the cost of lockdowns and other hardline coronavirus control measures imposed during its “darkest hours” of April and May.
Gross domestic product (GDP) is forecast to grow by 1.4 per cent from a year ago in the April-June period, according to Chinese data provider Wind.

Though not as bad as the 6.8 per cent contraction in the first three months of 2020, during the initial outbreak of the pandemic, it would mark the second slowest quarterly GDP expansion since 1992, when the data set first became available.

British Airways Cancels More Flights at ‘Most Challenging Period’ in History

British Airways is cancelling more flights scheduled for the summer holiday season, it said on Tuesday, at a time of widespread disruption at airports caused by staff shortages and a surge in travel demand. The airline said it would now reduce its April-October schedule by 11%, having said in May the cuts would amount to 10%.

The Telegraph newspaper reported late on Monday BA was cancelling more than 650 flights from London’s Heathrow and Gatwick airports to destinations including holiday spots in Spain, Portugal and Greece, affecting up to 105,000 travelers. Airlines and airports across Europe are struggling to keep up with strong post-pandemic demand from holidaymakers, causing chaos for travellers and forcing Heathrow and Gatwick to impose their own limits on capacity.

Read more at Reuters

Oil Prices Pulled Lower by Dimming Demand

Contracts for Brent crude, the international benchmark, finished Tuesday down 9.5% to $102.77 a barrel. West Texas Intermediate, the U.S. standard, was down 8.2% to $99.50 a barrel, its first close below $100 since early May and its lowest settle value since April 25.

Traders’ attention is shifting to the possibility that a downturn in economic growth could cool demand for fuel, bringing prices lower. Some energy traders have zeroed in on indications that high prices and a slowing economy are already tempering gasoline demand. On a four-week-average basis, demand was down about 2% year-over-year through June 24, according to the federal Energy Information Administration.

Read more at the WSJ

Natural Gas Soars 700%, Becoming Driving Force in the New Cold War

One morning in early June, a fire broke out at an obscure facility in Texas that takes natural gas from US shale basins, chills it into a liquid and ships it overseas. It was extinguished in 40 minutes or so. No one was injured. It sounds like a story for the local press, at most — except that more than three weeks later, financial and political shockwaves are still reverberating across Europe, Asia and beyond.

That’s because natural gas is the hottest commodity in the world right now. It’s a key driver of global inflation, posting price jumps that are extreme even by the standards of today’s turbulent markets — some 700% in Europe since the start of last year, pushing the continent to the brink of recession. It’s at the heart of a dawning era of confrontation between the great powers, one so intense that in capitals across the West, plans to fight climate change are getting relegated to the back-burner.

Read more at YahooFinance

Euro Nears 20-Year Low Against U.S. Dollar on Recession Fears

The euro neared a 20-year low against the dollar as investors worried that the eurozone may be approaching an energy shock that could tip it into recession. The bloc’s common currency fell 1.2% against the U.S. dollar to trade at $1.0301. The growing transatlantic interest-rate divide tends to reduce the attractiveness of holding euros versus dollars.

European policymakers usually tend to welcome a weaker currency, which helps to boost the region’s exports by lowering their cost in international markets. But a weak euro can also drive up inflation because it increases import prices. That is a problem when eurozone inflation is at a record high of 8.6%, especially since energy and commodities are often invoiced in dollars.

Read more at the WSJ

Ford’s US Car Sales Rise Despite Semiconductor Crunch

Ford reported higher U.S. auto sales Tuesday, bucking an industry-wide trend of declines in the latest quarter amid crimped supply of semiconductor and other key parts. The Michigan giant delivered 483,688 vehicles, up two percent from the year-ago level. While citing a continuation of supply constraints that have dogged the industry over the last year, Ford described vehicle demand as “strong.” Sales were dominated by larger vehicles, including pickup trucks and sport utility vehicles. The burden of limited inventories has been cushioned by strong pricing.

Ford’s sales figures came as rivals General Motors, Toyota and FCA (Stellantis) all reported quarterly sales drops of at least 15% amid supply chain problems.

Read more at IndustryWeek

Daily Briefing – 535

Post: Jul. 4, 2022

ISM Manufacturing PMI Slumps to 53 in June

The business activity in the US manufacturing sector expanded at a much softer pace in June than it did in May with the ISM Manufacturing PMI dropping to 53 from 56.1. This print came in weaker than the market expectation of 54.9. Further details of the publication showed that Employment Index declined to 47.3 from 49.6 and New Orders Index fell to 49.2 from 55.1. Finally, Prices Paid Index dropped to 78.5 from 82.2, compared to analysts’ estimate of 81.

“the US manufacturing sector continues to be powered — though less so in June — by demand while held back by supply chain constraints,” noted Timothy R. Fiore, Chair of the ISM Manufacturing Business Survey Committee. “Companies improved their progress on addressing moderate-term labor shortages at all tiers of the supply chain,” Fiore added. “Panelists reported lower rates of quits compared to May. Prices expansion slightly eased for a third straight month in June, but instability in global energy markets continues.”

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Real Disposable Income And Real Consumer Spending Fell In May

Personal disposable incomes rose 0.5% in May but fell 0.1% after adjusting for inflation. Personal consumption expenditures rose 0.2% but dropped 0.4% after adjusting for inflation. The saving rate moved up slightly from a pandemic low of 5.2% in April to 5.4% in May. The savings rate is still at the lowest level since late 2009, when the economy was still struggling to recover from the grip of the Great Recession and the global financial crisis.

The only category of spending to eek out a gain after adjusting for inflation in May was the service sector. Spending on big-ticket vehicles and housing-related goods and nondurable goods, including food at the grocery store, were crimped by the surge in inflation we are enduring. Consumers are saying they are pulling back on plans for driving trips due to higher costs.

US Annual Core PCE Inflation Falls to 4.7% in May

Inflation in the US, as measured by the Personal Consumption Expenditures (PCE) Price Index, stayed unchanged at 6.3% on a yearly basis in May, the US Bureau of Economic Analysis announced on Thursday. The Core PCE Price Index, the Federal Reserve’s preferred gauge of inflation, declined to 4.7% in the same period from 4.9% in April, in line with expectations

By this measure, inflation is rising at the fastest clip in decades as the Fed moves aggressively to contain it. Fed officials are keeping a close eye on the month-to-month changes in inflation measures for signs of progress as they attempt to tackle soaring costs. A hot inflation print released earlier this month factored in to the central bank’s decision to raise interest rates by a more-than-expected 75 basis points.

U.S. COVID – BA.4, BA.5

The US CDC is reporting 87.2 million cumulative cases of COVID-19 and 1,012,166 deaths. The average daily incidence has plateaued over the past several weeks, holding relatively steady at approximately 100-110,000 new cases per day. The current 7-day average is 108,505 new cases per day. The average daily mortality has held relatively steady at approximately 250-300 deaths per day since late May. However, the 7-day average appears to be rising and currently is 321 deaths per day.

Both new hospital admissions (+13% over the past week) and current hospitalizations (+5%) continue to increase. Considering the plateau in daily incidence, it is possible that hospitalizations could also remain elevated, rather than peaking and then declining. Community transmission is being driven by the Omicron BA.5 (36.6%) and BA.4 (15.7%) sub-lineages, which together are now more prevalent than the BA.2.12.1 sub-lineage (42%). Along with BA.2 (5.7%), these 4 sub-lineages of the Omicron variant represent all new SARS-CoV-2 infections in the US.

NYS Vaccine and COVID Update –

Vaccine Stats as of July 1:

One Vaccine Dose

91.1% of all New Yorkers – 16,678,442
In the Hudson Valley 1,734,898

Fully Vaccinated

77.8% of all New Yorkers – 14,967,653
In the Hudson Valley – 1,529,398

Boosters Given

All New Yorkers – 8,833,060
In the Hudson Valley – 1,076,155

The Governor updated COVID data through July 1. There were 10 COVID related deaths for a total reported of 72,079

Hospitalizations:

Patients Currently in Hospital statewide: 1,987
Patients Currently in ICU Statewide: 192

7 Day Average Positivity Rate – Cases per 100K population

Statewide 6.37% – 28.02 positive cases per 100,00 population
Mid-Hudson: 4.99% – 26.81 positive cases per 100,00 population

Useful Websites:

U.S. Study Shows Maternal Mortality Increased at Higher Rate than General Population

A new study examining maternal mortality rates in the US before and during the COVID-19 pandemic was published June 28 in the peer-reviewed journal JAMA Network Open. The study found that maternal mortality rose from 18.8 per 100,000 live births to 25.1 per 100,000 live births during the pandemic. This represents an increase of 33%, higher than the 22% increase in mortality expected as a result of the pandemic. Late maternal mortality increased 41%.

The largest increases in maternal mortality were seen for underlying cause-of-death codes related to indirect causes of death such as other viral diseases (2,374.7%), diseases of the respiratory system (117.7%), and diseases of the circulatory system (72.1%). Maternal mortality increases associated with direct causes of death were largely due to diabetes (95.9%), hypertension disorders (39%), and other pregnancy-related conditions (48%).

The Secrets of COVID ‘Brain Fog’ Are Starting to Lift

Many of these hard-to-define Covid-19 symptoms can persist over time—weeks, months, years. Now, new research in the journal Cell is shedding some light on the biological mechanisms of how Covid-19 affects the brain. Led by researchers Michelle Monje and Akiko Iwasaki, of Stanford and Yale Universities respectively, scientists determined that in mice with mild Covid-19 infections, the virus disrupted the normal activity of several brain cell populations and left behind signs of inflammation.

They believe that these findings may help explain some of the cognitive disruption experienced by Covid-19 survivors and provide potential pathways for therapies.

Supreme Court Limits Power of EPA, Other Regulatory Agencies

The Supreme Court last curtailed the Environmental Protection Agency’s powers to restrict greenhouse-gas emissions from power plants, in a decision that could limit the authority of government agencies to address major policy questions without congressional approval. While EPA had the power to regulate individual plants, the court ruled, Congress had not given it such expansive powers to set limits for all electricity generating units.

The majority justices said they recognized that putting caps on carbon dioxide emissions to transition away from coal-generated electricity “may be a sensible solution” to global warming. But they said the case involved a “major question” of US governance and jurisprudence and that the EPA would have to be specifically delegated such powers by the legislature. “It is not plausible that Congress gave EPA the authority to adopt on its own such a regulatory scheme,” they said.

Read more at the WSJ

Eurozone Inflation Hits New High, Pressuring ECB to Raise Key Rate More Forcefully

The eurozone’s annual rate of inflation accelerated to a fresh record high in June. The European Union’s statistics agency said Friday that consumer prices were 8.6% higher than a year earlier, a pickup from the 8.1% rate of inflation recorded in May and the highest since records began in early 1997. The acceleration was once again driven by energy and food prices. Household energy charges were 41.9% higher than a year earlier, while food prices were up 8.9%.

Consumer prices rose more slowly in the eurozone than in the U.S. during 2021, but have been catching up since the Russian invasion of Ukraine in February. That surge has prompted the ECB to bring forward its plans to raise its key interest rate, which it has said it would do on July 21. Policy makers last month said their first move would likely be an increase of a quarter of a percentage point.

Read more at the WSJ

Atlanta Fed GDP Tracker Shows the U.S. Economy is Likely Shrank by 2.1% in Q2

Most Wall Street economists have been pointing to an increased chance of negative growth ahead, but figure it won’t come until at least 2023. However, the Atlanta Fed’s GDPNow measure, which tracks economic data in real time and adjusts continuously, sees second-quarter output contracting by 2.1%. Coupled with the first-quarter’s decline of 1.6%, that would fit the technical definition of recession.

“GDPNow has a strong track record, and the closer we get to July 28th’s release [of the initial Q2 GDP estimate] the more accurate it becomes,” wrote Nicholas Colas, co-founder of DataTrek Research. The tracker took a fairly precipitous fall from its last estimate of 0.3% growth on June 27. Data this week showing further weakness in consumer spending and inflation-adjusted domestic investment prompted the cut that put the April-through-June period into negative territory.

Read more at CNBC

Micron’s Dim Outlook Suggests Tech Spending Is on the Wane

Micron Technology Inc. gave a surprisingly downbeat forecast for the current quarter after demand for phones and computers weakened, but vowed to move aggressively to stave off a chip glut. The company — the largest US maker of memory semiconductors — warned that sales will be about $7.2 billion in its fiscal fourth quarter, far below the analyst estimate of $9.14 billion. Excluding certain items, profit will be about $1.63 a share, the company said, compared with the $2.57 predicted by analysts.

Chief Executive Officer Sanjay Mehrotra and his executives told analysts on a conference call that they are cutting spending on new plants and equipment to slow increases in factory output. For their part, the company’s customers — electronic device makers — are scaling back orders to reduce their inventory.

Read more at Bloomberg

Supply Chain: Shifting Winds to Watch for in the 2nd Half of 2022

The second quarter of 2022 has been a time of both new and continued disruption. The world remains a turbulent place and these five ongoing trends will impact global manufacturing, and result in a re-engineering of most companies’ supply chains.

China reopening cities after the expected post-Olympic COVID lockdowns.
Return of the global shipping crisis.
Shifts in the semiconductor industry.
The ongoing Russian war in Ukraine.

Read more at IndustryWeek

GM Says Chip Shortage Hurt Q2 Sales, Sticks to Forecasts

General Motors Corp. executives on July 1 said lasting supply chain problems will ding its second-quarter sales because it is sitting on about 95,000 vehicles that still need parts, primarily semiconductors. Most of those unfinished vehicles were built in June. Not being able to ship many of them to dealers—which marks the point at which the company recognizes a sale—means sales for the second quarter were down about 15% from the prior-year period at roughly 582,000.

Despite that, the GM team said it expects the excess inventory to be sold by year-end and reiterated its full-year forecasts for profits (between $9.6 billion and $11.2 billion) and free cash flow ($7 billion to $9 billion). The sales warning and its citing of semiconductor shortage looks set to test GM CEO Mary Barra’s optimism of recent months that the chip shortage will ease significantly in the second half of 2022 and let GM grow wholesale volumes by 25% to 30%.

Read more at IndustryWeek

C-Suite May Soon Join the Great Resignation

A Deloitte survey, released on June 22, which was done in collaboration with independent research firm Workplace Intelligence, shows that executive-level business leaders are struggling with the stresses of work. The survey explores the C-suite’s role in organizational well-being and examines how an overall poor state of health is affecting retention for workers and executives alike.

The report discovered that 57% of employees and nearly 70% of the C-suite said they are seriously considering quitting for a job that better supports their well-being. Despite this mutual struggle, the C-suite largely doesn’t recognize that workers are struggling with their well-being, and this disconnect has the potential to further feed into The Great Resignation if leaders don’t do more to understand the needs of their workers and demonstrate that they truly care about their holistic well-being.

Read more at EHS Today

Chinese Posed as Environmentalists to Scuttle Rare Earth Projects

China has been running a disinformation campaign against rare earth mining and processing companies in the United States, the Pentagon confirmed this week. Cybersecurity company Mandiant said last week that Chinese actors used social media in a bid to discredit Lynas Rare Earths Ltd., an Australian company, and other rare earth mining firms to undermine the critical supply chain for the elements. The campaign comprised thousands of fake social media accounts, website and online forums.

Lynas is building a rare earth minerals facility in Texas for the Pentagon. Mandiant investigators said they identified Chinese agents posing online as “concerned local Texans” opposing the construction of the facility. China has aggressively moved to dominate the global market for ‘rare earth’ minerals, which are indispensable to many cutting-edge technological products, including smartphones, flat-screen TVs, medical equipment and water treatment systems. The U.S. and its allies have pressed in recent years to develop alternative sources of supply and production.

Hackers

US Supply-

Auto Sales

Daily Briefing – 534

Post: Jun. 29, 2022

Powell Says Fed Must Accept Higher Recession Risk to Combat Inflation

Federal Reserve Chairman Jerome Powell said he was more concerned about the risk of failing to stamp out high inflation than about the possibility of raising interest rates too high and pushing the economy into a recession. “Is there a risk we would go too far? Certainly there’s a risk,” Mr. Powell said Wednesday. “The bigger mistake to make—let’s put it that way—would be to fail to restore price stability.”

Mr. Powell said the central bank had to raise rates rapidly, even if that raises the risk of recession, to avoid a worse danger for the economy—of higher inflation becoming entrenched. He said the Fed didn’t have the luxury of moving rates up gradually because of concern that the recent period of high inflation may lead consumers and price-setters to expect elevated prices to persist.

Read more at the WSJ

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Richmond and Dallas Fed Surveys Show Mfg Weakness

A Tuesday survey from the Federal Reserve Bank of Richmond and a Monday survey from the Federal Reserve Bank of Dallas show more bleak signs for the economy. “Fifth District manufacturing firms reported another decline in activity in June,” according to the Federal Reserve Bank of Richmond index. Firms also reported being less optimistic about their economic future, as the “expectations index,” dropped from -13 to -19 over the last month.

Factory activity in Texas decreased significantly in the last month, according to the survey from the Federal Reserve Bank of Dallas. The production index fell from 18.8 in May to 2.3 this month. The number is the lowest the index has reached since May of 2020. The “new orders index,” which signals demand, decreased in June for the first time in two years, going from 3.2 to -7.3. The “future production index” which is a measure of expectations regarding future manufacturing decreased strongly in the last month, going from 19.9 to just 4.0.

Survey: 70% of Companies Planning Reshoring or Nearshoring Projects

The robotics and automation arm of global conglomerate ABB recently polled 1,610 executives in the U.S. and Europe about their capital spending plans in the wake of the COVID-19 pandemic’s arrival, the resulting supply chain chaos and Russia’s invasion of Ukraine. Of the respondents, 37% said they plan to return production to U.S. shores while a third said they will look to nearshore new operations.

Those new facilities will include more investments in automation than in the past, ABB’s survey shows. More than 40% of business leaders said they will use automation and robotics to make their supply chain more resilient. That will add to an upswing that grew the U.S.’ robot density–defined by the International Federation of Robotics as the number of industrial robots per 10,000 employees—from 176 units in 2015 to 255 in 2020.

Read more at IndustryWeek

U.S. COVID – The Omicron Subvariants BA.4 and BA.5 Have Together Become Dominant in the US

The CDC estimates that as of the week ending Saturday, BA.4 made up 15.7 percent of new cases, and BA.5 was 36.6 percent, accounting for about 52 percent of new cases in the United States, numbers that experts said should rise in the weeks to come. The statistics, released Tuesday morning, are based on modeling and can be revised as more data comes in, which happened in late December, when the agency’s estimates missed the mark.

The seven-day moving average of U.S. COVID-19 cases stood at 101,378 as of June 25, up 2.9% from a week earlier.

Read more at Reuters

NYS Vaccine and COVID Update –

Vaccine Stats as of June 24:

One Vaccine Dose

90.9% of all New Yorkers – 16,665,091
In the Hudson Valley 1,733,709

Fully Vaccinated

77.7% of all New Yorkers – 14,955,409
In the Hudson Valley – 1,528,482

Boosters Given

All New Yorkers – 8,779,787
In the Hudson Valley – 1,068,714

The Governor updated COVID data through June 24. There were 17 COVID related deaths for a total reported of 71,670

Hospitalizations:

Patients Currently in Hospital statewide: 1,824
Patients Currently in ICU Statewide: 183

7 Day Average Positivity Rate – Cases per 100K population

Statewide 4.68% – 24.84 positive cases per 100,00 population
Mid-Hudson: 4.18% – 23.64 positive cases per 100,00 population

Useful Websites:

U.S. Supply of Effective COVID Antibody Drug Dwindling

Biden administration officials have told Congress that the government’s supply of the Eli Lilly & Co. therapy, the only antibody drug for treating non-hospitalized patients that was found to work against Omicron, could run out if pandemic funding isn’t renewed. The supply could be depleted before fall if the pace of current use holds. The federal government is distributing about 30,000 doses a week of the therapy, according to the Health and Human Services Department.

Should the federal government be unable to procure more doses, Lilly would need to sell the drug to hospitals and states directly for the treatment to remain available. That would provide a first test of whether pandemic-related drugs and vaccines would remain accessible if shifted to the commercial market.

Read more at the WSJ

Why Parents are Finding it Difficult to Vaccinate Their Toddlers

A week after COVID-19 vaccines were authorized for kids aged 6 months to 5 years, some parents are still struggling to find shots for their little ones this summer. Health authorities and practitioners cite supply issues, complicated guidelines, lack of demand and administrative challenges for holding off on creating clinics for the youngest age group.

New York State Association of County Health Officials Executive Director Sarah Ravenhall said the majority of county health departments are working with pediatricians to create more vaccination opportunities. “The-age-5-and-under population requires specific expertise so it’s important to move carefully to ensure the most effective vaccination program,” Ravenhall said. “However, each county is unique, not only in the demographics and health status of their communities but also in the availability of pediatric providers. Therefore, each county, along with their pediatric providers, will necessarily identify what works best for their service area.”

BioNTech, Pfizer to Start Testing Universal Vaccine for Coronaviruses

Germany’s BioNTech (22UAy.DE), Pfizer’s (PFE.N) partner in COVID-19 vaccines, said the two companies would start tests on humans of next-generation shots that protect against a wide variety of coronaviruses in the second half of the year.

Their experimental work on shots that go beyond the current approach include T-cell-enhancing shots, designed to primarily protect against severe disease if the virus becomes more dangerous, and pan-coronavirus shots that protect against the broader family of viruses and its mutations. The German biotech firm said its aim was to “provide durable variant protection”

Read more at Reuters

Home Price Increases Slowed in April for the First Time in Months

Home price increases slowed ever so slightly in April, but it is the first potential sign of a cooling in prices. Prices rose 20.4% nationally in April compared with the same month a year ago, according to the S&P CoreLogic Case-Shiller Index. In March, home prices grew 20.6%. The last slight deceleration was in November of last year.

The 10-city composite annual increase was 19.7%, up from 19.5% in March. The 20-city composite posted a 21.2% annual gain, up from 21.1% in the previous month. These price gains for April, but the index is a three-month moving average. The average rate on the 30-year fixed mortgage just crossed the 5% mark in April after rising from around 3% in January. By June it had crossed 6%. Expect the slowdown to continue.

Read more at CNBC

Work From Home Helped Rural Counties, Can the Boom Last?

Small communities have long lagged far behind big cities in job creation and income growth. But since the pandemic, many are seeing an infusion of remote workers drawn by lower costs, laid-back lifestyles and natural beauty—and worn down by crime and other urban challenges. Their presence has helped spur hiring, income gains and home-price growth in rural towns.

The question now is whether these transplants are there to stay. Rural gains are in their early stages and could be vulnerable to a national economic downturn. They also depend on how far the back-to-the-office movement goes. In recent months, office reopenings and waning pandemic disruptions have drawn some workers back to urban life, a trend that is manifested in the rising rental prices of places such as New York City.

Read more at the WSJ

EU Agrees New Cars Must be Emissions-Free After 2035

Following 16 hours of negotiations, the European Union has agreed to a framework to eliminate carbon emissions from new cars and vans by 2035, effectively closing the chapter on the internal combustion engine. Many automakers are already in the process of switching over to cleaner fleets, but the industry will now face some pressure to hit the accelerator.

Environment ministers extended a CO2 exemption granted to so-called “niche” manufacturers – or those producing less than 10K vehicles per year – until the end of 2035. Italy, home to Ferrari and Lamborghini, also gave up demands for a five-year delay in the EU’s plan for carmakers to clean up their fleet. Meanwhile, alternative technologies like synthetic fuels and plug-in hybrids may be included in the future if they can achieve the complete elimination of greenhouse gas emissions.

Spain’s 12-Month Inflation Surpasses 10% in June, First Time Since 1985

panish 12-month inflation rose to 10.2% in June, the first time it has surpassed 10% since April 1985, from 8.7% in the previous month, preliminary data from the National Statistics Institute (INE) showed on Wednesday. Core inflation, which strips out volatile food and energy prices, rose to 5.5% year-on-year from 4.9% a month earlier, the highest since August 1993, the INE data showed.

The soaring cost of living in Spain is putting pressure on the government of Prime Minister Pedro Sanchez, which passed on Saturday a second series of measures, worth 9 billion euros ($9.45 billion), to help poor households cope with inflation.

Read more at Reuters

Hackers Target Logistics Firms to disrupt supply chains

Hackers are trying more and more to disrupt global supply chains by attacking logistics, shipping and cargo companies, particularly using phishing and ransomware.

Hackers target logistics firms to disrupt supply chains. Hackers are trying more and more to disrupt global supply chains by attacking logistics, shipping and cargo companies, particularly using phishing and ransomware. “[H]ackers do see the dependency on this supply chain. And then of course a logistics company is a target for them,” says Sami Awad-Hartmann, chief logistics officer at Hellmann Worldwide Logistics, which suffered a phishing attack in December.

Read more at CNBC

US Supply-Chain Jams Take New Life With Rail, Warehouse Squeeze

Public attention has waned two years into the crisis that disrupted global supply chains, giving the impression that everything is back to normal. On the ground, the US’s busiest port complex is still battling bottlenecks across the board. Here’s a look at some of the snarls that are standing in the way of the supply chain’s recovery…

Rail: The Port of Los Angeles has recently enlisted help from the White House to clear a backlog of rail-bound containers that’s tripled since February, taking up space on its docks and causing congestion.
Trucking: More than half of the truck gates at the Port of Los Angeles are still going unused on average due in part to the inconsistent staffing and operation hours at the terminals and distribution centers outside of the port.
Warehousing: The vacancy rate at Southern California facilities is now around 0.3%, with the lack of availability particularly acute in the Inland Empire counties of Riverside and San Bernardino.
Warehousing: The vacancy rate at Southern California facilities is now around 0.3%, with the lack of availability particularly acute in the Inland Empire counties of Riverside and San Bernardino.

Read more at Bloomberg

Auto Sales Expected to Fall 17% This Year Amid Supply-Chain Woes

Vehicle sales in the US are expected to fall 17.3% this year to the lowest level in a decade as semiconductor shortages and other supply-chain problems continue to hamper production. New-vehicle inventory has risen so far this year but remains at about 25 days worth of stock. Before the Covid-19 pandemic, dealers were carrying on average close to 70 days of supply.

Researcher Cox Automotive lowered its forecast to 14.4 million vehicles, citing production constraints. Despite the lower forecast, Cox believes lower auto sales belie the state of the economy because the job market and consumer demand remain strong. “We don’t think a recession is inevitable,” said Cox Chief Economist Jonathan Smoke. “We still have pent-up demand in retail. There are people who can’t get what they want.”

Daily Briefing – 533

Post: Jun. 28, 2022

NYS Primary – Hochul to Face Zeldin for Governor, Delgado Will Be Dem Lt. Gove Candidate

New Yorkers headed to the polls Tuesday to vote in the primary contests for governor, lieutenant governor and state Assembly. In the Democratic gubernatorial primary, Gov. Kathy Hochul handily won against a pair of challengers to earn a full term in office. On the other side of the aisle, Rep. Lee Zeldin (41%) defeated former White House staffer Andrew Giuliani ( 23%), businessman Harry Wilson (16%), and former Westchester County Executive Rob Astorino (19%).

Lt. Gov Antonio Delgado officially became the party nominee on Tuesday after securing 57% of votes in the primary contest with 85% of election districts reporting, according to preliminary results from the New York State Board of Elections. In the Assembly progressive candidates did poorly with several of the left-wing insurgents backed by the Working Families Party and the Democratic Socialists of America falling behind incumbents or more moderate opponents.

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Conference Board: Consumer Expectations Fall to 9-Year Low

The Conference Board’s consumer confidence index for June fell to 98.7 from 103.2 in May, below expectations for a reading of 100. The report’s expectations index, which is based on consumers’ short-term outlook for income growth, the job market, and overall business conditions, fell to 66.4, its lowest reading since March 2013.

“Consumers’ grimmer outlook was driven by increasing concerns about inflation, in particular rising gas and food prices,” said Lynn Franco, senior director of economic indicators at The Conference Board. “Expectations have now fallen well below a reading of 80, suggesting weaker growth in the second half of 2022 as well as growing risk of recession by year-end. “Looking ahead over the next six months, consumer spending and economic growth are likely to continue facing strong headwinds from further inflation and rate hikes,” Franco said.

Read more at YahooFinance

NAM Pushes Back on Tax Increases with New Ad Campaign

The NAM is launching a large-scale ad campaign calling on Congress to oppose new taxes on manufacturers. Print, radio and digital ads urging federal legislators to refrain from imposing new taxes on manufacturers—including energy producers, which have been asked to produce more energy—will run in Washington, D.C., and in key states across the country.

“Manufacturers have kept our promises—especially after the 2017 tax reforms—to create jobs, raise wages and benefits and invest in our communities,” NAM President and CEO Jay Timmons said in a statement. “To keep up this winning record, we need Congress to enact policies consistent with our manufacturing competitiveness agenda. That’s how we’ll strengthen supply chains, expand access to affordable, reliable energy and tamp down inflation. Our industry is ready to keep solving problems and create well-paying jobs—but returning to outdated tax policies will impede our progress.”

See the Ad Here

U.S. COVID – What is the Strategy Going Forward?

As world leaders drop the COVID-19 pandemic from their agendas, and US federal, state, tribal, and local governments roll back pandemic-related funding and mitigation efforts—such as mask mandates—local officials, grassroots organizations, and frontline community health workers continue to push for and implement piecemeal strategies to help increase vaccination rates, draw attention to the need for research into long COVID, and improve trust in and funding for public health systems.

There is a need for the US to create “a sustainable infrastructure that can keep more people from getting COVID, regardless of their social circumstances,” writes Ed Yong in The Atlantic. Indeed, the US Government Accountability Office (GAO) last week released a report recommending that the US Department of Health and Human Services (HHS) prioritize the development of a real-time, public health situational awareness network to help raise public awareness to facilitate the early detection of and rapid response to future and potentially catastrophic disease outbreaks, such as COVID-19.

NYS Vaccine and COVID Update –

Vaccine Stats as of June 24:

One Vaccine Dose

90.9% of all New Yorkers – 16,665,091
In the Hudson Valley 1,733,709

Fully Vaccinated

77.7% of all New Yorkers – 14,955,409
In the Hudson Valley – 1,528,482

Boosters Given

All New Yorkers – 8,779,787
In the Hudson Valley – 1,068,714

The Governor updated COVID data through June 24. There were 17 COVID related deaths for a total reported of 71,670

Hospitalizations:

Patients Currently in Hospital statewide: 1,824
Patients Currently in ICU Statewide: 183

7 Day Average Positivity Rate – Cases per 100K population

Statewide 4.68% – 24.84 positive cases per 100,00 population
Mid-Hudson: 4.18% – 23.64 positive cases per 100,00 population

Useful Websites:

FDA Advisers Recommend Modifying Covid-19 Boosters to Target Omicron

Advisers to U.S. health regulators met yesterday to consider whether and how Covid-19 vaccines should be updated to better target circulating variants of the coronavirus, in preparation for a fall booster-shot campaign. The advisory panel to the Food and Drug Administration, which includes doctors and public-health specialists, is expected to vote later in the day on whether to recommend updating Covid-19 vaccines to target the Omicron variant. The Panel voted 19 to 2 to recommend updating Covid-19 vaccines to target the Omicron variant.

The recommendation, which the FDA doesn’t have to follow but often does, suggests the agency go ahead and direct vaccine makers Pfizer Inc., its partner BioNTech SE and Moderna Inc. to proceed with plans to roll out modified boosters that target more recent Omicron subvariants, including BA. 4 and BA. 5, but which haven’t been tested in people. The FDA’s staff recently expressed support for updating the vaccines to improve their effectiveness against variants, but each choice has trade-offs.

Read more at the WSJ

Moving from Pandemic to Endemic

While it’s hard to catch a moving target, employers are starting to transition from the pandemic perspective to the endemic one. “So, now that we are in a new phase, safety professionals are able to apply the lessons learned during the pandemic to decide how to move forward,” notes Rachel Walla, owner of Ally Safety. Safety professionals need to continue to be prepared for any changes. And they do have processes and procedures to fall back on, given their overall “success” in how they were able to deal with the pandemic and keep employees as safe as possible while continuing to operate their companies. In her work with companies large and small and in a variety of industries, Walla has discovered some best practices. Her advice is as follows:

Have as few rules as possible.
Change rules slowly and deliberately.
Keep it simple and easy to follow.
Communicate the why and not just the how.

Read more at EHS Today

Price Caps on Russian Oil and Gas?

At the G7 summit in the Bavarian Alps, Western leaders are attempting to find new ways to curb soaring energy costs, especially given the fears of an oncoming recession. The latest idea being pitched is caps on the price of Russian oil and gas, though obstacles remain, and the concept would need to garner widespread adoption to be effective.

Details are still being discussed, but the plan aims to cap prices at a level close to the cost of Russian production – thereby denting Moscow’s finances but still ensuring critical energy flows. To accomplish this, Europe would restrict the availability of transport and insurance services to shippers which only agree to observe the price ceiling (~95% of the world’s oil tanker fleet is covered by the International Group of P&I Clubs in London and companies based in continental Europe). Another proposal would apply similar caps on Russian gas prices, or limit the usage of U.S. financial services that could also benefit the scheme.

Read more at Seeking Alpha

7 Things to Watch in New York’s Primaries Results from Tuesday

Tuesday’s primaries in New York are the first in the state’s history in which both major parties’ gubernatorial picks have faced competitive challenges for the nomination in the same year. Democratic Gov. Kathy Hochul is looking to fend off challenges from Long Island Rep. Tom Suozzi and New York City Public Advocate Jumaane Williams. Rep. Lee Zeldin is the nearly-unanimous pick of Republican leaders to represent their party, but needs to win a primary against former Westchester County Executive Rob Astorino; former White House aide Andrew Giuliani and businessman Harry Wilson.

There are also a host of contested races further down the ballot. Did, for example, Antonio Delgado secure the Lt. Governor spot on the ballot? What was turnout like? What was Hochul’s margin of victory? The answers to these – and other questions – will be watched closely by political insiders and junkies alike.

Read more at Politico

Lagarde Plays Down Recession Risks, Says ECB is Ready to ‘Move Faster’ on Rates if Needed

European Central Bank President Christine Lagarde on Tuesday played down concerns about a recession in the euro zone, also saying her team is ready to raise rates at a faster pace — if needed — if inflation continues to shoot higher. The euro zone is expected to see a headline inflation rate of 6.8% this year — well above the ECB’s target of 2%.

This comes at a time when economists are assessing whether or not the euro zone will escape a recession this year. The region has seen growth levels deteriorate amid an energy crisis, sanctions on Russia and food insecurity — just to name a few factors. “We have markedly revised down our forecasts for growth in the next two years. But we are still expecting positive growth rates due to the domestic buffers against the loss of growth momentum,” Lagarde said Tuesday at the Sintra Forum.

Read more at CNBC

Volkswagen Nears Deal to Sell Stake in Electrify America to Siemens

Volkswagen is close to selling a minority stake in its U.S. electric-vehicle charge business to an arm of Siemens A a deal that would value the network at more than $2 billion, according to people familiar with the matter. A sale of a stake in Volkswagen’s Electrify America LLC would generate additional funding as part of a plan to more than double the number of EV charging stations that Electrify America operates across the U.S. and parts of Canada to 1,800 by 2026. Reston, Va.-based Electrify America also offers EV charging stations for use at home.

Germany-based Siemens would make the investment through its Siemens Financial Services unit, according to the people. The deal would complement Siemens’s existing operations in the EV charging sector. In August, the engineering and technology company said it plans to expand its manufacturing operations in the U.S. as part of a plan to make over 1 million EV chargers for that market over the next four years.

Read more at the WSJ

Why Inflation Looks Likely to Stay Above the Pre-Pandemic Norm

Many forecasters expect that annual inflation will soon ebb, in part because of last year’s sharp increases in commodity prices falling out of the year-on-year comparison. You might be forgiven for not taking these prognostications too seriously. After all, most economists failed to see the inflationary surge coming, and then wrongly predicted it would quickly fade.

Some indicators point to more price pressure to come in the near term. Alternative Macro Signals, a consultancy, runs millions of news articles through a model to construct a “news inflation pressure index”. The results, which are more timely than the official inflation figures, measure not just how frequently price pressures are mentioned, but also whether the news flow suggests that pressures are building up. In both America and the euro area the index is still miles above 50, indicating that pressures are continuing to build.

Read more at The Economist

Nike Profits Dip on Lower Sales in North America, China

Lower sales in North America and China dented Nike’s quarterly results as the sports giant on Monday projected modest revenue growth amid the strong dollar, rising inflation and other headwinds. For the quarter ending May 31, Nike reported profits of $1.4 billion, down five percent from the prior year on a one percent dip in revenues to $12.2 billion.

The Oregon company — which has enjoyed strong pricing at times during the pandemic but also faced Covid-19 factory lockdowns in Asia that have crimped its inventories — reported lower profits for its fiscal fourth quarter. Nike Chief Financial Officer Matthew Friend forecast revenues of flat to “slightly up” in the coming quarter. He said the company was monitoring consumer behavior over “implications of high inflation” and adopting a “cautious approach” to Greater China given the country’s restrictive Covid-19 policies.

Read more at IndustryWeek

China Eases Quarantine for Overseas Arrivals Based on ‘Lessons Learned’ in Shanghai

China has reduced quarantine time for overseas arrivals, in the first step towards easing its Covid-19 border restrictions. It marks the biggest change to the rules since China closed its borders in March 2020, but the country’s border controls remain tough compared to others that have completely reopened and dropped testing requirements.

People arriving in mainland China will now have to spend seven days at a government-run quarantine facility, followed by another three days in home isolation, according to new guidelines released by the National Health Commission on Tuesday.

Rockland IDAs Keep Economic Engines Pumping, Even Through COVID

A report issued last week by the New York State Comptroller Thomas DiNapoli shows that despite COVID-19 there were an abundance of new projects being shepherded by Industrial Development Agencies across the state, and job creation related to these projects stayed strong. Among the 108 IDAs statewide, some 30 percent of the projects originated in New York City, Long Island, and the Mid-Hudson region.

In the Mid-Hudson Region, for fiscal year 2020 (the most recent available) 279 separate project sponsors availed themselves of IDA incentives, costing net tax exemptions of $108 million dollars. The net tax exemption is calculated by taking the total tax exemptions and deducting whatever payments the sponsors made in lieu of taxes.

Supreme Court’s Next Major Ruling Could Severely Limit the Power of the EPA

West Virginia v. the Environmental Protection Agency has the potential to sharply curtail the power of the EPA. The case started last year, when a federal court ruling left open the possibility that policies putting caps on greenhouse gas emissions from power plants could be allowed. While there have been no moves to do that, a collection of Republican attorneys general and coal companies banded together to appeal the ruling.

The case is an unusual one for the court. Instead of looking at a rule that has already been established, this one will set a precedent for future actions, specifically those tied to the EPA’s authority to regulate power plant emissions. Should the court rule against the EPA, that could hamper the Biden administration’s plans to combat climate change, as regulating authority could shift to Congress.

Read more at Fortune

Daily Briefing – 532

Post: Jun. 27, 2022

Core Capital Goods Orders, Shipments Increase Strongly

New orders for U.S.-made capital goods and shipments increased solidly in May. Orders for non-defense capital goods excluding aircraft, a closely watched proxy for business spending plans, rose 0.5% last month, the Commerce Department said on Monday. These so-called core capital goods orders gained 0.3% in April. Orders were boosted by strong demand for machinery, primary metals as well as computers and electronic products. But orders for electrical equipment, appliances and components fell 0.9%, while demand for fabricated metal products was unchanged.

Orders for durable goods, items ranging from toasters to aircraft that are meant to last three years or more, advanced 0.7% in May after rising 0.4% in April. They were lifted by a 0.8% gain in orders for transportation equipment. Motor vehicle orders climbed 0.5%. Orders for the volatile civilian aircraft category fell 1.1%.

Read more at Reuters

War in Ukraine Headlines

Metal Prices Drop at Fastest Rate Since 2008

Inflation, tight supplies and recession fears have sent industrial metals down to their worst quarter since the Great Recession after they’d recently reached record highs. The Bloomberg Industrial Metals Spot Subindex has dropped 26% this quarter, while copper has fallen 11% this month on the London Metal Exchange.

It’s a dramatic reversal from the past two years, when metals surged on a wave of post-lockdown optimism, inflationary predictions and supply snarls. Now, inflation is here and supplies are still tight. But prices are plummeting as worries about a slowdown in industrial activity across major economies dovetail with slumping demand in China.

Read more at Bloomberg

‘Really Out of Control.’ America Digs in for Inflation Fight

Inflation is the result of a mismatch between supply and demand: too many people chasing too few goods. The conventional wisdom is that the current round of price rises started because supply chains were hit hard by the pandemic. COVID-19 lockdowns temporarily closed factories and made it difficult for suppliers to catch up, especially if, say, a fire or other disaster caused further glitches.

The other explanation is that the pandemic caused demand to go up. Stuck at home, workers who no longer spent money on commuting or eating out suddenly had money to spend on home offices. Unprecedented rounds of federal stimulus payments to households didn’t hurt, either. “People felt much wealthier,” says Diego Comin, an economics professor at Dartmouth College. “We wanted to buy ovens and fridges and stuff at Home Depot to make our houses look better.”

U.S. COVID – Omicron-Adapted COVID-19 Vaccine Candidates Demonstrate High Immune Response Against Omicron

Pfizer Inc. and BioNTech announced positive data evaluating the safety, tolerability, and immunogenicity of two Omicron-adapted COVID-19 vaccine candidates: one monovalent and the other bivalent, a combination of the Pfizer-BioNTech COVID-19 Vaccine and a vaccine candidate targeting the spike protein of the Omicron BA.1 variant of concern.

Data from the Phase 2/3 trial found that a booster dose of both Omicron-adapted vaccine candidates elicited a substantially higher immune response against Omicron BA.1 as compared to the companies’ current COVID-19 vaccine. The robust immune response was seen across two investigational dose levels, 30 µg and 60 µg.

NYS Vaccine and COVID Update –

Vaccine Stats as of June 24:

One Vaccine Dose

90.9% of all New Yorkers – 16,665,091
In the Hudson Valley 1,733,709

Fully Vaccinated

77.7% of all New Yorkers – 14,955,409
In the Hudson Valley – 1,528,482

Boosters Given

All New Yorkers – 8,779,787
In the Hudson Valley – 1,068,714

The Governor updated COVID data through June 24. There were 17 COVID related deaths for a total reported of 71,670

Hospitalizations:

Patients Currently in Hospital statewide: 1,824
Patients Currently in ICU Statewide: 183

7 Day Average Positivity Rate – Cases per 100K population

Statewide 4.68% – 24.84 positive cases per 100,00 population
Mid-Hudson: 4.18% – 23.64 positive cases per 100,00 population

Useful Websites:

Nearly 1 in 5 Adults Who Had COVID Have Lingering Symptoms – Study

Nearly 1 in 5 American adults who reported having COVID-19 in the past are still having symptoms of long COVID, according to survey data collected in the first two weeks of June. Overall, 1 in 13 adults in the United States have long COVID symptoms lasting for three months or more after first contracting the disease, and which they did not have before the infection, the data showed.

Long COVID symptoms range from fatigue, rapid heartbeat, shortness of breath, cognitive difficulties, chronic pain, sensory abnormalities and muscle weakness. They can be debilitating and last for weeks or months after recovery from the initial infection. The CDC analysis also found that younger adults were more likely to have persistent symptoms than older adults.

Read more at Reuters

Primary Elections for Governor, Other Offices Across New York TODAY, June 28th

The first of two primaries for New York is TODAY, June 28th. New York voters are facing multiple elections this year thanks to a confusing and drawn-out redistricting process that flipped the Empire State’s election calendar on its head. The first primary is for Assembly and statewide offices — including races for governor, lieutenant governor, attorney general, comptroller, and U.S. Senate.

The second primary for NY State Senate and US congressional candidates will be held August 23rd. A special election to select who will represent the 19th US Congressional District will be held August 23rd. The election pits Ulster County Executive Pat Ryan against Dutchess County Executive Marcus Molinaro. the winner will serve the remainder of 2022.

Is Price-Gouging Helping Fuel High Inflation? ‘There are Much More Plausible Candidates’

for all the public’s resentment, most economists say corporate price gouging is, at most, one of many causes of runaway inflation—and not the primary one. They include: Robust spending by consumers. Supply disruptions at factories, ports and freight yards. Worker shortages. President Joe Biden’s enormous pandemic aid program. COVID 19-caused shutdowns in China. Russia’s invasion of Ukraine. And, not least, a Federal Reserve that kept interest rates ultra-low longer than experts say it should have.

Asked to name the culprits behind the spike in gasoline prices, 72% of the 1,055 Americans polled in late April and early May blamed profit-seeking corporations, more than the share who pointed to Russia’s war against Ukraine (69%) or Biden (58%) or pandemic disruptions (58%). And the verdict was bipartisan: 86% of Democrats and 52% of Republicans blamed corporations for inflated gas prices.

Read more at Fortune

High Gas Prices Spur Companies to Give Workers Cash for Commuting Costs

Rising gasoline prices are prompting more companies to offer fuel stipends, gift cards and other benefits, including continued work-from-home privileges, as they try to retain employees.

Though some executives are starting to worry a recession could be looming, several said making commutes affordable is essential as workers continue to quit jobs and it remains challenging to fill vacant positions. Employers say the perks are critical to keeping their businesses open as employees grumble about rising gas prices and office return plans.

Read more at the WSJ

GE Appliances Provides Job Opportunities for Refugees

It’s a road that was paved by GEA’s workforce development program that connects refugees in Louisville to good jobs at the company. . Louisville is an entry point for an immigrant population that has grown over the past 20 years.

The initiative is a partnership between GE, Catholic Charities and KY Refugee Ministries. The company has hired several dozen refugees from both Afghanistan and the Democratic Republic of Congo for various manufacturing roles at the plant and was led by talent recruiter Gabriela Salazar. It is based on a program that began by reaching out to members of Louisville’s Hispanic immigrant population. This successful program evolved to bringing in refugees. “For the company to be able to provide an opportunity for them to have a job so that they can provide for their families, and they can build a new life in Louisville, that’s exciting,” Gabriela said in a blog.

Part of the success of the program is that interpreters are provided so that language isn’t a barrier to landing a job. In fact, some of the company’s own bilingual employees volunteer their time to serve as interpreters to help new employees thrive.

Read more at IndustryWeek

Steel Tonnage Up Again, But Still Lagging

Global raw-steel output rose 3.9% from April to May, increasing for the third straight month to 169.5 million metric tons on the strength of notable month-to-month gains in China and most of the other large steelmaking nations. Production continues to lag the 2021 pace however, with worldwide tonnage down -3.5% from May 2021 and the year-to-date output down -6.3% from the January-May 2021 total.

In China, May raw steel production was up 3.9% from April, totaling 96.6 million metric tons for the month, thought that figure is -3.5% less than last May. For the current year-to-date (January-May), Chinese steelmakers have produced 435.0 million metric tons, or -8.7% less than last year’s five-month total. Steelmakers in India produced 10.6 million metric tons of raw steel during May,

Read more at American Machinist

Chemical Shortages hit U.S. Farms

U.S. farmers have cut back on using common weedkillers, hunted for substitutes to popular fungicides and changed planting plans over persistent shortages of agricultural chemicals that threaten to trim harvests. Agrichemical companies blame the COVID-19 pandemic, transportation delays, a lack of workers and extreme weather for shortages. Fertilizer and some seeds are also in short supply globally.

Spraying smaller volumes of herbicides and turning to less-effective fungicides increase the risk for weeds and diseases to dent crop production at a time when global grain supplies are already tight because the Ukraine war is reducing the country’s exports.

Read more at Reuters

Tesla, Ford and GM Raise EV Prices as Costs, Demand Grow

Auto makers have been raising prices on electric cars, partly to offset the soaring cost of materials used in their large batteries. Car executives also are capitalizing on strong consumer interest in EVs, as a new wave of plug-in vehicles hits the market. Overall, the average price paid for an electric vehicle in the U.S. in May was up 22% from a year earlier, at about $54,000, according to J.D. Power. By comparison, the average paid for an internal-combustion vehicle increased 14% in that period, to about $44,400.

Last week, GM tacked on $6,250 to the price of GMC Hummer electric pickup-truck models, which now range from around $85,000 to $105,000, citing an increase in commodity and logistics costs. The waiting list for the recently released truck is about two years, a GM spokesman said. Tesla this year has increased prices three times for a performance version of its top-selling Model Y SUV, adding a total of about 9% to the sticker price, which is now $69,900, according to Bernstein Research.

Read more at the WSJ

COVID Long-Hauler Gets Disability Pay in Reliance Standard Deal

Reliance Standard Life Insurance Co. will pay disability benefits to a California software sales executive who contracted Covid-19 in 2020, resolving her federal lawsuit claiming she was wrongly denied benefits for post-Covid symptoms that leave her unable to work.

Reliance Standard will reinstate the executive’s long-term disability benefits and reimburse her for all unpaid benefits, the parties said in a settlement notice filed June 24 in the US District Court for the Central District of California. The parties say they’re still discussing whether the executive is owed attorneys’ fees, and they requested an Aug. 29 deadline for her to file.

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Daily Briefing – 531

Post: Jun. 26, 2022

IMF Slashes U.S. Growth Forecast, Sees ‘Narrowing Path’ to Avoid Recession

The International Monetary Fund on Friday slashed its U.S. economic growth forecast as aggressive Federal Reserve interest rate hikes cool demand but predicted that the United States would “narrowly” avoid a recession. In an annual assessment of U.S. economic policies, the IMF said it now expects U.S. Gross Domestic Product to grow 2.9% in 2022, less than its most recent forecast of 3.7% in April. For 2023, the IMF cut its U.S. growth forecast to 1.7% from 2.3% and it now expects growth to trough at 0.8% in 2024.

Last October, the IMF predicted 5.2% U.S. growth this year, but since then, new COVID-19 variants and stubborn supply chain disruptions have slowed recovery, while a sharp spike in fuel and food prices further stoked inflation to 40-year highs.

Read more at Reuters

War in Ukraine Headlines

S&P Global Flash – U.S. Manufacturing PMI Falls:

The S&P Global Flash U.S. Manufacturing PMI declined from 57.0 in May to 52.4 in June, the lowest reading since July 2020.

Both new orders (down from 56.1 to 48.4) and output (down from 55.2 to 49.6) contracted in June for the first time in roughly two years, with global challenges, supply chain bottlenecks, workforce shortages and inflationary pressures weighing heavily on activity.
Delivery times (up from 31.1 to 33.0) remained too long but lessened a bit in June.
Exports (down from 52.2 to 49.7) fell for the first time since January, and growth in employment (down from 53.1 to 52.3) slowed.
Raw material costs (down from 84.2 to 77.9) remained highly elevated but decelerated in June, growing at the weakest pace since April 2021.

U.S., European Economies Slow Sharply as Recession Risks Grow

New figures on manufacturing and services activity underline how dark the outlook has become in both Europe and the U.S. Russia’s war in Ukraine has hit global growth as high inflation spread across the globe. Economies also face continuing supply-chain disruptions and the prospect of rising interest rates that curb business investment. Europe faces additional pressure from a possible energy shortage this winter.

Data firm S&P Global said on Thursday that its U.S. composite purchasing managers index—which measures activity in both the manufacturing and services sectors—fell to 51.2 in June from 53.6 the previous month to reach a five-month low. In the eurozone, the index fell to 51.9 in June from 54.8 in May, a 16-month low. A reading above 50.0 points to an expansion in activity, while a figure below that threshold points to a contraction.

Read more at the WSJ

U.S. COVID – Plateaued Cases

The US CDC is reporting 86.4 million cumulative cases of COVID-19 and 1,009,444 deaths. The average daily incidence has plateaued over the past several weeks, holding relatively steady at approximately 100-110,000 new cases per day. The current 7-day average is 99,365 new cases per day. Likewise, the average daily mortality has held relatively steady at approximately 250-300 deaths per day since late May. Notably, the current 7-day average is 248, the lowest level since July 13, 2021.

Both new hospital admissions (+1.5% over the past week) and current hospitalizations (+1.1%) continue to increase, although they appear to have stabilized over the past week. Considering tl plateau in daily incidence, it is possible that hospitalizations could also remain elevated, rather than peaking and then declining. Community transmission in the US continues to be driven by the BA.2.12.1 sub-lineage of Omicron (56%).

NYS Vaccine and COVID Update –

Vaccine Stats as of June 24:

One Vaccine Dose

90.9% of all New Yorkers – 16,665,091
In the Hudson Valley 1,733,709

Fully Vaccinated

77.7% of all New Yorkers – 14,955,409
In the Hudson Valley – 1,528,482

Boosters Given

All New Yorkers – 8,779,787
In the Hudson Valley – 1,068,714

The Governor updated COVID data through June 24. There were 17 COVID related deaths for a total reported of 71,670

Hospitalizations:

Patients Currently in Hospital statewide: 1,824
Patients Currently in ICU Statewide: 183

7 Day Average Positivity Rate – Cases per 100K population

Statewide 4.68% – 24.84 positive cases per 100,00 population
Mid-Hudson: 4.18% – 23.64 positive cases per 100,00 population

Useful Websites:

Vaccine Rollout for Young Kids

President Biden visited a vaccine clinic in Washington, DC, on June 21 to mark the rollout of the last major phase of vaccinations in the nation,. In his remarks, President Biden said the availability of vaccines for the youngest children marks a “monumental step forward” and provides “some peace of mind” for parents who have been waiting 18 months since the first vaccines were authorized for adults. There are about 19 million children aged 6 months to 5 years in the US.

The Biden administration has said 10 million doses are available for distribution to states and healthcare providers, but only 2.5 million doses of the Pfizer-BioNTech vaccine and 1.3 million doses of the Moderna vaccine have been ordered to date. It remains unclear how many parents will vaccinate their young kids. Only 29% of 5-11 year-olds are fully vaccinated, while 59% of those aged 12-17 years are fully vaccinated. Some parents already are facing challenges securing an appointment to get their children vaccinated, despite a federal operational plan released and implemented earlier this month. While neighborhood pharmacies and pharmaceutical chains are included in this phase of the vaccination campaign, many are expecting families to go to primary care physicians and pediatricians because of trust, familiarity, and relationships that may not exist at the pharmacy. Additionally, some parents are weighing the differences between the 2-dose Moderna and 3-dose Pfizer-BioNTech vaccines for children.

Primary Elections for Governor, Other Offices Across New York Tomorrow, June 28th

The first of two primaries for New York is tomorrow, June 28th. New York voters are facing multiple elections this year thanks to a confusing and drawn-out redistricting process that flipped the Empire State’s election calendar on its head. The first primary is for Assembly and statewide offices — including races for governor, lieutenant governor, attorney general, comptroller, and U.S. Senate.

U.S. Labor Market Remains Tight

The number of Americans filing new claims for unemployment benefits edged down last week as labor market conditions remained tight, though a slowdown is emerging amid high inflation and rising interest rates. Despite the second straight weekly decline reported by the Labor Department on Thursday, claims are hovering near a five-month high. There have been job cuts in sectors like technology and housing amid fears of a recession as the Federal Reserve aggressively tightens monetary policy to quell price pressures.

Initial claims for state unemployment benefits fell 2,000 to a seasonally adjusted 229,000 for the week ended June 18. Economists polled by Reuters had forecast 227,000 applications for the latest week. Claims have been treading water since tumbling to more than a 53-year low of 166,000 in March.

Read more at Reuters

U.S. Supreme Court Overturns Roe and Casey: What This Decision Means for Employers

Council Associate Member Jackson Lewis write that the Court’s ruling may affect employee benefit plans. Corporate management and directors should plan for changes and be aware of policies and fiduciary responsibilities. This can include preparing for public and employee reactions (for and against), legislative and law enforcement threats, social media posts, and other employee demonstrations. Pressure from a variety of groups to take a corporate public opinion also may occur.

Whether changes to leave policies, employee benefits, travel reimbursement, or handling accommodation requests, employers considering policies or benefit offerings in response to Dobbs must carefully review and consider federal and state laws, including state abortion-related legislation to evaluate the risk of potential liability.

Power Outages Are on the Rise in the US

Utility companies across the country are preparing for potential power-disrupting events later this year. In an analysis published by the Energy Information Administration (EIA), 2020 was the worst year for blackouts in the US, with residents averaging over eight hours without electricity, over twice the duration in 2013, when the EIA started collecting this data. The causes of the blackouts are a combination of severe weather events, aging power infrastructure, vegetation patterns, and increasing electricity demand.

An analysis from the Associated Press (AP) found that “Outages tied to severe weather rose from about 50 annually nationwide in the early 2000s to more than 100 annually on average over the past five years,” and “forty states are experiencing longer outages.” In 2021, the US was hit with 20 extreme weather events resulting in 688 deaths and $145 billion in social and economic costs according to the National Oceanic and Atmospheric Administration (NOAA). These extreme weather events were considered once-in-a-hundred-year events and not worth the capital investment to safeguard the electrical grid against, but now with such occurrences on the rise, people are reconsidering.

How Could Oil Price and Policy Rate Hikes Affect the Near-Term Inflation Outlook?

The authors from the NY Fed combine the demand and supply oil price decomposition from the New York Fed’s Oil Price Dynamics Report with yield curve data to quantify the likely path of inflation in the United States and the euro area over the next twelve months. Since the start of the year, oil prices have risen sharply owing to worsening expectations regarding global oil supply. We’ve also had an acceleration of inflation in the United States and the euro area, as well as a sharp steepening of the expected paths of policy rates in both economies.

These factors, combined with the potential for a slowdown in growth, have made the inflation outlook quite uncertain. Despite payback for the inflationary impact of current negative oil supply shocks during the second half of 2022 and the disinflationary effects of tighter monetary policy, by the second quarter of 2023 inflation rates will likely remain elevated.

Read more at the NY Fed

Met Life Small Business Index Reaches Pandemic-Era High, But Inflation Concerns Grow

The U.S. Chamber and MetLife’s latest Small Business Index revealed that inflation is the top problem for small business owners, and two in three have raised prices to cope. This quarter’s Small Business Index score is 64.1, the highest score since the start of the pandemic. This score is consistent with last quarter’s score of 63.0.

85% of small business owners are concerned about the impact of inflation, up from 75% last quarter.
37% of small businesses have increased flexible work options to retain workers during the ‘Great Resignation.’
61% of small business owners say their business is in good health.

Regeneron Breaks Ground On 1.8 Billion Investments at Tarrytown Campus

The groundbreaking for Regeneron’s previously announced $1.8 billion research, preclinical manufacturing and support facilities at the company’s Westchester County campus in Tarrytown was held Wednesday. The biotechnology company that invents and manufactures life-transforming medicines for people with serious diseases, committed to creating at least 1,000 new full-time, high-skill jobs in the Mid-Hudson Region over the next five years.

To encourage Regeneron’s continued expansion in New York State, Empire State Development is supporting the project with up to $100 million in performance-based Excelsior Jobs Program tax credits, consistent with the company’s hiring goals. The Council of Industry is teaming with Empire State Development to present an information session for other Hudson Valley Manufacturers on the CFA process and economic development incentives.

Boeing Problems Shift from Demand to Supply, CEO Says

Boeing Co. chief executive revealed that the manufacture of commercial and defense aircraft will continue to struggle with supply-chain irregularities for another year or more, or through most of 2023. “The shift from demand to, now, supply issues… is remarkable, the speed with which it happened… and will probably stay that way in my view almost to the end of next year,” Calhoun said, according to reports from the Bloomberg Qatar Economic Forum.

Calhoun added the “the biggest restraint of all for that mid-tier set of suppliers and sub-tier set of suppliers is labor availability.” The Boeing 737 MAX narrow-body jet program returned to production in 2021 after a 19-month grounding and investigation, and it has resumed some success in landing new orders from airlines planning fleet replacements. However, shortages of some parts and sub-systems have been reported for that program, for which Boeing as a large order backlog.
The new 777X has been delayed several times and now is expected in 2025.

Read more at American Machinist

Top Security Tips for Remote Workers

Working from home is becoming popular, primarily because of the flexibility this setup offers. However, one of the biggest concerns for remote workers is how to stay safe and secure while working online.

Here are some cybersecurity tips from Hudson Valley IT Services that can help you stay protected while working from home.

The Climate Crisis and Invasion of Ukraine are Transforming the Politics of Nuclear Power

The White Mesa mill in southern Utah is still converting uranium ore into yellowcake, a condensed powder. For decades the facility has seemed a relic of the region’s boom times. But two things have conspired to breathe new life into America’s uranium industry. First, climate concern has begun to change the politics around nuclear power, which does not emit carbon. Roughly 20% of the power produced by American utilities comes from nuclear, making it the country’s largest source of clean energy. Proponents of nuclear power argue that its steady, baseload power will be needed to keep the lights on when the sun doesn’t shine or wind doesn’t blow. There are signs that this argument is catching on. California is considering delaying the closure of its last nuclear plant, which is the state’s largest single source of electricity.

Second, Russia’s war in Ukraine has many countries squirming over their reliance on Russian energy. According to the Energy Information Administration, a government agency, 14% of America’s uranium imports in 2021 came from Russia (and a further 43% from Kazakhstan and Uzbekistan). Russia is the only commercial supplier of the type of uranium needed to fuel new reactor designs, which aim to reduce costs and safety concerns.

Read more at The Economist

Daily Briefing – 530

Post: Jun. 22, 2022

Powell Testimony: Fed Chair Says Higher Interest Rates Could Cause a Recession

Federal Reserve Chairman Jerome Powell said the central bank’s battle against inflation could lead it to raise interest rates high enough to cause an economic downturn. “It’s certainly a possibility,” Mr. Powell said Wednesday during the first of two days of congressional hearings. “We are not trying to provoke and do not think we will need to provoke a recession, but we do think it’s absolutely essential” to bring down inflation, which is running at a 40-year high.

Mr. Powell said the Fed plans to continue raising interest rates until it sees clear proof that inflation is slowing to the central bank’s 2% target. Officials raised interest rates by 0.75 percentage point last week, the largest increase since 1994, and Mr. Powell and several colleagues have signaled that another such increase could be warranted at their next meeting, July 26-27.

Read more at the WSJ

War in Ukraine Headlines

Biden Calls for Three-Month Federal Gasoline Tax Suspension

Mr. Biden and his advisers have been discussing the issue for months in the midst of increasing political pressure to take action to address record-high gas prices. “Today I’m calling for a federal gas tax holiday [and] state gas tax holiday for the equivalent relief to customers,” he said during a Wednesday speech

A suspension of the 18.4-cents-a-gallon federal gasoline tax and 24.4-cents-a-gallon diesel tax through September would require congressional approval, so a move by Mr. Biden to throw his support behind the effort would be largely symbolic. Lawmakers of both parties have expressed resistance to suspending the tax, a move that would likely need bipartisan support to become law. Some Democrats worry that a suspension of the tax would have a limited effect on prices, with oil companies pocketing much of the savings.

Read more at The Hill

Dudley: The US Economy Is Headed for a Hard Landing

If you’re still holding out hope that the Federal Reserve will be able to engineer a soft landing in the US economy, abandon it. A recession is inevitable within the next 12 to 18 months. Much like Wile E. Coyote heading off a cliff, the US economy has plenty of momentum but rapidly disappearing support. Falling back to earth will not be a pleasant experience.

In their latest set of projections, Fed officials laid out a benign scenario, in which the economy keeps growing at a moderate pace and unemployment increases only slightly, even as the central bank raises interest rates significantly to get inflation under control. While the Fed’s forecasts have become more plausible over time, I see several reasons to expect a much harder landing.

U.S. COVID Update – UAW, Detroit Automakers Make Face Masks Optional

Face masks are now optional at the Detroit Three’s plants, the automakers and the United Auto Workers announced Tuesday. The decision to make mask-wearing optional follows a meeting Monday of the COVID-19 Joint Task Force, a group formed in the early days of the coronavirus pandemic to establish safety protocols and made up of the three automakers and the union. Each of the companies will communicate to its employees when the change goes into effect at their facilities.

Last week, Michigan’s hospitalization and new case rates declined for the fourth straight week, according to Michigan Department of Health and Human Services data. Much of southeast Michigan is classified by the CDC as being low risk, according to the state’s COVID-19 dashboard.

NYS Vaccine and COVID Update –

Vaccine Stats as of June 17:

One Vaccine Dose

90.9% of all New Yorkers – 16,651,966
In the Hudson Valley 1,732,322

Fully Vaccinated

77.6% of all New Yorkers – 14,943,680
In the Hudson Valley – 1,527,264

Boosters Given

All New Yorkers – 8,720,979
In the Hudson Valley – 1,060,324

The Governor updated COVID data through June 17. There were 13 COVID related deaths for a total reported of 71,670

Hospitalizations:

Patients Currently in Hospital statewide: 1,842
Patients Currently in ICU Statewide: 211

7 Day Average Positivity Rate – Cases per 100K population

Statewide 5.48% – 24.98 positive cases per 100,00 population
Mid-Hudson: 5.99% – 25.13 positive cases per 100,00 population

Useful Websites:

COVID Vaccines are Here for Young Kids. But the Logistics Aren’t Easy

The White House has rolled out a plan for vaccinating the 19 million kids under 5 in the U.S., but if you’re just coming out of the holiday weekend trying to figure out where to find an appointment, you’re not alone. Claire Hannan has been helping immunization managers from all 50 states navigate COVID-19 vaccine rollouts since fall 2020 as the executive director of the Association of Immunization Managers. She told NPR what’s been happening behind the scenes to get this new low-dose formulation of Moderna and Pfizer’s vaccines out so that little kids can finally get protected.

There were two waves of pre-orders. The first wave closed earlier in June, and the provider had to be able to accept vaccine [Monday] — on the holiday — so the wave one pre-orders were small. There were significantly more orders in wave two of the pre-orders, which begin being delivered [Wednesday] or Thursday. So I think that it’ll be easy to find vaccines by the end of the week.

2.9% – The Hudson Valley Region’s May 2022 Unemployment Rate

The New York State Department of Labor today released preliminary local area unemployment rates for May 2022. The State’s area unemployment rates rely in part on the results of the Current Population Survey, which contacts approximately 3,100 households in New York State each month. New York State’s seasonally adjusted unemployment rate decreased from 4.5% in April to 4.4% in May 2022.

The May 2022 unemployment rate for the Hudson Valley Region is 2.9 percent. That is unchanged from April 2022 and down from 4.6 percent in May 2021. In May 2022, there were 33,300 unemployed in the region, up from 33,000 in April 2022 and down from 52,000 in May 2021. Year-over-year in May 2022, labor force increased by 28,000 or 2.5 percent, to 1,160,700.

NYS and HV Unemployment Rates May 2022

NY Business Leaders, Attorneys at Odds Over Proposed Workers Comp Changes

Business owners and personal injury attorneys are butting heads over the Justice for Injured Workers Act, which would increase workers compensation for milder injuries and make it easier for injured workers to seek additional benefits during their recovery. The bill, which passed the Senate and Assembly in the final hours of legislative session, is headed for Gov. Kathy Hochul’s desk. If signed into law, a worker who is partially disabled due to a workplace injury will receive the full benefit awarded employees with a total disability throughout their recovery unless the employer can provide suitable, light-duty work.

Business leaders say the changes to the state’s worker’s compensation system would devastate small businesses already struggling to stay afloat amid pandemic and inflation-related hardship. “I truly believe that the bill really helps workers comp claimant attorneys more than it helps anyone else while increasing costs for business at a time when businesses are facing absolute record increases in unemployment insurance, labor costs and everything else in the supply chain and the cost of doing business,” said Lev Ginsburg, counsel for the Business Council of New York State.

Read more at State of Politics

9.1 – UK Inflation Rises at Fastest Rate for 40 Years as Food Costs Jump

UK inflation edged up to 9.1% in the 12 months to May, from 9% in April, the Office for National Statistics (ONS) said. Fuel and energy prices are the biggest drivers of inflation, but the ONS said food costs had pushed it up further. Currently, inflation is at the highest level since March 1982, when it also stood at 9.1% and the Bank of England has warned it will reach 11% this year.

Workers and unions are pushing for pay rises to cope with higher prices. But the government has warned against employers handing out big increases in salaries over fears of a 1970s style “inflationary spiral” where firms hike wages and then pass the cost on to customers through higher prices. Inflation is the pace at which prices are rising. For example, if a bottle of milk costs £1 and that rises by 5p compared with a year earlier, then milk inflation is 5%.

IEA Chief Warns Europe to Prepare for Total Shutdown of Russian Gas Exports

The International Energy Agency has warned that Europe must prepare immediately for the complete severance of Russian gas exports this winter, urging governments to take measures to cut demand and keep ageing nuclear power stations open. Fatih Birol, the head of the IEA, said Russia’s decision to reduce gas supplies to European countries in the past week may be a precursor to further cuts as Moscow looks to gain “leverage” during its war with Ukraine.

“Europe should be ready in case Russian gas is completely cut off,” Birol told the Financial Times in an interview. “The nearer we are coming to winter, the more we understand Russia’s intentions,” he said. “I believe the cuts are geared towards avoiding Europe filling storage, and increasing Russia’s leverage in the winter months.” The IEA, which is primarily funded by members of the OECD, was last year one of the first official bodies to accuse Russia publicly of manipulating gas supplies to Europe in the build-up to Moscow’s invasion of Ukraine.

Canada is Banning Single-Use Plastics

Canada is moving forward with a comprehensive plan to ban “harmful” single-use plastics, in a sweeping effort to fight pollution and keep them out of the environment. Most plastic bags, disposable cutlery and plastic straws would fall under the new ban, as well as stir sticks, cups and six-pack rings that hold cans together. Few exceptions have been made for medical needs and accessibility reasons, or other recognized specific cases.

The order will phase in over the next several years, starting with a ban on the manufacture and import of single-use plastics from December 2022. Sales of the items will be prohibited the following year, while the measure will put an end to the export of Canadian plastics by the end of 2025. Banning single-use plastics will be a complex task given that they are abundant, convenient and cheap. Businesses that heavily rely on the material will also need to come up with new solutions, like the restaurant sector where plastic takeout containers, cutlery and bags are the norm.

Read more at CNBC

America Faces a Housing Bust

The National Association of Realtors’ measure of home affordability, based on mortgage rates, home prices and household income, showed that as of April existing homes were at their least affordable level since July 2007. They are even less affordable now. On Tuesday, the NAR said the median price on an existing home rose to $407,600 in May from $395,500 in April, while Freddie Mac reported last week that the average rate on a 30-year fixed mortgage was 5.78%, up from 5.23% a week earlier and from an April average of 4.98%.

Disappointing as some of the recent housing data have been, it will only get worse in the months ahead. The NAR on Tuesday said that existing-home sales in May slipped to 5.41 million from April’s 5.6 million, at a seasonally adjusted annual rate—the lowest level since July 2020. But the figures are based on closings, so many of the buyers locked in rates at earlier, lower levels. When home builder Lennar reported results for its fiscal quarter ended May 31 on Tuesday, it said that the combination of rising rates and rising prices “began to drive buyers in many markets to pause and reconsider.”

Read more at the WSJ

LinkedIn CEO Reveals the Generational Data Behind the Great Reshuffle – Gen Z Trend Should Frighten Employers

LinkedIn CEO Ryan Roslansky has issued a word of warning to employers grappling with an intensifying battle for talent: “Motivate and inspire Gen Z, or risk being left behind.” People are switching jobs at a higher rate than ever before as they figure out not only how and where they work, but why they work.

“What’s fascinating to look at is the fact that the Great Reshuffle has played out differently among generations,” he noted. The surge in job-hopping was mainly driven by Gen Z and millennials, who moved at a record pace in what represented an unprecedented shift in the advertising industry. “This generation believes it’s not only okay to move around frequently, but it’s expected, and potentially have a side gig or two along the way.

Read more at Fortune

Tesla Faces WARN Act Suit Over Layoffs

In a lawsuit filed Sunday, two former Tesla employees claim the electric carmaker violated federal law by laying off hundreds of employees on short notice. On June 2, Tesla CEO Elon Musk sent an internal email to executives saying he had a “super bad feeling” about the economy and saying the company needed to terminate about 10% of its salaried workforce, according to Reuters. Over the next few days, two workers at Tesla’s Gigafactory in Sparks, Nevada, say they were terminated. John Lynch said he was notified of his immediate dismissal on June 10, while Daxton Hartsfield said he was informed on June 15 and terminated on the same day.

Lynch and Hartsfield, who filed the lawsuit, said at least 500 of their coworkers in Nevada lost their jobs at around the same time, the document showed. The court document showed the plaintiffs stated Tesla’s actions violated the Worker Adjustment and Retraining Notification Act, which requires employers to notify workers at least 60 calendar days in advance before shutting down a plant or laying off 50 or more workers at the same site.

Airbus Draws Multi-Billion Order from Budget Carrier Easy Jet

The U.K. low-cost airline easyJet confirmed it will buy 56 new Airbus A320neo aircraft and convert existing orders for 18 A320neo jets to A321neo models. The OEM has not confirmed the contract, though the list price for such a purchase could be nearly $6.5 billion. Based in London and serving more than 30 European destinations, easyJet operates an all-Airbus fleet of 324 A320 and A320neo series aircraft.

The A320neo series jets are narrow-body aircraft powered by CFM International LEAP-1A or Pratt & Whitney PW1000G geared turbofan engines, and featuring sharklet wings, as part of fuel-saving design. Airbus maintains that the A320neo series achieves 15-20% greater fuel efficiency than the previous A320 series. Deliveries for the new aircraft will begin in 2026 and continue to 2029, as easyJet replaces older A319 and A320 jets.

Read more at American Machinist

Daily Briefing – 529

Post: Jun. 21, 2022

The Conference Board Leading Economic Index Fell Again in May

The Conference Board Leading Economic Index (LEI) for the U.S. decreased by 0.4 percent in May 2022 to 118.3 (2016 = 100), following a 0.4 percent decline in April 2022. The LEI is now down 0.4 percent over the six-month period from November 2021 to May 2022. “The US LEI fell again in May, fueled by tumbling stock prices, a slowdown in housing construction, and gloomier consumer expectations,” said Ataman Ozyildirim, Senior Director of Economic Research. “The index is still near a historic high, but the US LEI suggests weaker economic activity is likely in the near term.”

The ten components of The Conference Board Leading Economic Index for the U.S. include: Average weekly hours in manufacturing; Average weekly initial claims for unemployment insurance; Manufacturers’ new orders for consumer goods and materials; ISM Index of New Orders; Manufacturers’ new orders for nondefense capital goods excluding aircraft orders; Building permits for new private housing units; S&P 50 Index of Stock Prices; Leading Credit Index; Interest rate spread (10-year Treasury bonds less federal funds rate); Average consumer expectations for business conditions.

War in Ukraine Headlines

Anticipating U.S. Downturn, Elon Musk Details Tesla Staff Cuts

Elon Musk, CEO of Tesla said a 10% cut in salaried staff at the electric car maker will happen over three months, as the world’s richest man predicted a U.S. recession was more likely than not. Speaking at the Qatar Economic Forum organised by Bloomberg, Musk said the cuts would apply only to salaried workers, meaning a 3.5% reduction in total headcount, changes he described as “not super material”.

But he expressed concern about the prospect of a U.S. recession. “It’s not a certainty, but it appears more likely than not,” he said. Musk’s outlook echoes comments from executives, including JPMorgan Chase & Co CEO Jamie Dimon and Goldman Sachs President John Waldron. A “hurricane is right out there down the road coming our way,” Dimon said early this month.

Read more at Reuters

U.S. Existing-Home Sale Prices Hit Record of $407,600 in May

The median existing-home sale price in the U.S. shot above $400,000 in May, setting a record, as the housing market stalled under the weight of higher mortgage-interest rates. Home-buying demand continues to exceed supply, buoying home prices to new highs. The median existing-home price rose 14.8% in May from a year earlier to $407,600, a record in data going back to 1999, NAR said.

Sales of previously owned homes slid for a fourth straight month, declining 3.4% in May from the prior month to a seasonally adjusted annual rate of 5.41 million, the weakest rate since June 2020, the National Association of Realtors said Tuesday. May sales fell 8.6% from a year earlier.

Read more at the WSJ

U.S. COVID Update – Paxlovid Associated With Lower Hospitalization Rates

In a recent study posted to the medRxiv pre-print server, researchers investigated the effectiveness of nirmatrelvir plus ritonavir in preventing hospitalizations among individuals aged 50 or older and vaccinated for coronavirus disease 2019 (COVID-19). In the present study, researchers used integrated healthcare data of Mass General Brigham (MGB) to identify recorded COVID-19 infections between January 1 and May 15, 2022, any subsequent hospitalizations through May 29, 2022, and deaths through June 12, 2022.

35% of the hospitalizations in the nirmatrelvir plus ritonavir arm of the present study occurred within two days of prescription. Note that the EPIC-HR trial comprised only unvaccinated individuals with a median age under 50 and had a 7% hospitalization rate in the placebo arm compared to the current study. Overall, nirmatrelvir plus ritonavir consistently protected hospitalization and death despite varying hospitalization rates across groups. Therefore, the authors emphasized continuous assessment of the clinical efficacy of nirmatrelvir plus ritonavir with other therapeutic options as future SARS-CoV-2 variants continue to emerge.

NYS Vaccine and COVID Update –

Vaccine Stats as of June 17:

One Vaccine Dose

90.9% of all New Yorkers – 16,651,966
In the Hudson Valley 1,732,322

Fully Vaccinated

77.6% of all New Yorkers – 14,943,680
In the Hudson Valley – 1,527,264

Boosters Given

All New Yorkers – 8,720,979
In the Hudson Valley – 1,060,324

The Governor updated COVID data through June 17. There were 13 COVID related deaths for a total reported of 71,670

Hospitalizations:

Patients Currently in Hospital statewide: 1,842
Patients Currently in ICU Statewide: 211

7 Day Average Positivity Rate – Cases per 100K population

Statewide 5.48% – 24.98 positive cases per 100,00 population
Mid-Hudson: 5.99% – 25.13 positive cases per 100,00 population

Useful Websites:

Shots for Toddlers

Pediatricians, children’s hospitals and pharmacies across the U.S. began administering COVID-19 vaccines today to kids between 6 months and 5 years old, after the FDA and CDC authorized the jabs last week for the country’s youngest children under emergency approval. Only 18% of parents say they will vaccinate their kids in the age group as soon as possible, according to recent poll from the Kaiser Family Foundation, due to the lack of “enough information about the vaccines’ safety and effectiveness.” A similar dynamic played out after the shots opened to children aged 5 to 11 last November, with less than a third of that demographic getting vaccinated (compared to the 75% fully vaccinated U.S. population over the age of 12).

According to the CDC, 480 children under the age of five have died from COVID-19 through May 2022, while more than 30,000 children in the U.S. have been hospitalized. Some children can also have lasting symptoms known as “long COVID,” while infections can spread within a household, or to adults that may be more vulnerable. The CDC is even advising vaccination for those who already had COVID-19 to protect against reinfection, with an estimated 75% of children showing evidence of having had the disease.

Read more at Seeking Alpha

Israeli Study Uncovers Where COVID-19 Variants Come From

Although COVID-19 infections are much less deadly than during the pandemic’s first year, the cunning and elusive virus has since developed a large number of mutations far exceeding the rate that was initially observed. Where do these variants come from and what circumstances empower them? Virus “detectives” at Tel Aviv University (TAU) and Sourasky Medical Center have uncovered the answers.

Patients with weakened immune systems from chronic diseases and those taking medications that reduce the body’s ability to fight invading pathogens are at risk for chronic infection and develop several highly mutated coronavirus variants.
Although this is disconcerting, there is also some good news: While many different variants are formed in immunocompromised patients, these mutated forms are less likely to spread to others.

McMahon: Bear Market Spells Big Trouble for NY State and City Budgets

Wall Street generates an outsized share of New York’s tax revenue, so the recent drop in stock prices should worry both Gov. Kathy Hochul and Mayor Eric Adams — even if a recession doesn’t quickly follow. The securities industry generates 20% of total private wages in the city, despite comprising only 5% of private employment. In all, one out of every nine jobs in every category is either directly or indirectly associated with Wall Street, the state comptroller has estimated.

The state government built up a $9 billion reserve cushion in fiscal 2022, and Hochul projected another $5 billion surplus in fiscal 2023, which began April 1. But if the bear market is followed soon by a full-blown recession, projected state revenues could easily fall by 20% or more over the next few years. In that case, the state could begin draining, not building, reserves as soon as next spring.

Yen Dives to New 24-year Low vs Dollar

The Japanese yen plunged on Tuesday to the lowest levels versus the U.S. dollar since October 1998, as the Bank of Japan’s ultra-loose monetary policy stance continued to weigh. The yen dropped 0.9% to a new 24-year low of 136.330 per dollar, extending losses which have already seen it shed more than 18% of its value versus the greenback this year.

“The trend is your friend after the Bank of Japan last Friday stuck to its ultra-dovish policy mantra,” said Kenneth Broux, an FX strategist at Societe Generale. The currency lost more ground after the Bank of Japan on Friday dashed any expectations of a change in policy and continued to stand alone in its commitment to ultra-easy monetary settings.

Will the U.S. Dollar Continue to Dominate World Trade?

In the modern era, the U.S. dollar has a dominant international presence, followed to a lesser extent by the euro and a handful of other currencies. Although the use of specific currencies is remarkably stable over time, with the status of dominant currencies remaining unchanged over decades, there have been decisive shifts in the international monetary system over long horizons. For example, the British pound only lost its dominant currency status in the 1930s, well after Britain stopped being the leading world economy.

In a new study, we show that the currency that is used in international trade transactions is an active firm-level decision rather than something that is just fixed. This finding raises the question of what factors could augment or reduce the U.S. dollar’s dominance in world trade.

Read more at the NY Fed

What Is the Scope of Russian Sanctions?

Since March 2022, U.S. companies doing business internationally have faced governmental sanctions imposed in response to Russia’s invasion of Ukraine. Controls affecting interactions with Russian, Belarussian and Ukrainian companies and individuals have created layers of challenges to be resolved.

As the war in Ukraine persists, many U.S. businesses are evaluating how best to proceed. A clear-eyed assessment of the scope of the new sanctions is essential to understanding how to navigate them in the months, and possibly years, ahead. Moreover, there are techniques available that companies may wish to consider as they evaluate opportunities in light of current and evolving restrictions.

Read more at IndustryWeek

Compliance Reporting Drops 30% Due to Pandemic

The fallout from the pandemic has reached the compliance arena, with reporting dropping 30% according to a new survey from Gartner, Inc. Employees are both less likely to observe misconduct and less likely to report it when observed. There are also new forms of misconduct that are emerging due to a virtual environment, such as inappropriate video backgrounds or online behavior.

There is a difference between remote employees who observe 11% less misconduct than their in-office peers. One of the drivers for this dip, according to the survey is the decrease in observed misconduct around travel, gifts and entertainment as opportunities for misconduct in these areas are significantly lower. Yet, types of misconduct that compliance typically has a very low tolerance for are holding steady or on the rise. “Bullying, intimidation and unwanted behavior are up 7% for remote workers; misuse of time and company assets is up 3%,” said Audet. “Sexual harassment is relatively steady at just 1% lower for remote employees since the pandemic.”

Read more at EHS Today

Freeport LNG Extends Outage After Fire, Targets Year End for Full Pperations

Freeport LNG, one of the largest U.S. operators of liquefied natural gas export terminals, on Tuesday said damage from last week’s fire at its Texas plant would keep it fully offline until September with only partial operation through year end. Natural gas prices slumped in the United States and soared in Europe on news of an extended shutdown. The facility accounts for about 20% of U.S. LNG exports and has been a major supplier to European buyers seeking alternatives to Russian gas since its invasion of Ukraine.

After 81 days in “uptrend,” the July Henry Hub contract has shifted into “neutral” according to the triple moving average system. This system uses three moving averages, one short, one medium, and one long. It indicates uptrend when the short moving average is higher than the medium moving average and the medium moving average is higher than the long moving average.

Read more at Reuters

Kellogg to Focus on Snacks With Surprise Three-Way Split

Snack and cereal giant Kellogg said on Tuesday it would split into three independent companies, in the latest U.S. corporate overhaul aimed at simplifying its structure and focusing on expanding its snack business. Shares of the company, which began life in 1894 when W.K Kellogg created Corn Flakes and became known around the world for its breakfast cereals, jumped 6% in premarket trading.

The breakup of the Pringles, Cheez-It and Pop-Tarts maker would result in the creation of a global snacking business that would also house its international cereal and noodles brands and its North America frozen breakfast division. Its North American cereal unit and plant based segment, which includes brands such as MorningStar Farms, will be spun off to its shareholders in a tax-free transaction, the Frosted Flakes and Froot Loops cereal maker said. The business brought in net sales of $11.4 billion in 2021, accounting for 80% of its total revenue.

Read more at YahooFinance

Law Banning Goods Produced by Uyghur Forced Labor Takes Effect

American businesses in China say they fear a U.S. law blocking most imports from China’s Xinjiang region that went into effect Tuesday might interrupt shipments and raise compliance costs, as uncertainty clouds how it will be enforced. The Uyghur Forced Labor Prevention Act presumes that all items produced in China’s western region of Xinjiang, or by entities linked to the government there, are made with forced labor and blocks companies from importing such products.

Before the law, the onus was on U.S. customs officials to provide evidence of the presence of forced labor when they impounded such shipments. Current and former U.S. business executives say the law is likely to result in short-term supply-chain disruptions as importers seek to adapt to the new requirements and see how rules are being enforced. In the longer term, some say, the law may accelerate a shift of some global supply chains out of China.

Daily Briefing – 528

Post: Jun. 20, 2022

China Studying ‘Extraordinary’ Support for Manufacturers: Report

China is planning “extraordinary new policies to help downstream industrial firms that have seen their profits hit by the high cost of raw materials,” according to Shanghai Securities News. The Ministry of Industry and Information Technology is studying measures to enhance the structure of supply-side policies, boost consumer demand and incentivize investments in technology, the newspaper said in a report Monday. The paper, which is managed by the official Xinhua News Agency, did not cite a source.

Contractions in mid- and downstream sectors would lead to significantly weaker manufacturing investment in the second half of the year, which would deal a blow to the economy. “Authorities should also help stabilize investment by boosting consumer spending on new energy cars, environmentally friendly construction materials and home appliances,” said Li Hongtu, chief economist of financial information provider Bolan Finance, according to the report.

Read more at Bloomberg

War in Ukraine Headlines

“Not Inevitable.” Yellen Comments on Recession Prospects

The recession that many Americans fear is coming is not “at all imminent,” Treasury Secretary Janet Yellen said Sunday. Talk of a recession has accelerated this year as inflation remains high and the Federal Reserve takes aggressive steps to counter it. On Wednesday, the Fed announced a 75 basis point interest rate hike, its largest since 1994. Fed Chair Jerome Powell also indicated the Federal Open Market Committee’s intent to continue its aggressive path of monetary policy tightening in order to rein in inflation.

“I expect the economy to slow,” Yellen said in an interview with ABC’s “This Week.” “It’s been growing at a very rapid rate, as the economy, as the labor market, has recovered and we have reached full employment. It’s natural now that we expect a transition to steady and stable growth, but I don’t think a recession is at all inevitable.”

Read more at CNBC

Biden Expects Decision on Federal Gas tax Holiday by End of Week

President Biden on Monday told reporters he hoped to make a final decision about whether to support a federal gas tax holiday by the end of the week as high fuel prices continue to pose a problem. Suspending the federal gas tax would require an act of Congress, but a public push by Biden in favor of the policy could help spur action on Capitol Hill.

Biden did not rule out sending gas rebate cards to Americans, though administration officials have in recent days sounded cool to the idea. An estimate from the Penn Wharton Budget Model released earlier this year found that suspending the federal gas tax from March to December of this year would reduce average per-capita gasoline spending by between $16 and $47 for that period.

Read more at The Hill

US COVID – COVID Disrupts Summer Plans as Variants Keep Case Numbers High

Covid-19 isn’t causing acute illness and death on the scale it once did, thanks in part to protection built up by vaccines and prior infections. But Covid-19 is far from under control, epidemiologists say, and the virus is sickening and sidelining people from work or social events as it continues to spread. “People can’t come to work. People are short-staffed,” said Jason Salemi, an associate professor of epidemiology at the University of South Florida College of Public Health. “Covid-19 is still inflicting enough damage.”

The U.S. is logging some 100,000 known cases a day, and many more are being detected via at-home tests health departments don’t track. This is a stark difference from a year ago, when U.S. cases sank below 12,000 a day, the lowest level since the first surge, as vaccinations rose and many hoped the virus was in retreat.

Read more at the WSJ

NYS Vaccine and COVID Update –

Vaccine Stats as of June 17:

One Vaccine Dose

90.9% of all New Yorkers – 16,651,966
In the Hudson Valley 1,732,322

Fully Vaccinated

77.6% of all New Yorkers – 14,943,680
In the Hudson Valley – 1,527,264

Boosters Given

All New Yorkers – 8,720,979
In the Hudson Valley – 1,060,324

The Governor updated COVID data through June 17. There were 13 COVID related deaths for a total reported of 71,670

Hospitalizations:

Patients Currently in Hospital statewide: 1,842
Patients Currently in ICU Statewide: 211

7 Day Average Positivity Rate – Cases per 100K population

Statewide 5.48% – 24.98 positive cases per 100,00 population
Mid-Hudson: 5.99% – 25.13 positive cases per 100,00 population

Useful Websites:

Pfizer vs Moderna for Vaccinating Kids Under 5: Which is Better for Your Toddler?

The Food and Drug Administration gave its vote of confidence for shots from Moderna and Pfizer to start going into little arms on Friday. Because there are two different brands being offered, with different formulations, dose schedules, and side effects, parents are already weighing which shot is best for them and their children.

“Both are great options,” ER doctor Jeremy Faust wrote in his Inside Medicine newsletter, expressing confidence in both Pfizer and Moderna. However, Faust, along with public health expert Katelyn Jetelina and prominent parenting author Emily Oster have all decided that Moderna is the top pick for their own young kids. Their reasoning boils down to the fact that, according to early data, Moderna’s shot appears to pack a bigger immune punch, and it does the job faster. While short-term side effects are slightly worse with Moderna than with Pfizer, Moderna kids appear to gain protection against COVID in a matter of weeks, not months.

Companies Under 50 Employees Fall Behind on Hiring as Inflation Takes a Toll

Head counts at companies with fewer than 50 employees declined in three of the past four months, according to ADP payroll data, even as employment at larger firms continued to grow. Owners of many small companies say inflation has added to the pressures of an already tight job market, making it increasingly difficult to keep pace with the wages and benefits offered by large employers.

Sixty-three percent of small-business owners say that hiring challenges are affecting their ability to operate at full capacity, according to a June survey of more than 825 small businesses for The Wall Street Journal by Vistage Worldwide Inc., a business coaching and peer advisory firm. “Small firms are still playing catch up,” ADP chief economist Nela Richardson said. If the economy weakens, small firms are also likely to change their hiring plans, she added.

Read more at the WSJ

“Heat Dome” Extra-Hot Weather Expected This Week Across the Nation

Meteorologists are warning a heat dome will park itself over parts of the country, pushing temperatures into the 90s and 100s for many cities. More than 100 high temperature records could be broken this week in cities around the U.S.. New York has a 40 -50% chance of experiencing above normal temperatures.

The National Weather Service posted a forecast map to Twitter Sunday that shows nearly every corner of the country covered in shades of orange and red, indicating high probabilities of above-normal temperatures. “Colors we have not seen for awhile,” the agency said.

DiNapoli: Local Sales Tax Collections Grew by Nearly 17% in May

Local sales tax collections in New York state increased by 16.7% in May compared to the same month in 2021, according to an analysis released today by State Comptroller Thomas P. DiNapoli. Overall, local collections totaled $1.7 billion, up $242 million from May of last year.

New York City’s collections totaled $720 million, an increase of 13.3% — or $84.6 million — when compared to May of 2021. Every county also experienced double-digit growth in collections, at least partially due to recent high inflation, including soaring gas prices. Monthly sales tax distributions made to counties and tax-imposing cities are based on estimates by the Department of Taxation and Finance.

Read more at the Comptroller’s website

VW U.S. Chief Warns of Industry Challenges with EV Battery Shift

Volkswagen AG’s top U.S. executive said on Thursday the United States faces major challenges in ramping up battery production to facilitate a shift to electric vehicles including attracting skilled workers, mining for key metals and supply chain issues. Scott Keogh, chief executive of Volkswagen Group of America, told an Automotive News forum in Washington that the move to EVs is the single biggest “industrial transformation in America.”

Automakers and battery companies are committing tens of billions of dollars to building new battery plants and EV assembly plants throughout North America as they scale up electric vehicle production. This move requires the United States to overcome a series of challenges, Keogh said. These challenges include attracting enough skilled workers, dramatically boosting and facilitating U.S. mining for critical minerals to produce the lithium batteries for EVs, supply chain issues and more broadly addressing healthcare, education and infrastructure.

Read more at Reuters

France Faces 5 Years of Gridlock After Macron’s Stunning Parliamentary Defeat

French President Emmanuel Macron is set to face a potentially tumultuous five years of deadlock after his centrist alliance fell short of an absolute majority in a parliamentary runoff on Sunday, just weeks after he was reelected to the Elysée.

Voters massively came out in support of the far-right National Rally and the left-wing coalition NUPES, depriving Macron of a ruling majority. Macron’s Ensemble coalition has won 245 seats, down from 345 in the outgoing chamber, according to final results. NUPES, led by the far-left firebrand Jean-Luc Mélenchon got 131 seats, while Marine Le Pen’s National Rally walks away with 89 seats.

Read more at Politico

In Colombia Left-Wing Candidate and Former Guerrilla Gustavo Petro Wins Presidential Election

Gustavo Petro will become Colombia’s first leftist leader, after winning the country’s presidential race on Sunday. The former guerrilla won by a slim margin with over 50% of the votes, against 77-year-old entrepreneur Rodolfo Hernandez. In this historic win, his running mate Francia Marquez will now become the first Afro-Colombian to hold executive powers.

Sunday’s run-off vote suggests that Petro has finally overcome the hesitation of voters who once saw him a radical left-wing outsider — no small feat for a politician looking to win over one of South America’s most conservative countries. The support Petro has garnered can be partially attributed to Colombia’s worsening socioeconomic situation, including deteriorating living conditions, made worse by the impact of the Covid-19 pandemic and the impact of the war in Ukraine.

Maryland Apple Workers Face Hurdles After Vote to Unionize

Apple store employees in a Baltimore suburb voted to unionize by a nearly 2-to-1 margin Saturday, joining a growing push across U.S. retail, service and tech industries to organize for greater workplace protections. The Apple retail workers in Towson, Maryland, voted 65-33 to seek entry into the International Association of Machinists and Aerospace Workers, the union’s announcement said.

The National Labor Relations Board now has to certify the outcome. A spokesperson referred initial queries about the vote to the board’s regional office, which was closed late Saturday. Even after a union is certified, a company has a number of legal maneuvers at its disposal to fight it, Duff said. For instance, Apple could say it doesn’t believe that the bargaining unit certified by the NLRB is an appropriate bargaining unit. and refuse to bargain with the union.

Read more at the AP

RCC Elevates Susan Deer & Katherine Lynch While College Seeks New President

Rockland Community College is conducting a national search for the eighth president. Dr. Michael A. Baston has accepted a new position as President of Cuyahoga Community College located in Cleveland, Ohio and will be stepping down from his position as RCC president in July 2022.

While the college’s leadership transitions and undertakes a search for Baston’s replacement, RCC’s Board of Trustees will vote this week to appoint Dr. Susan Deer as Officer in Charge at the meeting on June 27, 2022. Deer will be responsible for leadership, oversight, and supervision for all areas of the college, according to RCC. The Trustees will also vote to appoint Dr. Katherine Lynch as Officer in Charge of Academic Affairs. Lynch will report to Deer and serve on the Executive Cabinet. Lynch will provide administrative leadership and direction for academic activities and faculty affairs at the college.

Central Hudson’s Electric and Gas Bill Relief Program Approved

Central Hudson Gas & Electric Corp. is implementing the Electric & Gas Bill Relief Program, approved by the State Public Service Commission, to assist low-income families and individuals throughout the state who experienced hardship during the COVID-19 pandemic.

Residential utility customers who receive income-qualified government assistance for utility bills and other expenses and have past-due balances for service through May 1, 2022, will have those balances forgiven through a bill credit. Customers who qualify for this program remain responsible for charges incurred after May 1.

American Airlines Ending Service to Two New York Cities Due to Pilot Shortage

American Airlines will eliminate service for three cities following the Labor Day holiday weekend as a result of staffing shortages, marking the latest hiccup for the airline industry amid thousands of cancellations and cuts in recent months. An airline spokesperson said the company will drop service to Toledo, Ohio; Ithaca, N.Y.; and Islip, N.Y., on Sept. 7 in response to a “regional pilot shortage.”

Travel demand has surged. The Transportation Security Administration said it screened about 2.44 million people at airports on Friday, a total greater than any other day since Nov. 28, 2021. Meanwhile, airlines have struggled to keep up with rising demand after shedding millions of jobs at the height of the pandemic, driving prices higher.

Read more at The Hill

Daily Briefing – 527

Post: Jun. 19, 2022

NAM Survey: Inflation, Recession Signs Worry Manufacturing Leaders, But Optimism Remains

The National Association of Manufacturers Q2 2022 Manufacturers’ Outlook Survey shows manufacturers’ significant concerns around recession, inflation, hiring and China competition legislation. The NAM conducted the survey May 17–31, 2022. Here are some key Findings:

59.3% of manufacturing leaders believed inflationary pressures would make a recession more likely in the next 12 months.
Increased raw material costs topped the list of primary business challenges in the second quarter, cited by 90.1% of respondents.
Three-quarters of manufacturers felt inflationary pressures were worse today than six months ago.
The top sources of inflation were increased raw material prices (97.2%), freight and transportation costs (83.9%), wages and salaries (79.5%) and energy costs (55.9%), with 49.4% also citing a shortage of available workers.
When asked about what aspects of the China competition legislation were most important for supporting manufacturing activity, 70.9% of respondents cited addressing port congestion and competition issues in shipping.
Despite ongoing economic headwinds, manufacturers remain largely optimistic, with 82.6% of respondents maintaining a positive outlook for their company.

War in Ukraine Headlines

U.S. Industrial Production Eased in May, Adding to Signs of Economic Slowdown

Total industrial production moved up 0.2 percent in May, Output has increased in every month of the year so far, with an average monthly gain of nearly 0.8 percent. The indexes for utilities and mining rose 1.0 percent and 1.3 percent, respectively. At 105.7 percent of its 2017 average, total industrial production in May was 5.8 percent above its year-earlier level. Capacity utilization edged up to 79.0 percent, 0.5 percentage point below its long-run (1972–2021) average.

Manufacturing output slipped 0.1 percent in May; even so, the index has advanced 4.8 percent over the past 12 months. In May, the index for nondurable manufacturing moved up 0.1 percent, while the indexes for durable manufacturing and for other manufacturing (publishing and logging) each moved down 0.2 percent. The easing of industrial output added to signs of an economic slowdown.

U.S. Economic Growth Shows Signs of Slipping

he U.S. economy is starting to slow under the combined weight of soaring inflation and climbing interest rates—including the highest mortgage rates since 2008. Economists have slashed their projections for second-quarter output growth in recent days. One closely watched forecast—the Federal Reserve Bank of Atlanta’s GDPNow tracker—estimates that gross domestic product is on track to remain unchanged at an annual rate over the three months through June 30. Output fell at a 1.5% annual rate in the first quarter.

Recent reports show sharp declines in key sectors, raising the prospects of a stalled economic recovery and possibly a recession. Home construction across the U.S. fell sharply in May, the Commerce Department said Thursday. Factories in the mid-Atlantic region reduced activity for the first time in two years this month, the Federal Reserve Bank of Philadelphia said. And Americans broadly cut spending at retailers for the first time this year in May, the Commerce Department said earlier this week.

Read more at the WSJ

US COVID – Hospitalizations Begin to Taper

The US CDC is reporting 85.7 million cumulative cases of COVID-19 and 1,007,374 deaths. The average daily incidence has plateaued over the past several weeks, holding relatively steady at approximately 100-110,000 new cases per day. Despite the ongoing elevated daily incidence, there has not observed a corresponding increase in daily mortality. Daily mortality has held relatively steady at approximately 275-325 deaths per day since late April.

Despite the absence of a surge in COVID-19 mortality, both new hospital admissions (+6.5% over the past week) and current hospitalizations (+1.8%) continue to increase. Notably, both trends appear to be tapering off to some degree. Considering the plateau in daily incidence, it is possible that hospitalizations could also remain elevated, rather than peaking and then declining. Community transmission in the US continues to be driven by the BA.2.12.1 sublineage of Omicron (64.2%), followed by BA.2 (14.2%), BA.5 (13.3%), and BA.4 (8.3%).

NYS Vaccine and COVID Update –

Vaccine Stats as of June 17:

One Vaccine Dose

90.9% of all New Yorkers – 16,651,966
In the Hudson Valley 1,732,322

Fully Vaccinated

77.6% of all New Yorkers – 14,943,680
In the Hudson Valley – 1,527,264

Boosters Given

All New Yorkers – 8,720,979
In the Hudson Valley – 1,060,324

The Governor updated COVID data through June 17. There were 13 COVID related deaths for a total reported of 71,670

Hospitalizations:

Patients Currently in Hospital statewide: 1,842
Patients Currently in ICU Statewide: 211

7 Day Average Positivity Rate – Cases per 100K population

Statewide 5.48% – 24.98 positive cases per 100,00 population
Mid-Hudson: 5.99% – 25.13 positive cases per 100,00 population

Useful Websites:

The FDA, CDC Authorizes COVID-19 Shots for Infants and Preschoolers

U.S. regulators on Friday authorized the first COVID-19 shots for infants and preschoolers, paving the way for vaccinations to begin this week. The Food and Drug Administration’s action follows its advisory panel’s unanimous recommendation for the shots from Moderna and Pfizer. That means U.S. kids under 5 — roughly 18 million youngsters — are eligible for the shots. The nation’s vaccination campaign began about 1 1/2 years ago with older adults, the hardest hit during the coronavirus pandemic.

An independent panel of advisers to the U.S. Centers for Disease Control and Prevention voted on Saturday to recommend vaccinating all children in the age group with one of two separate COVID-19 vaccines manufactured by Moderna and Pfizer-BioNTech. The CDC advisory panel voted 12-0 in favor of recommending both vaccines for this group of children, concluding that both vaccines protect children in this age group against symptomatic COVID-19, and the benefits outweigh possible risk.

Vaccines Will Be Widely Available Statewide for Young Children

In addition to currently drafting guidance that will soon be shared with providers, New York State has already taken important steps to prepare for the rollout of vaccines to children under the age of five. State providers from outside of New York City have placed preliminary orders for over 39,000 dosages, and the State Department of Health is working to ensure providers across the state will be able to request additional doses.

Vaccines for children down to six months of age will be widely available statewide, including through pediatricians, family physicians, local county health departments, federally qualified health centers, and pharmacies enrolled in the Federal Retail Pharmacy Program.

Read the press release

What Should Parents Know About Vaccines for Kids Under 5?

Nearly 40% of those surveyed said they would “wait and see” before vaccinating their young children, 11% said they would get the vaccine for their kids only if required, and 27% said they would “definitely not” get the Covid-19 vaccination for their child.

Even parents who are eager to vaccinate likely have questions. This Q&A with CNN Medical Analyst Dr. Leana Wen offers some information. She is an emergency physician and professor of health policy and management at the George Washington University Milken Institute School of Public Health. She is also author of “Lifelines: A Doctor’s Journey in the Fight for Public Health” and the mother of two children under 5.

NYS Economy Added 27,200 Private Sector Jobs in May 2022

According to preliminary seasonally adjusted figures released by the New York State Department of Labor, the number of private sector jobs in New York State increased by 27,200 in May and over the last 12 months by 435,500 or 5.3%, to 8,008,500. New York State’s seasonally adjusted unemployment rate decreased from 4.5% to 4.4% in May 2022.

In the Hudson Valley Region over the past year, the private sector jobs count rose by 21,300, or 2.8 percent, to 781,700 in May 2022. Growth was centered in leisure and hospitality (+9,000), other services (+4,400), and professional and business services (+4,100). Manufacturing added 1,500 workers.

Hudson Valley Labor Market Profile May 2022

US Jobless Claims Total Higher-Than-Expected 229,000 Last Week

Initial jobless claims ticked down last week, but were higher than forecast, as investors monitor the labor market for potential signs of a slowdown. First-time filings for unemployment insurance in the U.S. totaled 229,000 for the week ended June 11, falling from the prior week’s upwardly revised 232,000, the Department of Labor said Thursday. Economists surveyed by Bloomberg had expected the latest reading to come in at 217,000.

Last week’s figure held near the highest level since mid-January when the Omicron-driven wave of COVID-19 sent droves of employees home from work. The most recent data also brings the four-week moving average for new claims — which smooths out volatility in the weekly data — to 1,317,500, a decrease of 750 from the previous week’s revised average. This marks the lowest level for this average since January 1970.

Read more at YahooFinance

New York Court Overturns State Assembly Map for 2024; Rules Existing Boundaries be Used for This Year’s Elections

An appellate division of the New York Supreme Court ruled on June 10 that the state’s Assembly district boundaries adopted in February 2022 were invalid but should still be used for the 2022 legislative elections. The appellate division ruling determined that the Assembly district map was enacted in violation of the state’s constitutional redistricting process and that a New York City-based state trial court should oversee new boundaries for the 2024 elections.

The order also said, “The request for a delay of the 2022 assembly primary elections is denied in any event, because the redrawing and implementing of a new assembly map before a 2022 primary election delayed even until September is, at this late date, no longer feasible.”

Race for New York Governor Nominations Enters Final Stretch

Seven candidates, 62 counties, one state: The Republicans and Democrats vying for their parties’ nomination are entering a final 10-day stretch starting with early voting Saturday and culminating on June 28. On the Democratic side, Gov. Kathy Hochul is working to cement her place on the ballot after she quickly amassed most of the institutional support in New York state politics following the resignation of Andrew Cuomo last year. She’s being challenged by Long Island Rep. Tom Suozzi and New York City Public Advocate Jumaane Williams.

For the Republicans, Rep. Lee Zeldin of Long Island is fending off three challengers after he received his party’s preferred designation status: former Westchester County Executive Rob Astorino, former Trump administration official Andrew Giuliani and businessman Harry Wilson.

Read more at State of Politics

Large Gap in Pay and Contentment Levels for Working Women

Grant Thornton talked to 2,800 American women in the workforce to find out their views on a number of topics. While the report found an increase in the proportion of women in senior management around the globe, it’s not much as it moved from 31% in 2021 to 32% in 2022. Looking at the number over the past 10 years, it has risen from 21% in 2012.

But it’s the gap in pay and job contentment that is most surprising. Fewer than half (49%) of women feel they are paid fairly for their contributions to their company’s success. This is compared to 62% of men who believe they are fairly paid. However, the numbers improve when it comes to work-life balance with 55% of women reporting they are happy with their work-life balance versus 64% of men.

Read more at EHS Today

Abbot Baby Formula Plant Halts Production Again – This Time Due to Flooding

Abbott Nutrition has once again shut down a baby formula plant, this time due to heavy rains and flooding, less than two weeks after it reopened to try and mitigate a crippling U.S. shortage. The facility in Sturgis, Michigan resumed production on June 4, only to close down again earlier this week so the company could assess rain damage.

In the statement Wednesday, the manufacturer assured consumers that it had “ample existing supply” of EleCare and most of its other specialty formulas to meet demand until production could resume again. “This will likely delay production and distribution of new product for a few weeks.”

Read more at IndustryWeek

UN: Food Crisis Could Drive Record Displacements Higher

Filippo Grandi, the U.N. High Commissioner for Refugees, called for more efforts to build peace in the world as conflicts and crises like those in Ukraine, Venezuela, Myanmar, Syria and beyond have driven over 100 million people to leave their homes — both within their own countries and abroad.

UNHCR, the U.N.’s refugee agency, on Thursday issued its latest “Global Trends” report, which found over 89 million people had been displaced by conflict, climate change, violence and human rights abuses by 2021. The figure has since swelled after at least 12 million people fled their homes in Ukraine to other parts of the country or abroad following Russia’s Feb. 24 invasion.

Read more at the AP

Juneteenth: Factory Jobs and Opportunity

Yesterday and today the nation is celebrating Juneteenth. The newest federal holiday offers our country a moment to commemorate the end of slavery in the United States and reflect on the work that remains to create equity for all Americans. That includes manufacturing, a sector that traditionally offered a path to the middle class for Black Americans and other workers of color. Unfortunately, when factories were offshored starting in the late 20th century, workers of color also suffered the most.

But now our nation is at a unique moment. We’re about to rebuild our infrastructure, the clean energy sector is growing at a rapid rate, and there’s momentum to bring supply chains home. The Alliance for American Manufacturing explains in a new video how the United States can seize this moment to create millions of new, well-paid jobs for American workers, begin to close racial wealth gaps, and offer new opportunities for Black workers and other workers of color.

Watch the video (2:27)

Beijing and Shanghai are Still Trying to Get a Grip on COVID-19

Since june 1st, when the authorities in Shanghai lifted a months-long lockdown, many aspects of life in the city have returned to normal. But Shanghai’s officials are still on edge. Many residential communities reopened only to be locked down again when a positive case, or merely a close contact of one, was found in their vicinity. Residents continue to be taken away to quarantine centres if they live in the same building as someone infected.

This is what the new version of China’s “dynamic zero-covid” campaign looks like. “Micro-lockdowns” and mass testing are meant to replace economically destructive citywide closures. The strategy is supposed to be more targeted, finding and quarantining cases and their close contacts quickly. But calibration is proving difficult.

Read more at The Economist

Daily Briefing – 526

Post: Jun. 15, 2022

Fed Raises Rates By 0.75 Percentage Point, Largest Increase Since 1994

The Federal Reserve approved the largest interest rate increase since 1994 and signaled it would continue lifting rates this year at the most rapid pace in decades as it races to slow the economy and combat inflation. Officials agreed to a 0.75-percentage-point rate rise at their two-day policy meeting that concluded Wednesday, which will increase the Fed’s benchmark federal-funds rate to a range between 1.5% and 1.75%.

New projections showed all 18 officials who participated in the meeting expect the Fed to raise rates to at least 3% this year. Most officials now see growth of around 1.7% this year and next, compared to projections in March that showed growth rising by 2.8% this year and 2.2% in 2023. The projections revealed that all but one official expects the unemployment rate to rise over the next two years, an implicit acknowledgment of rising recession risks. The median projection showed the unemployment rate, which stood at 3.6% in May, ending at 3.7% this year before rising to 4.1% in 2024.

Read more at the NY Fed

War in Ukraine Headlines

IEA: Oil-Supply Growth Expected to Lag Behind Demand Next Year

Global demand for oil will rise above pre-pandemic levels next year following three years of Covid-19 lockdowns and the economic shock of the Ukraine war, the International Energy Agency said. Much of the growth in demand next year will be driven by China, as it emerges from stop-start Covid-19 lockdowns, while developed economies are expected to contend with a worsening economic outlook and rampant inflation.

Meanwhile, the IEA expects supply growth to lag behind demand, pushing an already tight market witnessing soaring prices into a 500,000-barrel-a-day deficit. U.S. oil producers are expected to underpin supply increases next year, while members of the Organization of the Petroleum Exporting Countries are seen continuing to struggle to meet their output targets.

Read more at the WSJ

China’s Factories Perk Up

China’s economy showed signs of recovery in May after slumping in the prior month as industrial production rose unexpectedly. The data, however, provides a path to revitalise growth in the world’s second-biggest economy after businesses and consumers were hit hard due to full or partial lockdowns in dozens of cities in March and April, including a protracted shutdown in commercial centre Shanghai.

Industrial output grew 0.7% in May from a year earlier, after falling 2.9% in April, data from the National Bureau of Statistics (NBS) showed on Wednesday. The uptick in the industrial sector was underpinned by the easing of COVID curbs and strong global demand. China’s exports grew at a double-digit pace in May, shattering expectations, as factories restarted and logistics snags eased.

Read more at Reuters

US COVID – Newest Omicron Covid-19 lineages gaining ground in United States

The United States appears to be in the midst of another biological baton pass between Covid-19 variants. The Omicron lineage BA.2 and its spinoff, BA.2.12.1, drove cases this spring, building into waves of infections in places like the Northeast and parts of California. Now, two other forms of Omicron, BA.4 and BA.5, are eating into the BA.2 group’s dominance.

More than 1 in 5 Covid-19 infections last week were caused by BA.4 and BA.5, according to updated estimates posted Tuesday by the Centers for Disease Control and Prevention. That’s up from 13% the week prior. The rest of the cases are from the BA.2 lineages.

NYS Vaccine and COVID Update –

Vaccine Stats as of June 10:

One Vaccine Dose

90.7% of all New Yorkers – 16,636,019
In the Hudson Valley 1,730,396

Fully Vaccinated

77.5% of all New Yorkers – 14,928,944
In the Hudson Valley – 1,525,547

Boosters Given

All New Yorkers – 8,648,496
In the Hudson Valley – 1,049,605

The Governor updated COVID data through June 10. There were 17 COVID related deaths for a total reported of 71,670

Hospitalizations:

Patients Currently in Hospital statewide: 2,009
Patients Currently in ICU Statewide: 210

7 Day Average Positivity Rate – Cases per 100K population

Statewide 5.41% – 30.31 positive cases per 100,00 population
Mid-Hudson: 5.44% – 28.17 positive cases per 100,00 population

Useful Websites:

June Empire State Manufacturing Survey – Steady On

After declining last month, manufacturing activity held steady in New York State. Optimism about future conditions was subdued for a third consecutive month. Delivery times are expected to decline over the next six months, as are unfilled orders, while increases in prices and employment are expected to continue in the months ahead. Capital spending and technology spending plans remained firm.

The general business conditions index climbed ten points to -1.2. Twenty-eight percent of respondents reported that conditions had improved over the month, and twenty-nine percent reported that conditions had worsened.
The new orders and shipments indexes climbed into positive territory, pointing to a small increase in both areas.
The unfilled orders index fell to -4.3 indicating that unfilled orders shrank.
The delivery times index fell six points to 14.5, suggesting that delivery times lengthened.
The inventories index rose nine points to 17.1, indicating that inventories expanded.
The index for number of employees increased five points to 19.0, pointing to a solid increase in employment,
and the average workweek index came in at 6.4, indicating a small increase in hours worked.
The prices paid index rose five points to 78.6, several points below its recent record high,
The prices received index edged down to 43.6, signaling ongoing substantial increases in both input and selling prices.
The index for future business conditions fell four points to 14.0.

Read more at the NY Fed

CEO Confidence Falls To Decade Low, But Few Predict Recession

Nearly 300 U.S. CEOs participated in Chief Executive’s CEO Confidence Index poll, sharing their prospect of the U.S. economy and business landscape. While their ratings of current business conditions remained flat month-over-month, at 6.4 out of 10, their forecast for business 12 months from now dropped another 6 percent, down to 5.6/10 from 5.9/10 in May.

That reading is now 20 percent off where it was at the beginning of the year when CEOs told us they were increasingly hopeful that persistent issues in the supply chain and growing inflation—and even Covid-19—would wind down this year. It is the lowest level it’s been since January 2013, on the heels of the “Fiscal Cliff” drama in Washington and ahead of further debt ceiling negotiations.

Retail Sales Fall 0.3% in May From June as Surging Inflation Crimps Spending on Non-Essentials

Retail spending fell 0.3% in May, the Commerce Department said Wednesday, amid high inflation, rising interest rates and weakening consumer confidence. Interest rates look set to rise further, a potential damper on consumer spending in the months ahead as car loans and credit-card debt get more expensive.

So far this year, consumer spending has broadly held up, according to government data through April. Consumer spending accounts for about 70% of U.S. economic output. A strong labor market and rising wages are helping to support spending on services, for which there is pent-up demand from the pandemic. A number of factors are contributing to the expected moderation in retail spending. Consumers are continuing to shift spending to services from goods as many Americans resume more in-person activities such as travel and dining out.

Read more at YahooFinance

China Consumption Weak in May

China’s consumers bought less in May. Consumption was weak and underlined the challenge for policymakers amid the persistent drag from strict COVID curbs. Retail sales slipped another 6.7% in May from a year earlier, on top of a 11.1% contraction the previous month. They were slightly better than the forecast of a 7.1% fall due to the increased spending on basic goods such as grains, edible oils and food and beverages.

“We should not be overly optimistic about consumption as the recovery has been quite slow. Affected by repeated COVID outbreaks, slower income growth, a cautious view of the future expectations, there will not be a revenge spending, as people have expected,” said Wang Jun, chief economist at Zhongyuan Bank.

Read more at Reuters

Home Builder Sentiment Hits Two-Year Low in June – NAHB

Confidence among U.S. single-family homebuilders dropped to a two-year low in June as high inflation and rising mortgage rates reduced affordability for entry-level and first-time buyers, a survey showed on Wednesday. The survey’s measure of current sales conditions slipped one point to 77. Its gauge of sales expectations over the next six months dropped two points to 61.

The National Association of Home Builders/Wells Fargo Housing Market index fell two points to 67 this month, the lowest reading since June 2020. It was the sixth straight monthly decline in the index. A reading above 50 indicates that more builders view conditions as good rather than poor.

Read more at Reuters

U.S. Home Equity Hits Highest Level on Record—$27.8 Trillion

Total U.S. home equity increased almost 20% in the first quarter to $27.8 trillion, a record high, according to the Federal Reserve. The increase is another consequence of a red-hot housing market. Double-digit price gains have driven some would-be homeowners out of the market. At the same time, rising home values are boosting the finances of the Americans who already own them.

Still, rising rates have made it more expensive for homeowners to use that equity, the difference between the market value of a property and the mortgage balance. About 60% of equity was withdrawn via cash-out refinances in 2021, according to mortgage-data firm Black Knight.

Read more at the WSJ

After Emergency Meeting ECB to Devise New Tool to Tackle Rising Borrowing Costs in Weaker Economies

The European Central Bank will skew reinvestments of maturing debt to help more indebted members and will devise a new instrument to stop fragmentation, it said on Wednesday, seeking to temper a market rout that has fanned fears a new debt crisis. Government bond yields have soared on the 19-country currency bloc’s periphery since the ECB unveiled plans last Thursday to raise interest rates in July and September to tame painfully high inflation that is at risk of becoming entrenched.

“The Governing Council decided that it will apply flexibility in reinvesting redemptions coming due in the PEPP portfolio, with a view to preserving the functioning of the monetary policy transmission mechanism,” the ECB said after a rare unscheduled meeting.

Read more at Reuters

NAM Pushes Back on Interest Deductibility

A congressional proposal to limit interest expensing would be damaging for manufacturers, according to a new study. A recent analysis prepared by EY’s Quantitative Economics and Statistics group found that the proposed interest expense limitations would cost about:

623,000 jobs,
$31.6 billion in annual employee compensation, and
$60.1 billion in annual GDP.

“Manufacturers are already facing incredible economic headwinds due to increased input costs, labor shortages and strong inflationary pressures,” said NAM VP of Tax and Domestic Economic Policy Chris Netram. “This analysis shows that limiting tax deductions for interest on business loans disproportionately harm manufacturers at a perilous time – costing hundreds of thousands of jobs and billions of dollars in economic growth at a time when our industry is trying to drive our nation’s recovery.”

Labor, Maritime Leaders Talk Earlier Port Hours

Negotiators with the International Longshore and Warehouse Union and the Pacific Maritime Association are discussing a plan to allow all West Coast marine terminals to open an hour earlier, at 6 a.m., under what’s called “a double flex.” This point is one of several under discussion now in San Francisco as ILWU and PMA are in the midst of negotiations for a new, multiyear contract covering some 22,000 workers at 29 locations in California, Washington and Oregon.

The current contract is set to expire July 1 and under that agreement, the existing work shifts are 8 a.m. to 5 p.m., 6 p.m. to 3 a.m., and the overnight “hoot” shift runs from 3 a.m. to 8 a.m. However, provisions in the pact allow terminal operators to “flex” the start times by one hour, to 7 a.m., but currently not by two hours.

European Natural-Gas Prices Jump as Russia Cuts Supplies Again

Europe’s options for filling its natural-gas stores and avoiding a winter energy crisis are narrowing as flows from Russia decrease and U.S. shipments are poised to stall, sending gas prices higher. Russia’s Gazprom PJSC said Wednesday that flows through the Nord Stream pipeline to Germany would fall further, a day after it cut exports on the route by 40%. Gazprom also cut the volume of gas sent to Italy by 15% compared with Tuesday. Italian gas and oil company Eni, the country’s biggest importer of Russian gas, said Gazprom gave no explanation for the cut.

Benchmark European gas prices jumped 18% Wednesday to 114.25 euros, or $118.87, a megawatt-hour as traders assessed the threat to supply. The market has rallied 44% over the past week, pushing prices to more than four times their level from a year ago. U.S. natural-gas futures rose 4.3% to $7.50 per million British thermal units.

Read more at the WSJ

Daily Briefing – 525

Post: Jun. 14, 2022

NFIB: Small Business Owners’ Expectations for the Future at 48-year Low

The NFIB Optimism Index fell 0.1 points in May to 93.1, marking the fifth consecutive month below the 48-year average of 98. Owners expecting better business conditions over the next six months decreased four points to a net negative 54%, the lowest level recorded in the 48-year-old survey. Expectations for better business conditions have deteriorated every month since January.

Twenty-eight percent of owners reported inflation was their single most important problem in operating their business, a decrease of four points from April.
The net percent of owners raising average selling prices increased two points to a net 72% (seasonally adjusted), back to the highest reading in the 48-year-history of the survey last reached in March and 32 points higher than May 2021.
Fifty-one percent of owners reported job openings that could not be filled, up four points from April.
The net percent of owners who expect real sales to be higher decreased three points from April to a net negative 15%.
A net 46% (seasonally adjusted) of owners reported raising compensation, down three points from April with a net 25% planning to raise compensation in the next three months, down two points from April but historically high.
Thirty-nine percent of owners report that supply chain disruptions have had a significant impact on their business, up three points. Another 31% report a moderate impact and 22% report a mild impact. Only 8% of owners report no impact from the recent supply chain disruptions.

War in Ukraine Headlines

10.8 Percent – PPI Up Again Solidly in May

The producer price index for final demand rose 0.8% last month after advancing 0.4% in April, the Labor Department said on Tuesday. In the 12 months through May, the PPI increased 10.8% after accelerating 10.9% in April. Excluding the volatile food, energy and trade services components, producer prices rose 0.5% in May. The so-called core PPI gained 0.4% in April. In the 12 months through May, the core PPI increased 6.8% after rising by the same margin in April.

With inflation far exceeding the Federal Reserve’s 2% target by all measures and pressuring consumers, risks of the economy stagnating or plunging into recession next year are growing. Fed officials are expected to raise interest rates today for a third time this year, with a three-quarters-percentage point increase now seen as the likely outcome and the possibility of signals for more large hikes to combat inflation.

Read more at the WSJ

Dollar at Two-Decade High as Risky Assets Sell Off; Yen Recovers Ground

The safe-haven U.S. dollar rose to a fresh two-decade high against a basket of currencies on Monday, supported by fears of a global economic slowdown and bets on steep interest rate hikes by the U.S. Federal Reserve. Global financial markets continued to smart from Friday’s hotter-than-expected U.S. inflation data that led to a broad-based rise in risk aversion and fuelled bets on even more aggressive policy tightening.

The U.S. Dollar Currency Index , which tracks its performance against six other major currencies, was up 0.6% at 105.04, after scaling its highest since December 2002.The battered Japanese yen, floundering near lows against the dollar not seen since 1998, was one major currency that advanced against it on Monday.

Read more at Reuters

US COVID – Pediatric Vaccines

last week, the Biden Administration outlined its SARS-CoV-2 vaccination plans for children under 5 years of age. The current estimates suggest that up to 18 million children may become eligible for SARS-CoV-2 vaccination once the US FDA authorize existing vaccines for emergency use in younger children. The White House has allocated 10 million doses for states to distribute to dispensing sites. Notably, the White House estimates that 85% of the newly eligible pediatric population lives within 5 miles of one of these sites. The allotment of vaccines is approximately even between the Pfizer-BioNTech and Moderna vaccines.

Despite a ready supply of vaccines and a plan to make them accessible to a large number of children in this age group, questions remain regarding the willingness of parents and caretakers to get the children vaccinated. In the age group of children from 5-11 years, only one-third of eligible children have received the vaccine.

NYS Vaccine and COVID Update –

Vaccine Stats as of June 10:

One Vaccine Dose

90.7% of all New Yorkers – 16,636,019
In the Hudson Valley 1,730,396

Fully Vaccinated

77.5% of all New Yorkers – 14,928,944
In the Hudson Valley – 1,525,547

Boosters Given

All New Yorkers – 8,648,496
In the Hudson Valley – 1,049,605

The Governor updated COVID data through June 10. There were 17 COVID related deaths for a total reported of 71,670

Hospitalizations:

Patients Currently in Hospital statewide: 2,009
Patients Currently in ICU Statewide: 210

7 Day Average Positivity Rate – Cases per 100K population

Statewide 5.41% – 30.31 positive cases per 100,00 population
Mid-Hudson: 5.44% – 28.17 positive cases per 100,00 population

Useful Websites:

COVID and Smell Loss: Answers Begin to Emerge

Researchers are finally making headway in understanding how the SARS-CoV-2 coronavirus causes loss of smell. And a multitude of potential treatments to tackle the condition are undergoing clinical trials, including steroids and blood plasma.

Early in the pandemic, a study showed3 that the virus attacks cells in the nose, called sustentacular cells, that provide nutrients and support to odor-sensing neurons. Since then, clues have emerged about what happens to the olfactory neurons after infection. Researchers including biochemist Stavros Lomvardas at Columbia University in New York City examined people who had died from COVID-19 and found that, although their neurons were intact, they had fewer membrane-embedded receptors for detecting odor molecules than usual.

Update on New York’s Unemployment Insurance Trust Fund: Challenges Continue

While many states had to borrow from the federal government to support UI claims, New York is one of only seven states or territories with UI funds that continue to be in debt to the federal government, and the size of the outstanding loan balance—$8.1 billion—is second only to California.

In May 2022, New York State paid $1.2 billion of its federal loan, but New York’s UI debt has remained stubbornly high despite steady employment gains and State tax rates that have already increased to maximum permissible levels. If New York’s outstanding balance is not fully repaid by November 10, 2022, interest costs will mount, as will the federal portion of employers’ 2022 tax bills. Absent any significant federal or State action, employer costs will continue to grow, potentially impeding the State’s employment recovery amid growing economic uncertainty.

Hochul, Zeldin Hold Double-Digit Leads in NY Governor Primaries: Poll

Gov. Kathy Hochul (D-N.Y.) and Rep. Lee Zeldin (R-N.Y.) hold double-digit leads in their parties’ respective New York gubernatorial primaries, according to an Emerson College Polling-PIX11-The Hill poll released Monday. Hochul, who replaced former Gov. Andrew Cuomo (D) last year after he resigned in disgrace, leads the field with 57 percent support among very likely Democratic primary voters. Rep. Tom Suozzi follows with 17 percent, and New York City Public Advocate Jumaane Williams comes in third with 6 percent. Another 20 percent say they are undecided. Of those who say they are undecided, 42 percent lean toward Suozzi, while 32 percent lean toward Hochul and 26 percent lean toward Williams.

On the Republican side, Zeldin leads the field with 34 percent support among very likely GOP primary voters. He is trailed by former Westchester County Executive Rob Astorino with 16 percent, businessman Harry Wilson at 15 percent and Andrew Giuliani, the son of former Mayor Rudy Giuliani (R), with 13 percent. Another 22 percent are undecided.

Read more at The Hill

Amazon to Deliver Packages by Drone, After a Decade of Promises

On Monday, Amazon announced that customers in Lockeford, Calif., will be “among the first to receive Prime Air deliveries.” In an appearance on the TODAY Show, Amazon said it plans to deliver packages weighing less than five pounds within an hour, using drones ferrying items from a facility roughly 15 miles away. The FAA did not immediately respond to requests for comment on Monday’s announcement.

The drones — which have the ability to identify fixed objects in its flight path — will “descend to the customer’s backyard, and hover at a safe height,” the company said in a blog post, adding “it will then safely release the package and rise back up to altitude.”

Read more at Politico

Larry Summers Sees Likely U.S. Recession in Next 2 Years

“When inflation is as high as it is right now and unemployment is as low as it is right now, it’s almost always followed within two years by recession,” Summers said on CNN’s State of the Union, Bloomberg reported. Regarding inflation, “the Fed’s forecasts have tended to be much too optimistic there, and I hope they’ll realize fully the gravity of the problem,” he said. Summers, who has predicted severe inflation since last year, said that a recession will “more likely than not” occur within the next two years, if not this year.

Former Federal Reserve Chair Ben Bernanke said Sunday that the Fed has a “decent chance” of averting recession and orchestrating a “soft-ish landing” for the economy. Such a landing, however, would depend on supply-side inflation pressures improving, Bernanke said on CNN’s Fareed Zakaria GPS, Bloomberg reported.

Read more at Fortune

Bernanke: Great Inflation of the 1960s and ’70s ‘Almost Certainly’ Won’t be Repeated

Former Federal Reserve chair Ben Bernanke wrote in an opinion piece published Tuesday that despite current high inflation, the U.S. is likely not in danger of repeating the experiences of the 1960s and 1970s. Bernanke wrote in The New York Times that while inflation in recent months “evokes memories of America’s Great Inflation of the 1960s and ’70s,” the country is “almost certainly not” heading for a repeat of that era.

Bernanke admitted that the current economic situation had some similarities to the past, such as heavy federal spending and shocks on global energy and food prices, but he wrote that there are critical differences as well.

The former Federal Reserve chair said that inflation was met with “stiff political resistance” in the past, first using former President Lyndon Johnson as an example.

Read more at The Hill

LA Port Braces for Peak Cargo Season to Arrive Early as Consumers Keep Buying

The Port of Los Angeles, the US’s busiest, is preparing for the early arrival of the 2022 peak season for cargo as retailers stock up on back-to-school and fast-fashion products despite high inventory levels, Executive Director Gene Seroka said. Retailers have been building up inventories amid soaring consumer demand and transportation bottlenecks, but many including Target Corp. and Walmart Inc. are trying to figure out how to sell all their products as people shift to spending more on services over goods.

“The upstream orders coming from Asia — getting ready for an early arrival of peak-season goods — look strong; the June numbers will be very healthy,” Seroka said in an interview on Bloomberg Television Friday. He added that the port handled just under 970,000 units of cargo in May, making it the operation’s third-busiest month on record.

Read more at Bloomberg

Lawmakers Make Bipartisan Push for New Government Powers to Block U.S. Investments in China

Congress is pressing ahead with legislation that could rewrite the rules for American companies investing abroad, proposing the screening of investments in countries like China seen as adversaries to protect U.S. technologies and rebuild critical supply chains. The measure, part of broader legislation to bolster U.S. competitiveness with China, would require the executive branch to form a new interagency panel to review and block investments on national security grounds, according to congressional aides and a revised draft of the bill reviewed Monday by The Wall Street Journal.

Democratic and Republican supporters in the Senate and the House of Representatives have in recent days agreed on revised text narrowing the investment screening to certain specified sectors and technologies deemed critical, the aides said. The broader legislative package has been stuck in debate for months over its scope, though House Majority Leader Steny Hoyer (D., Md.) said last Tuesday that he wants a vote before the July 4 recess.

Read more at the WSJ

White House Takes New Look at Federal Gas Tax Holiday

The White House is showing signs that it is more seriously considering a federal gas tax holiday, sources tell The Hill. President Biden’s economic team has discussed the gas tax holiday recently and is expected to meet later this week for further talks.

Suspending the federal gas tax would require an act of Congress, but a public push by Biden in favor of the policy could help spur action on Capitol Hill. A handful of states have already moved to suspend their gas tax, and Wolf said he would support Biden calling on remaining states that haven’t yet done so to follow suit.

Read more at The Hill

U.K. Economy Shrinks for Second Month as Outlook Dims

The U.K.’s statistics agency said Monday that gross domestic product—a broad measure of the goods and services produced in an economy—fell by 0.3% from March. Economists had expected to see a small increase in output, following a 0.1% fall in the previous month.

The U.K. is unusual among large economies in providing a monthly measure of economic growth. A second month of contraction is an indication that the rising prices of energy and food caused by Russia’s invasion of Ukraine are likely to be a drag on global growth this year. U.K. households faced a 54% increase in home energy bills during April, sending the annual rate of inflation to a four-decade high of 9% and squeezing spending power.

Read more at the WSJ

Daily Briefing – 524

Post: Jun. 13, 2022

Fed Meets Today Amid Slumping Stock Market, Out-of-Control Inflation

The Federal Reserve begins a two-day meeting Today facing the challenge of an inflation spiral that may require it to raise interest rates to a level that markets are just beginning to take note of and do so without tanking the economy. Markets and experts had expected another 50 basis point hike by the Fed this month after a similar increase in May. But now there is talk the Fed may need to shock markets and the economy with a larger increase of 75 basis points.

“The Fed knows that in the economy, it can’t control supply, only demand, so the Fed will keep raising rates until demand cools sufficiently,” says Gary Zimmerman, a former investment banker who is now CEO of MaxMyInterest. “With so much pent-up demand for travel and experiences and so much dry powder sitting in bank accounts, it could take more drastic measures, or prolonged high rates, to contain inflation.”

War in Ukraine Headlines

The “R” Word

An increasing number of economists are now doubting the possibility of a “soft landing,” which would see the Fed get inflation under control without triggering an economic downturn. While the Fed has so far telegraphed half-point hikes at its meetings in June (coming up on Wednesday) and July, there is some murmur that a larger 75 basis point increase could be on the table.

“I’ve become more pessimistic about the opportunity of stabilizing inflation at an acceptable level without a recession,” said JPMorgan Chase chief economist Bruce Kasman, who also warned of a harmful wage-price spiral. The feedback loop occurs when surging inflation triggers elevated wage demands, leading to increased costs for companies and thereby raising prices even further. “The chairman of the Fed doesn’t want to let the ‘r’ word slip out of his mouth in a positive way, that we need a recession,” added former Fed Vice Chair Alan Blinder. “But there are a lot of euphemisms and he’ll use them.”

Read more at Seeking Alpha

Higher Unemployment Rate Looms as the Fed Fights Inflation

Federal Reserve officials are beginning to signal that higher unemployment rates might be a necessary consequence of their efforts to damp inflation by raising interest rates. This marks a reversal from last year, when their policies provided strong economic stimulus aimed at spurring the labor market’s recovery from the pandemic’s damaging effects.

In economic projections to be released this week, more officials are likely to pencil in plans to raise rates this year to levels high enough to deliberately slow hiring and economic growth in an effort to cool inflation. The policy makers also could project somewhat higher unemployment rates over the next two years than they had anticipated earlier this year. The unemployment rate is at 3.6%. Fed governor Christopher Waller said in a speech on May 30. “If we can get unemployment to just 4.25%, I would consider that a masterful performance by the central bank.”

Read more at the WSJ

US COVID – Why Everyone you Know is getting COVID These Days

Packed indoor events and fully booked flights where masks are few and far between suggest that the pandemic is a distant, unpleasant memory. In reality, Covid-19 cases have steadily increased nationwide since the end of March. Hospitalization and death rates remain low, and will likely stay that way. But beyond that, many experts say they’re unable to predict the trajectory of the current wave, including how and when it will end.

Given the past two years of pandemic precedent, that’s somewhat surprising — and one indicator of many that the ongoing rise in cases is noticeably different than previous Covid surges. Some experts say it might even mark the beginning of the country’s “new normal.” Here’s why, and what that means for the future of the pandemic:

Read more at CNBC

NYS Vaccine and COVID Update –

Vaccine Stats as of June 10:

One Vaccine Dose

90.7% of all New Yorkers – 16,636,019
In the Hudson Valley 1,730,396

Fully Vaccinated

77.5% of all New Yorkers – 14,928,944
In the Hudson Valley – 1,525,547

Boosters Given

All New Yorkers – 8,648,496
In the Hudson Valley – 1,049,605

The Governor updated COVID data through June 10. There were 17 COVID related deaths for a total reported of 71,670

Hospitalizations:

Patients Currently in Hospital statewide: 2,009
Patients Currently in ICU Statewide: 210

7 Day Average Positivity Rate – Cases per 100K population

Statewide 5.41% – 30.31 positive cases per 100,00 population
Mid-Hudson: 5.44% – 28.17 positive cases per 100,00 population

Useful Websites:

Test to Return to the U.S. by Air Dropped

As of last Sunday morning, travelers flying to the United States no longer had to provide a negative test result before boarding their plane. On Friday, the Centers for Disease Control and Prevention said that it was going to lift the requirement on Sunday at 12:01 a.m. after officials determined that the widespread adoption of vaccines and treatments for Covid-19 no longer make it necessary.

In an agency release explaining her decision, Dr. Rochelle P. Walensky, the C.D.C. director, also cited booster shots and the milder Omicron variant, which she said had “generally caused less severe disease among those who are infected.” The decision was met with joy in the travel industry, which for months has been lobbying the administration hard to get rid of the testing rule.

FDA: Pfizer, Moderna Vaccines for Kids Under 6 are Safe, Effective

Two Covid-19 vaccine options for babies and toddlers are safe and effective, FDA reviewers said in briefing documents posted online over the weekend, setting the stage for regulators to potentially authorize the shots for emergency use later this week. The documents will form the basis of the FDA’s independent vaccine advisers’ review at meetings today and Wednesday, during which they’ll vote on whether to recommend the agency endorse EUAs for the myriad age groups.

The three-dose Pfizer-BioNTech vaccine for kids ages 6 months through 4 years will likely benefit this age group, the FDA said, noting higher hospitalization and death rates among the youngest children in the U.S. compared with those 5 and older. Moderna’s two-dose Covid-19 vaccine regimens for children are generally safe and effective for children ranging in age from 6 months to 17 years old, the FDA said in a separate briefing document posted late Friday.

Read more at Politico

S&P 500 Drops Into Bear-Market Territory as Dow, Nasdaq Fall

Faced with rising chances of aggressive monetary tightening by the Federal Reserve, investors broadly unloaded risk. The S&P 500 slumped 3.9%, with most member stocks down on the day. Meanwhile, a rout in cryptocurrencies highlighted investors’ increasing unwillingness to hang on to their most speculative holdings. The price of bitcoin plunged Monday below $23,000, at one point trading down 67% from its November high.

“We’re definitely seeing a risk-off atmosphere, a flight to quality,” said Charlie Ripley, senior investment strategist at Allianz Investment Management. “In that environment, people need to raise cash.” The declines put the S&P 500 in a bear market—down more than 20% from its January high—for the first time since 2020. The Dow Jones Industrial Average fell 2.8%, or about 875 points, while the tech-heavy Nasdaq Composite declined 4.7%.

Read more at the WSJ

New York Lawmakers Pass a Flurry of Worker Protection Laws

As the New York State legislative session came to a close, state lawmakers passed a flurry of laws providing protections to workers, ranging from wage protections for freelance workers, prohibitions against absence control policies that penalize employers for taking protected leave, and amendments to the Hero Act, as well as laws aimed at providing employment protections in specific industries – nursing and warehousing.

These laws are in addition to a salary transparency law, which was also recently passed by New York lawmakers. These bills are now headed to Governor Kathy Hochul’s desk for her signature or veto.

Supply Chain Issues Threaten Chemical Industry Growth

The American Chemistry Council (ACC) Mid-Year 2022 Chemical Industry Situation and Outlook report states that in spite ongoing supply chain constraints, the American chemical industry expects to deliver solid growth this year as it benefits from inventory rebuilding, steady demand across many end-use industries and a continued competitive advantage in natural gas-based chemistries.

Demand for the industry’s products is being driven by technological innovations taking place in different fields, For example, the manufacture of lighter-weight vehicles designed to lessen their impact on the environment is an important end-use market for chemistry, with over $3,200 in chemistry going into each vehicle produced. These lighter-weight vehicles also improve fuel economy and increase safety, according to ACC.

NY- 17, Working Families to Drop Maloney Endorsement and Back Biaggi

The progressive Working Families Party is switching its endorsement from Rep. Sean Patrick Maloney to state Sen. Alessandra Biaggi, who’s challenging the five-term incumbent in the Democratic primary.

The small but influential party in March endorsed Maloney, who heads the Democratic Congressional Campaign Committee. But since then, New York’s congressional maps were redrawn, and Maloney angered much of the left by announcing he was running in the new district he lives in despite it heavily overlapping with the district won by party-backed Rep. Mondaire Jones in 2020 — prompting Jones to now run in New York City.

Read more at Politico

Liquefied Natural Gas Prices Will Steam Up Again

An explosion at one of the largest U.S. LNG export terminals last week sent European gas prices soaring again—demonstrating the fragility of the market and the extent to which it remains exposed to any supply hiccup. Europe’s gas supplies have been under threat since Russia invaded Ukraine in February. While there still appears to be no immediate prospect of a complete halt to Russian supply, overall Russian flows to the region have fallen.

Moreover with Shanghai groping toward reopening and Asian countries stocking up for the winter, Asia is seeing a rebound in demand. That is especially true since rising oil prices and cheaper LNG have made the supercooled fuel more attractive again. On a dollar per British thermal unit basis, Asian LNG prices and Brent oil have reconverged in recent months. Many Asia-bound LNG cargoes were rerouted to Europe earlier this year when the EU was willing to pay a premium. But the spread between European and Asian prices in June has narrowed to about $1 per million British thermal units (MMBtu) from $5 in May.

Read more at the WSJ

The Hamilton Index: Assessing National Performance in the Competition for Advanced Industries

The Hamilton Center on Industrial Strategy at the Information Technology and Innovation Foundation (ITIF) examined national changes in global shares of output in seven industry sectors that the Center has aggregated into the Hamilton Index of Advanced-Technology Performance: pharmaceuticals; medicinal, chemical, and botanical products; electrical equipment; machinery and equipment; motor vehicle equipment; other transport equipment; computer, electronic, and optical products; and information technology and information services.

The data show U.S. performance is weak and declining, both in absolute market share and relative to the size-adjusted global average (a ratio known as a location quotient). It is strongest in IT and other information services (software and Internet companies) and other transportation equipment (principally aerospace). In contrast, U.S. global market share in electrical equipment, machinery and equipment, and motor vehicles is quite low and falling. Significant growth in the IT and other information services sector, both globally and especially in the United States, is why the overall decline in U.S. global market share of advanced industries was limited to 1.5 percentage points from 1995 to 2018.

Daily Briefing – 523

Post: Jun. 12, 2022

8.6 – US Consumer Price Inflation Rises to 41 Year High

U.S. inflation resurged in May as the consumer price index jumped 8.6% compared to 2021, the biggest increase since December 1981, according to government data released Friday. CPI jumped 1% compared to April, after the modest 0.3% gain in the prior month, the Labor Department reported, far higher than expected by analysts who were looking for inflation pressures to ebb slightly.

The data showed gasoline jumped 4.1% in the month, with big gains in housing, airline fares and used and new vehicles.
Energy has soared 34.6% over the past year, the fastest since September 2005, while food jumped 10.1% — the first increase of more than 10% since March 1981, the report said.
Food and fuel prices have accelerated in recent weeks since the Russian invasion of Ukraine sent global oil and grain prices up, and American drivers are facing daily record gas prices, with the national average hitting $4.99 a gallon on Friday, according to AAA.
Even excluding volatile food and energy components, CPI gained 0.6% compared to April and 6% in the latest 12 months, the data showed.

Read more at Politico

War in Ukraine Headlines

Consumer Sentiment Hits Record Low in June as Inflation Weighs on Consumers

Soaring energy and food prices, coupled with falling stock prices, are a toxic combination for consumers’ sentiment, and the Michigan index is now at a record low. The University of Michigan’s consumer sentiment index fell to 50.2 from 58.4, well below the consensus, 58.1

Both the current conditions and expectations measures in the Michigan survey plunged this month, down 8.4 points and 7.9 points respectively. In the past, expectations readings as low as May’s 46.8 would have been consistent with a hefty outright decline in real consumers’ spending, but Pantheon Macro’s Ian Shepardson sees no sign of that right now. He notes that consumers in aggregate are sitting on an extra $3.5T in bank accounts and money market funds, relative to what we would have expected in the absence of the pandemic. Sentiment matters to politicians, but spending matters to the economy. Finally, inflation expectations rose, with the five-to-10-year reading rising by 0.3 points to 3.3%, a new cycle high.

Read more at YahooFinance

ECB Confirms July Rate Hike Plans, Raises Inflation Projections Significantly

The European Central Bank laid out plans to increase interest rates for the first time in more than a decade, joining many of its peers in raising borrowing costs to tackle persistent inflation that is spreading far beyond the U.S. Following the latest monetary policy meeting, the Governing Council announced it intends to raise key interest rates by 25 basis points at the July meeting.

The ECB also downgraded its growth forecasts and upwardly revised its inflation projections. Annual inflation is now expected to hit 6.8% in 2022, declining to 3.5% in 2023 and 2.1% in 2024. This marks a substantial increase from its March projections of 5.1% in 2022, 2.1% in 2023 and 1.9% in 2024.

Read more at CNBC

US COVID – Cases Peaking

The US CDC is reporting 84.9 million cumulative cases of COVID-19 and 1,004,732 deaths. The average daily incidence appears to be peaking, down slightly from the most recent high of 110,433 on May 26 to 104,511 on June 7. Daily mortality continues to remain relatively steady at approximately 290 deaths per day—with the exception of the week following the Memorial Day holiday weekend.

Both new hospital admissions (+6.3% over the past week) and current hospitalizations (+8.4%) continue to increase; however, both trends appear to be tapering off. Community transmission in the US continues to be driven by the BA.2.12.1 sublineage of Omicron (62.2%), followed by BA.2 (24.8%), BA.5 (7.6%), and BA.4 (5.4%). These variants represent essentially all new SARS-CoV-2 infections in the US. Analysis from the Johns Hopkins World In Data—based on data from the US Department of Health and Human Services—indicates that US test positivity continues to increase, up to 13.8% on June 3. The current average is 30% higher than the peak of the Delta surge (10.6%), but still considerably lower than the first Omicron surge (29.2%).

NYS Vaccine and COVID Update –

Vaccine Stats as of June 10:

One Vaccine Dose

90.7% of all New Yorkers – 16,636,019
In the Hudson Valley 1,730,396

Fully Vaccinated

77.5% of all New Yorkers – 14,928,944
In the Hudson Valley – 1,525,547

Boosters Given

All New Yorkers – 8,648,496
In the Hudson Valley – 1,049,605

The Governor updated COVID data through June 10. There were 17 COVID related deaths for a total reported of 71,670

Hospitalizations:

Patients Currently in Hospital statewide: 2,009
Patients Currently in ICU Statewide: 210

7 Day Average Positivity Rate – Cases per 100K population

Statewide 5.41% – 30.31 positive cases per 100,00 population
Mid-Hudson: 5.44% – 28.17 positive cases per 100,00 population

Useful Websites:

WHO: COVID Origins Unclear but Lab Leak Theory Needs Study

Over two years after the coronavirus was first detected in China, and after at least 6.3 million deaths have been counted worldwide from the pandemic, the World Health Organization is recommending in its strongest terms yet that a deeper probe is required into whether a lab accident may be to blame. That stance marks a sharp reversal of the U.N. health agency’s initial assessment of the pandemic’s origins.

WHO concluded last year that it was “extremely unlikely” COVID-19 might have spilled into humans in the city of Wuhan from a lab. Many scientists suspect the coronavirus jumped into people from bats, possibly via another animal. Yet in a report released Thursday, WHO’s expert group said “key pieces of data” to explain how the pandemic began were still missing. The scientists said the group would “remain open to any and all scientific evidence that becomes available in the future to allow for comprehensive testing of all reasonable hypotheses.”

Read more at the AP

Mortgage Demand Falls to the Lowest Level in 22 Years

Total mortgage application volume fell 6.5% last week compared with the previous week, according to the Mortgage Bankers Association’s seasonally adjusted index. Demand hit the lowest level in 22 years. The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($647,200 or less) increased to 5.40% from 5.33%, with points rising to 0.60 from 0.51 (including the origination fee) for loans with a 20% down payment.

Refinance demand, which is most sensitive to weekly rate moves, fell another 6% for the week and was 75% lower than the same week one year ago. The vast majority of mortgage holders now have rates considerably lower than the current one, and even those who would like to pull cash out of their homes are choosing second mortgages, rather than refinancing their first liens.

Read more at CNBC

The J.P. Morgan Global Manufacturing PMI Inched up to 52.4 in May

Global manufacturing production declined for the second successive month in May, as new order growth remained
lacklustre and international trade volumes contracted. Inflationary pressure was elevated, as rates of increase in input costs and selling prices stayed among the highest registered in the survey history.

The J.P.Morgan Global Manufacturing PMI™ – a composite index produced by J.P.Morgan and S&P Global in association
with ISM and IFPSM – posted 52.4 in May, little-changed from April’s 20-month low of 52.3. The headline PMI has remained above the neutral 50.0 mark since July 2020. Lower production volumes reflected lacklustre demand, disruption from stretched supply chains, elevated inflationary pressures, the war in Ukraine and the downturn in Chinese manufacturing. By sector, further contractions (albeit at slower rates) were registered in both the intermediate and
investment goods categories, while consumer goods output returned to moderate expansion.

Ports At Near-Record Volume, As West Coast Contract Deadline Approaches

Imports at the nation’s major retail container ports should see near-record volume again this month as retailers work to meet still-strong consumer demand and also protect themselves against potential disruptions at West Coast ports, according to the monthly Global Port Tracker report released on June 8 by the National Retail Federation and Hackett Associates. U.S. ports covered by Global Port Tracker handled 2.26 million TEUs. in April, the latest month for which final numbers are available. That was down 3.6% from March’s 2.34 million TEU – the record for the number of containers imported in a single month since NRF began tracking imports in 2002 – but up 5.1% year over year.

“We’re in for a busy summer at the ports,” NRF vice president for Supply Chain and Customs Policy Jonathan Gold said in a statement. “Back-to-school supplies are already arriving, and holiday merchandise will be right behind them. And the big wild card is what will happen with West Coast labor negotiations with the current contract set to expire on July 1. We continue to encourage the parties to remain at the table until a deal is done, but some of the surge we’ve seen may be a safeguard against any problems that might arise.”

Weekly Jobless Claims Rise By 27,000 Week on Week

New jobless claims jumped higher during the first week of June, according to data released Thursday by the Labor Department.

In the week ending June 4, initial applications for unemployment insurance totaled 229,000, a gain of 27,000 from the previous week’s revised total of 202,000 claims.
The U.S. has seen an average of 215,000 claims per week over the past four months, rising from an average of 207,000 claims in May.

Jobless claims have remained low for most of 2022 as employers struggle to fill a record number of open jobs from a workforce still smaller than it was before the onset of the coronavirus pandemic in March 2020.

Read more at The Hill

Alleged Gunman in Shooting at Maryland Manufacturer Charged with Murder

A 23-year-old man is facing multiple charges of murder and assault, among other charges, for allegedly opening fire at his workplace in Maryland earlier this week. The suspect is Hedgesville, W.Va., resident Joe Louis Esquivel, who faces more than two dozen charges in connection with a shooting at Columbia Machine Inc. on Thursday in Smithsburg, Md., that left three people dead and one person critically injured.

Esquivel had been an employee there and had shown up to work his shift that day as usual. He allegedly left work on Thursday afternoon to grab a weapon from his car before heading back inside the building, where he allegedly “proceeded to the area of the breakroom” and began “to fire upon employees,” officials said. The motive for the shooting is still under investigation.

NAM’s Timmons Urges Administration to Oppose Controversial WTO IP Waiver

In a letter sent on June 8 to U.S. Trade Representative Katherine Tai and other senior members of the Biden administration in advance of the June 12-15 WTO 12th Ministerial Conference, NAM President and CEO Jay Timmons urged the administration to oppose a controversial waiver of intellectual property for vaccines at the WTO. In the letter, Timmons stressed:

Manufacturers’ critical role in developing, creating and distributing critical products needed to fight the pandemic at an unprecedented scale and scope, and the central role of innovation and intellectual property protections to enable those efforts.
The direct harm to U.S. manufacturing leadership posed by the proposed WTO/TRIPS waiver, and its ineffectiveness in tackling the biggest current challenges to the pandemic response, such as supply chains, distribution and demand issues.
A strong call for the U.S. government to oppose the waiver, and instead pursue practical, effective solutions such as the Trade in Health and “zero-for-zero” initiatives that would fight COVID-19 and strengthen the global trading system.

The NAM continues to lead the charge for manufacturing innovation and against proposals such as the WTO/TRIPS waiver through letters, submissions, public reporting and public advocacy to raise concerns with the waiver approach and working towards constructive solutions.

Intel Joins Other Tech Companies Putting a Freeze on Hiring, as the Chip Industry Faces a Reset

The chip crunch of 2021 may have been frustrating for consumers and electronics manufacturers, but it was a boon for chipmakers, many of which reported record revenues for the year and shot up the Fortune 500 rankings. But the sector is now bracing for a reset, caused by a worsening economy, declining consumer demand, and continued disruption from China’s lockdowns.

Intel, one of the world’s leading chipmakers, has responded to global headwinds by joining a string of other tech companies in placing a freeze on new hires as it seeks ways to cut costs. Intel said in a statement provided to Fortune on Thursday Intel is placing a two-week hiring freeze on its client computing group, which creates PC chips for desktop and laptop computers. Client computing is Intel’s largest division by sales, generating just over 50% of the manufacturer’s revenue last quarter. In April, Intel issued weaker-than-expected profit guidance for the second quarter, citing reduced PC chip sales.

Read more at Fortune

China Digs in for Permanent Zero-COVID With Testing and Quarantine Regime

China is building hundreds of thousands of permanent coronavirus testing facilities and expanding quarantine centres across many of its biggest cities as part of its zero-Covid policy, despite the economic and human toll on the world’s most populous country.

Tough restrictions in scores of cities have driven the country to the edge of recession for just the second time in three decades. But even though measures have been eased in many areas, experts believe the government’s virus infrastructure programme is designed to sustain the mass-testing and quarantine policies through 2023.

Court Upholds Danskammer DEC Permitting Denial Under Still-Evolving CLCPA

In the first decision regarding an administrative agency’s authority to deny permit applications based on New York’s Climate Leadership and Community Protection Act (“CLCPA”), Orange County Supreme Court in Danskammer Energy, LLC v. NYS Department of Environmental Conservation, et al., found that “the Department of Environmental Conservation has authority under § 7(2) of the [CLCPA] to deny a permit application, if warranted, based upon application of the same.”

Danskammer argued, in part, that without the enforcement regulations, DEC was without authority to deny its application under CLCPA § 7(2) alone (CPLR 7803 (2)), and/or DEC’s denial was made in violation of lawful procedure (CPLR 7803 (3)). The Court, however, disagreed. In reaching its decision, the court relied on settled canons of statutory construction.

Daily Briefing – 522

Post: Jun. 8, 2022

OECD Slashes Growth Outlook for This Year and Next

The Organization for Economic Cooperation and Development shaved off 1.5 percentage points from its December global growth outlook to 3 percent this year, it announced Wednesday, while it adjusted its 2023 estimate downward to 2.8 percent. The OECD also expects inflation to average 8.8 percent across its 38 members this year— up from 4.5 percent in December — before slowly receding in 2023.

The downgrade is mostly due to Russia’s invasion of Ukraine, with Europe being the hardest hit due to higher exposure, notably through energy dependency on Russia. Continued lockdowns in China and disruptions to supply chains are also factors, the intergovernmental organization said.

Read more at Politico

Invasion of Ukraine Headlines

Half Full: Three Key Indicators Showing Inflation is Poised to Ease

After months of rising prices and tightening purse strings, the price of semiconductor chips, shipping, and fertilizer is receding down to normal levels—indicating that global inflation might be past its peak. These three supply-side metrics, which have soared over the last year, pushing inflation levels globally to the highest point in 40 years, are now turning around and falling from their pandemic highs.

The price of semiconductors is finally showing signs of easing. The inSpectrum Tech PC DRAM contract price is at half of its July 2018 peak and down 14% from the same time last year, according to Bloomberg data. Meanwhile, the spot rate for shipping containers, which is used as an indicator for future prices, has declined 26% since its September 2021 all-time high. And finally, the price of fertilizer, which has soared since Russia invaded Ukraine on Feb. 24, is 24% below its record high in March.

Read more at Fortune

Half Empty: Fed’s Mester Says Inflation Hasn’t Peaked and Multiple Half-Point Hikes Are Needed

Cleveland Federal Reserve President Loretta Mester said Friday that she doesn’t see ample evidence that inflation has peaked and thus is on board with supporting a series of aggressive interest rate increases. While other recent data points have shown that at least the rate of inflation increases has diminished, the policymaker said she will need to see multiple months of that trend before she’ll feel comfortable.

“The No. 1 problem in the economy remains very, very high inflation, well above acceptable levels, and that’s got to be our focus going forward,” Mester said. Recent statements from the rate-setting Federal Open Market Committee indicate that 50 basis point — or half-point — rate increases are likely at the June and July meetings. Officials are then likely to evaluate the progress that the policy tightening and other factors have had on the inflation picture. But Mester said any type of pause in rate hikes is unlikely, though the magnitude of the increases could be reduced.

Read more at CNBC

US COVID – BA.4, BA.5 Variants Rise Among U.S. Covid-19 Cases

Omicron Covid-19 variants BA.4 and BA.5 are on the rise in the U.S., adding two more highly contagious versions of the virus to the mix that has fueled a springtime surge in cases. The spread of the subvariants could at least prolong the time it takes to emerge from the current wave fueled by other versions of Omicron, some health experts said.

The closely related subvariants represented a combined 13% of U.S. cases for the week ended June 4, according to estimates the Centers for Disease Control and Prevention released on Tuesday. Evidence suggests the variants are yet-more contagious versions of Omicron, public-health experts said, that may be able to evade some of the immune protections people built up from infections triggered by another version of Omicron during the winter.

Read more at the WSJ

NYS Vaccine and COVID Update –

Vaccine Stats as of June 3:

One Vaccine Dose

90.7% of all New Yorkers – 16,620,295
In the Hudson Valley 1,728,722

Fully Vaccinated

77.5% of all New Yorkers – 14,914,852
In the Hudson Valley – 1,524,002

Boosters Given

All New Yorkers – 8,569,648
In the Hudson Valley – 1,038,542

The Governor updated COVID data through June 3. There were 22 COVID related deaths for a total reported of 71,670

Hospitalizations:

Patients Currently in Hospital statewide: 2,332
Patients Currently in ICU Statewide: 221

7 Day Average Positivity Rate – Cases per 100K population

Statewide 6.53% – 29.84 positive cases per 100,00 population
Mid-Hudson: 7.54% – 31.94 positive cases per 100,00 population

Useful Websites:

FDA Panel Recommends Novavax COVID-19 Vaccine, Fourth for Use in US

A federal advisory committee recommended Tuesday that a fourth COVID-19 vaccine be authorized for use in the USA, this one from Novavax, a company based in Gaithersburg, Maryland. The two-dose Novavax vaccine was shown to be safe and 90% effective in a large study conducted in late 2020 and early 2021.

The vaccine, which was supported by $1.8 billion in taxpayer funding, relies on a more traditional approach than the vaccines from Moderna and Pfizer-BioNTech. The Novavax vaccine is a protein-based vaccine and includes an adjuvant to boost its effectiveness. The protein-based technology has been used in other vaccines. The spike protein found on the surface of the coronavirus that causes COVID-19 is manufactured in insect cells, then delivered, along with the adjuvent, inside a nanoparticle. The immune system learns to recognize this spike protein and to attack it when seen again on the virus.

Moderna Says its New Vaccine Booster Shows ‘Superior’ Response to Omicron

Moderna says its new vaccine candidate, which fights both the original COVID-19 strain and the now-dominant omicron variant, shows a “superior neutralizing antibody response” against the coronavirus compared to its original vaccine. The “bivalent” vaccine — meaning it targets two different antigens — is Moderna’s leading candidate to have an effective booster ready for fall of 2022, the company said.

Because of the higher antibody response seen with the new vaccine candidate, Moderna predicts that people who get the booster will have protection that is “more durable over time” against omicron, compared to the original Moderna vaccine.

NY GOP Gubernatorial Primary Still a ‘Free-For-All’ as Voting Day Nears

The New York GOP have to decide whether Long Island Rep. Lee Zeldin, former White House aide Andrew Giuliani, former Westchester County Executive Rob Astorino or businessman Harry Wilson should be the party’s pick to, in all likelihood, face Gov. Kathy Hochul in November. With fewer than three weeks to go before the June 28 primary – early voting begins June 18 – the race is still up in the air, though a Post analysis of fundraising and polling indicates two candidates have separated themselves from the rest.

“It’s a tough race to handicap and right now, it looks like a free-for-all – it’s wide open and a lot of positioning in terms of where they’re gonna be,” Lee Miringoff, director of the Marist Poll, told the Post Wednesday. “But Republicans recognize they’re the smaller party in New York and this could be a Republican year nationally. The debate becomes very important for them.”

The World Bank Says Most Countries are Headed for a Recession

Investors, bankers, and entrepreneurs have been discussing the chances of a coming recession for months. Now the world’s premier international credit institution is joining the chorus that a recession is likely, and warns that something even worse might be on the horizon.

Global economic growth is expected to slow down before the end of the year, and most countries should begin preparing for a recession, according to the World Bank’s latest global economic forecast released on Tuesday. “For many countries, recession will be hard to avoid,” wrote World Bank president David Malpass. “Just over two years after COVID-19 caused the deepest global recession since World War II, the world economy is again in danger.”

Read more at Fortune

US Logistics Industry Witnesses Slowing Job Growth

Trucking, parcel delivery and warehousing companies together added 32,900 jobs in May, a decrease from 44,700 in April and mirroring overall slowing growth in the US job market, according to the Bureau of Labor Statistics. Trucking businesses accounted for the addition of 13,300 jobs in May and over 70,000 jobs in the past year, which experts say could be the result of companies offering higher salaries for new recruits and independent owner-operators joining bigger trucking firms as employees.

Except for a dip of 2,700 jobs reported for March, total employment in truck transportation has risen every month since the almost 80,000-job plunge in April 2020, the first month of the pandemic. This year, besides the March dip, the increases were 11,000 in February, 14,000 in April and the latest increase of 13,300 jobs.

U.S. Mulls Lifting Some China Tariffs to Fight Inflation

U.S. Commerce Secretary Gina Raimondo said on Sunday that President Joe Biden has asked his team to look at the option of lifting some tariffs on China that were put into place by former President Donald Trump, to combat the current high inflation.

“There are other products – household goods, bicycles, etc – and it may make sense” to weigh lifting tariffs on those, she said, adding the administration had decided to keep some of the tariffs on steel and aluminum to protect U.S. workers and the steel industry.

Read more at Reuters

Natural Gas Futures Soar as Supply Cuts Hit; $10 Gas Possible in ‘Fairly Near Future’

In one of the most explosive sessions in recent weeks – and that’s saying a lot – natural gas futures rocketed higher Monday as production struggles to gain momentum and heat is starting to intensify ahead of what’s expected to be a hot summer. The July Nymex gas futures contract jumped 79.9 cents to $9.322/MMBtu. August futures climbed 79.6 cents to $9.306.

Production has been a source of frustration for the gas market. After nearing late-2021 highs early last week, output softened later in the period and failed to recover over the weekend. Estimates showed production at around 95 Bcf on Monday, 2 Bcf shy of the highs largely viewed as needed to loosen up supply/demand balances.

Wondering Why the Price of Natural Gas is Suddenly so Damn High? The Booming US LNG Export Industry

Exports of Liquefied Natural Gas (LNG) from the US to the rest of the world jumped by 18% over the first four months of 2022, to an average of 11.5 billion cubic feet per day (Bcf/d), compared to the annual average in 2021, according to the EIA today. Exports of LNG have been increasing at huge rates – by 49% in 2021, by 31% in 2020, by 68% in 2019, by 53% in 2018, and by 279% in 2017. This growth comes as a function of the completion of new LNG export terminals.

In 2021, the US shipped 34% of its annual LNG production to Europe. But over the first four months this year, a massive shift occurred, when 74% of US LNG was exported to Europe, tripling the volume to 7.3 Bcf/d, and accounted for 49% of total LNG imports. This shift from Asia to Europe was driven by spiking spot prices for LNG at European trading hubs that incentivized US exporters with destination flexibility in their contracts to ship LNG to the EU and the UK.

Supply Chain, Inflation Drag Cutting-Tool Demand

U.S. machine shops and other manufacturers consumed $175.5 million during April 2022, a -10.1% drop from the March consumption figure but still 3.8% ahead of the April 2021 total. The figures are supplied by the U.S. Cutting Tool Institute (USCTI) and AMT – the Association for Manufacturing Technology in their monthly Cutting Tool Market Report – an index to overall manufacturing activity, because cutting tools are a primary consumable across manufacturing sectors. Through four months of activity, the year-to-date consumption total according to CTMR is $700.4 million, up 9.1% compared to January-April 2021.

While the industrial economy continues to be strained by an unreliable supply chain – supplies for parts and materials are inconsistent or unavailable, and many business continue to operate below capacity while struggling to fill open positions – the USCTI head’s comment acknowledges the growing concern for inflation’s effects on overall economic growth.

Read more at American Machinist

Daily Briefing – 521

Post: Jun. 7, 2022

U.S. Trade Deficit Narrows Sharply in April

The U.S. trade deficit narrowed sharply in April as imports declined, suggesting that trade could contribute to economic growth this quarter for the first time in two years. The Commerce Department said on Tuesday that the trade deficit dropped 19.1% to $87.1 billion. Imports of goods and services fell 3.4% to $339.7 billion, while exports increased 3.5% to $252.6 billion.

A record trade deficit chopped 3.23 percentage points from gross domestic product in the first quarter, resulting in GDP contracting at a 1.5% annualized rate after growing at a robust 6.9% pace in the fourth quarter. Trade has subtracted from GDP for seven straight quarters. The trade deficit has gyrated from month to month because of shipping disruptions and supply shortages tied to the pandemic, but the trend is up. The U.S. posted a record trade gap last year and is on track to do so again in 2022.

Invasion of Ukraine Headlines

Janet Yellen Tells Lawmakers She Expects Inflation to Remain High

Treasury Secretary Janet Yellen said in Senate testimony that she expects inflation to remain elevated, underscoring the challenge facing the U.S. economy and the Biden administration as inflation runs at its highest rate in decades. “I do expect inflation to remain high, although I very much hope that it will be coming down now,” Ms. Yellen said, adding that the Biden administration was updating its forecast that inflation would average 4.7% this year.

Ms. Yellen said during a television appearance last week that she was wrong in 2021 when she said that inflation would quickly ease, an admission that fueled Republican criticism of Democrats’ handling of the economy. Ms. Yellen defended the legislation in testimony on Tuesday, saying it has played a central role in driving strong growth and supporting the economic recovery. Excerpts of a coming biography about Ms. Yellen stated that she harbored concerns about the size of the legislation and the impact the spending could have on prices.

Read more at the WSJ

World Bank Slashes Global Growth Forecast to 2.9%, Warns of Stagflation

The World Bank on Tuesday slashed its global growth forecast and warned that many countries could fall into recession as the economy slips into a period of stagflation reminiscent of the 1970s. Global economic expansion is expected to drop to 2.9% this year from 5.7% in 2021 — 1.2 percentage points lower than the 4.1% predicted in January. Growth is expected to then hover around that level through 2023 to 2024 while inflation remains above target in most economies, the report said, pointing to stagflation risks.

Growth in advanced economies is projected to decelerate sharply to 2.6% in 2022 from 5.1% in 2021 before further moderating to 2.2% in 2023, the report said. Expansion in emerging market and developing economies, meanwhile, is projected to fall to 3.4% in 2022 from 6.6% in 2021, well below the annual average of 4.8% from 2011 to 2019. That as inflation continues to climb in both advanced and developing economies, prompting central banks to tighten monetary policy and raise interest rates to curb soaring prices.

Read more at CNBC

US COVID – Pancoronavirus Vaccine

Health experts in the US are discussing the next generation of SARS-CoV-2 vaccines. The US FDA’s Vaccines and Related Biological Products Advisory Committee (VRBPAC) is scheduled to meet on June 28 to discuss whether and how the SARS-CoV-2 strain composition of vaccines should be modified. Pfizer-BioNTech and Moderna are conducting clinical trials of modified versions of their vaccines that target multiple variants, including more recent Omicron subvariants, and 2 additional novel SARS-CoV-2 vaccine designs are in clinical trials, including a plant-based vaccine and a receptor binding domain (RBD)-dimer-based vaccine. Additionally, different delivery methods, such as inhaled nasal administration, could produce better mucosal immunity and potentially reduce breakthrough infections.

As the next generation of SARS-CoV-2 vaccines are being developed, health officials are speculating about whether booster doses will be needed annually, similar to a flu shot. The aspiration is a pancoronavirus that protects against all variants and sublineages, including possibly yet-to-emerge versions.

NYS Vaccine and COVID Update –

Vaccine Stats as of June 3:

One Vaccine Dose

90.7% of all New Yorkers – 16,620,295
In the Hudson Valley 1,728,722

Fully Vaccinated

77.5% of all New Yorkers – 14,914,852
In the Hudson Valley – 1,524,002

Boosters Given

All New Yorkers – 8,569,648
In the Hudson Valley – 1,038,542

The Governor updated COVID data through June 3. There were 22 COVID related deaths for a total reported of 71,670

Hospitalizations:

Patients Currently in Hospital statewide: 2,332
Patients Currently in ICU Statewide: 221

7 Day Average Positivity Rate – Cases per 100K population

Statewide 6.53% – 29.84 positive cases per 100,00 population
Mid-Hudson: 7.54% – 31.94 positive cases per 100,00 population

Useful Websites:

U.S. Has Wasted More Than 82 Million COVID Vaccine Doses

According to data from the US CDC, more than 82 million doses (11%) of distributed SARS-CoV-2 vaccines in the US were wasted between December 2020 and May 2022. Over a quarter of doses thrown away were distributed by CVS and Walgreens, the 2 largest US retail pharmacy chains. Other pharmacies and health centers, including Rite Aid, Costco, and DaVita, wasted fewer overall doses but a higher share of their received doses than CVS and Walgreens.

Packaging is a large contributing factor to vaccine wastage. The SARS-CoV-2 vaccines are packaged in multidose vials, and if a vial is not quickly used after opening, it has to be discarded due to their short shelf life under emergency authorizations. Concerns around vaccine wastage due to packaging are not unique to the US. Prior to the COVID-19 pandemic, the WHO cautioned that large vaccination campaigns using multidose vials will experience significant rates of vaccine wastage. The CDC is working with vaccine manufacturers to produce single-dose vials to help reduce waste. Additionally, Pfizer is making adjustments to extend shelf-life, improve handling and storage requirements, and minimize waste.

Mandatory COVID-19 Testing Ending for Unvaccinated State Workers

Thousands of unvaccinated state workers will no longer be required to submit to weekly COVID-19 testing beginning Tuesday, according to a directive issued late last week by the Governor’s Office of Employee Relations. The recent directive from the Governors Office of Employee Relations suspending the testing requirements was disseminated to state human resources managers and said that, after Tuesday, and “until further notice, employees do not need to test weekly pursuant to the state testing program.” The statement added: “Given the wide availability of tests, (human resources) managers should encourage all employees to continue testing through home tests or at testing locations … .”

A spokeswoman for the Governor’s Office of Employee Relations said the directive issued Friday ending the mandatory testing would not impact hundreds of unvaccinated nurses and other medical professionals who were forced off the job last year and have faced disciplinary proceedings after they declined to get vaccinated by the state-imposed Sept. 27 deadline.

Goldman Sachs Predicts Oil Will Surge to $140 a Barrel this Summer

Goldman Sachs economists have predicted oil prices will surge to $140 a barrel this summer, with a drop in Russian production and a gradual recovery in Chinese demand adding to the pressure on already low supplies. They added consumers will feel as though oil has hit $160 a barrel, because a lack of capacity at refineries means gasoline and fuel prices are rising more than would normally be expected, adding to costs across the economy.

They said bottlenecks at refineries — which turn crude oil into usable oil products — mean gas and fuel costs are considerably higher than would normally be expected compared to benchmark prices. The analysts said there was “an unprecedented refining shortage. The investment bank said it expects prices to stay high, even though a surge to around $140 would trigger some “demand destruction” by encouraging people to stop using as much energy.

Australia’s Central Bank Raises Rates by 50 Basis Points in Hawkish Surprise

Wrapping up its June policy meeting, the Reserve Bank of Australia (RBA) lifted its cash rate by 50 basis points to 0.85%, wrong footing investors who had wagered on a move of either 25 or 40 basis points.

“Given the current inflation pressures in the economy, and the still very low level of interest rates, the Board decided to move by 50 basis points today,” said RBA Governor Philip Lowe in a statement. “The Board expects to take further steps in the process of normalising monetary conditions in Australia over the months ahead.”

Read more at CNBC

Half-Point European Central Bank Rate Hike by July Is Coin Toss

Traders have priced in 37.5 basis points of tightening to the central bank’s rate by next month’s meeting, implying a 50% chance of a half-a-percentage point increase, which would be the first since 2000. Such a hike is already baked in by September. It’s a far cry from the start of the year when inflation was expected to be transitory and traders were betting on just 15 basis points of tightening this year.

The ECB has come under huge pressure after the region’s inflation extended a record surge in May, climbing to more than four times the central bank’s target of 2%. While ECB officials have long signaled that a quarter-point hike is coming, some Governing Council members have suggested that a bigger hike is possible.

Is This a Surprise? Pay is Top Priority for Blue Collar Workers

EmployBridge surveyed 19,500 workers for their 16th Annual Voice of the Blue-Collar Worker survey and found that 40% of the hourly workers picked pay as their top concern. Last year pay was also the top issue, however the percentage was 32%.

The EmployBridge survey also found that:

While shift and schedule flexibility have been important in the past, this year they rank in the top three factors in workers’ decisions about which job they choose — and whether to stay at a job.
Despite a tumultuous year, workers are optimistic about their own financial futures and “satisfied” with their current roles.
COVID-19 concerns have declined significantly but are still present, particularly for female workers.

Target Cancel Orders, Cuts Prices to Shed Amassed Inventory

Target is canceling orders from suppliers, particularly for home goods and clothing, and it’s slashing prices to clear out amassed inventory ahead of the critical fall and holiday shopping seasons. The actions comes after a pronounced spending shift by Americans, from investments in their homes homes, to money spent on travel, nights out for dinner and dressier clothes, a change that arrived much faster than major retailers had anticipated. Other retailers including Gap, Macy’s, Walmart and Kohl’s have also reported rising inventories.

The speed at which Americans pivoted away from pandemic spending was laid bare in the most recent quarterly financial filings from a number of major retailers. Target reported last month its profit for the fiscal first quarter tumbled 52% compared with the same period last year. Sales of big TVs and appliances that Americans loaded up on during the pandemic have faded, leaving Target with a bloated inventory that it said must be marked down to sell.

EU Agrees Single Mobile Charging Port in Blow to Apple

Apple will have to change the connector on iPhones sold in Europe by 2024 after EU countries and lawmakers agreed on Tuesday to a single mobile charging port for mobile phones, tablets and cameras in a world first. The political intervention, which the European Commission said would make life easier for consumers and save them money, came after companies failed to reach a common solution.

iPhones are charged from a Lightning cable, while Android-based devices use USB-C connectors. Half the chargers sold with mobile phones in 2018 had a USB micro-B connector, while 29% had a USB-C connector and 21% a Lightning connector, according to a 2019 Commission study. “By autumn 2024, USB Type-C will become the common charging port for all mobile phones, tablets and cameras in the EU,” the European Parliament said in a statement.

Read more at Reuters

Trade Turmoil in Solar Energy Industry

President Joe Biden invoked the Defense Production Act to spur domestic manufacturing of crucial equipment and promised his administration would not impose any new import tariffs on solar power equipment for up to two years while the administration conducts an ongoing trade probe.

The industry has been roiled by a Commerce Department investigation into whether companies based in four Southeast Asian countries have circumvented the tariffs on Chinese shipments of solar equipment to the U.S. That probe has slowed the development of large renewable projects. But the new actions have already drawn criticism from the small, California-based solar manufacturer that lodged the initial complaint that imports were circumventing existing duties. “President Biden is significantly interfering in Commerce’s quasi-judicial process,” said Auxin Solar CEO Mamun Rashid. “By taking this unprecedented — and potentially illegal — action, he has opened the door wide for Chinese-funded special interests to defeat the fair application of U.S. trade law.”

Read more at Politico

No, You

New Guidance

Daily Briefing – 520

Post: Jun. 6, 2022

BLS: Labor Productivity Declines the Most Since 1947

Nonfarm business sector labor productivity decreased 7.3 percent in the first quarter of 2022, the U.S. Bureau of Labor Statistics reported today, as output decreased 2.3 percent and hours worked increased 5.4 percent. This is the largest decline in quarterly productivity since the third quarter of 1947, when the measure decreased 11.7 percent. Labor productivity, or output per hour, is calculated by dividing an index of real output by an index of hours worked by all persons, including employees, proprietors, and unpaid family workers.

Unit labor costs in the nonfarm business sector increased 12.6 percent in the first quarter of 2022, reflecting a 4.4-percent increase in hourly compensation and a 7.3-percent decrease in productivity. Unit labor costs increased 8.2 percent over the last four quarters. This is the largest four-quarter increase in this measure since another 8.2-percent increase in the third quarter of 1982. With the 5.4 percent increase to hours worked in the first quarter of 2022, this marks the first quarter that both the output and hours worked measures have surpassed their levels in the fourth quarter of 2019, the last quarter
not affected by the COVID-19 pandemic.

Invasion of Ukraine Headlines

WSJ-NORC Poll: Inflation, Political Division Put U.S. in a Pessimistic Mood

Americans are deeply pessimistic about the U.S. economy and view the nation as sharply divided over its most important values, according to a new Wall Street Journal-NORC Poll. The findings are from a Journal survey conducted with NORC at the University of Chicago, a nonpartisan research organization that measures social attitudes. The survey found Americans in a sour mood and registering some of the highest levels of economic dissatisfaction in years. The pessimism extended beyond the current economy to include doubts about the nation’s political system, its role as a global leader and its ability to help most people achieve the American dream.

Some 83% of respondents described the state of the economy as poor or not so good. More than one-third, or 35%, said they aren’t satisfied at all with their financial situation. That was the highest level of dissatisfaction since NORC began asking the question every few years starting in 1972 as part of the General Social Survey, though the poll’s 4-point margin of error means that new figures may not differ significantly from prior high and low points.

Read more at the WSJ

US Suspends Solar Tariffs, Boosts Production in Clean Energy Push

U.S. President Joe Biden on Monday suspended tariffs for two years on solar panel imports from four countries and invoke a key power to compel domestic manufacture of clean energy technology, the White House said. Duties will be lifted on certain solar parts from Cambodia, Malaysia, Thailand and Vietnam. China is excluded as the Commerce Department investigates whether some Chinese companies are circumventing U.S. customs duties by assembling parts in the four countries.

The moves are aimed at boosting renewable capacity and combating climate change, a priority for the president whose green ambitions have met with mixed success. At the same time, Biden’s administration will invoke the Defense Production Act (DPA) to accelerate production and use the federal government’s purchasing power to increase demand. Solar panel parts, building insulation and efficient heat pumps are all targeted under the DPA.

Read more at IndustryWeek

US COVID – Push for Normalcy Wins Out in COVID Wars

Even as infections rise to levels that are four to five times higher than the same point last year, the push for normalcy is winning out. Experts say it’s not surprising; because of widespread vaccinations and treatments available, many people no longer see the virus as the threat it once was. A year ago, there was widespread optimism as cases were so low that the virus seemed on the verge of being defeated. Yet mitigation measures, namely masks and vaccination requirements, remained in place.

Now, almost all masks or vaccine requirements have been deliberately abandoned or overturned in court. The U.S. is averaging about 100,000 new cases every day, but movie studios are releasing summer blockbusters to packed theaters, families are celebrating weddings, and bars and restaurants are full. Hospitalizations stand at about 3,500 per day and deaths are hovering around 300 per day. They are higher than last summer, but also relatively low compared to the omicron surge in January.

Read more at The Hill

NYS Vaccine and COVID Update –

Vaccine Stats as of June 3:

One Vaccine Dose

90.7% of all New Yorkers – 16,620,295
In the Hudson Valley 1,728,722

Fully Vaccinated

77.5% of all New Yorkers – 14,914,852
In the Hudson Valley – 1,524,002

Boosters Given

All New Yorkers – 8,569,648
In the Hudson Valley – 1,038,542

The Governor updated COVID data through June 3. There were 22 COVID related deaths for a total reported of 71,670

Hospitalizations:

Patients Currently in Hospital statewide: 2,332
Patients Currently in ICU Statewide: 221

7 Day Average Positivity Rate – Cases per 100K population

Statewide 6.53% – 29.84 positive cases per 100,00 population
Mid-Hudson: 7.54% – 31.94 positive cases per 100,00 population

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A More Traditional Coronavirus Shot is On the Way

Novavax’s Covid-19 vaccine will face the scrutiny of the Food and Drug Administration’s independent immunization experts this week, a crucial step on the path toward U.S. regulatory authorization two years after the Maryland biotech company received taxpayer funding to develop the shots. Novavax’s shots are based on protein technology used for decades in hepatitis B and HPV vaccines. Novavax believes it can reach people who have not got vaccinated yet, because they would prefer to receive a shot based on technology that has a longer track record, Taylor said.

The committee of vaccine experts will weigh the safety of Novavax’s shots and their effectiveness at preventing Covid during an all-day public meeting on Tuesday. If the committee endorses the vaccine, the FDA will almost certainly give the green light for doses to ship from Novavax’s manufacturing partner the Serum Institute of India to the U.S. The company’s shots have been authorized in 41 countries outside the U.S., including Australia, Canada, and the European Union.

Read more at CNBC

Inflation’s Endgame… It’s Complicated

For economy watchers searching for inflation’s peak amid the economic haze, the latest jobs report offered some hopeful signposts. We’ll get an even clearer look this coming Friday, when the Labor Department releases new consumer price index data for May.

Average hourly earnings for private sector workers rose 0.3 percent for the second consecutive month, bringing the annual increase to 5.2 percent, down from 5.5 percent in April and 5.6 percent in March. Schwartz also noted that several major companies announced hiring freezes in recent weeks. Those factors would all be welcome developments for the Federal Reserve and could work in its favor as the central bank tries to suss out how far and fast to raise interest rates.

Read more at Politico

Beijing, Shanghai Reopening Speed Up: China Lockdown Tracker

China’s worst Covid-19 outbreak is ending, with cases continuing to fall, all major cities loosening restrictions and daily life mostly returning to normal.

Infections are trending down nationwide, thanks to the ebbing outbreaks in Shanghai and Beijing. Of China’s top 50 cities by economic size, none currently have widespread restrictions in place. Tianjin hasn’t reported any local cases for the past 3 days and most public transport has resumed, while Beijing is resuming dine-in services and reopening parks and entertainment venues.

Read and see the lockdown tracker at Bloomberg

Supreme Court Rejects Forced Arbitration for Southwest Airlines Baggage Workers

The Supreme Court on Monday ruled unanimously that airline baggage handlers can’t be compelled to resolve employment disputes through individual private arbitration, bucking a trend of recent decisions making it easier for employers to avoid class-action lawsuits brought by workers. Writing for the court, Justice Clarence Thomas said baggage handlers expressly are exempted from the Federal Arbitration Act, a 1925 law that allows employers to make it a condition of employment that workers agree to mandatory arbitration of workplace disputes.

The scope of the carve-out, known as the “transportation workers exemption,” has been frequently litigated in recent years. It is an important issue for many businesses because it determines their exposure to class-action lawsuits for employer misconduct, which if settled or successful can result in significant damages. Employers frequently prefer to require employees to bring claims individually through private arbitration.

Read more at the WSJ

Productive? New York Lawmakers Approved More Than 1,000 Bills

State lawmakers in New York concluded the six-month legislative session last week after passing more than 1,000 bills in both chambers of the Legislature — a rate of production that easily surpasses the last 25 years in Albany. The New York Public Interest Research Group recorded the tally, finding the Democratic-controlled chambers are once again more likely to approve companion bills that stand a chance of becoming law since the party took control of the state Senate in 2019

The analysis from the group found the Legislature approved 1,007 bills in the last six months that are “same as” — bills that were given approval by both chambers and can be sent to Gov. Kathy Hochul for consideration. It’s the highest number of bills to be approved in both chambers over a period dating back to 1995. And it easily breaks the 2021 record of 892 bills passing during that time.

Hudson Valley Community Colleges Team Up for Cannabis Workforce Grant

Community colleges in the Hudson Valley are teaming up to develop job training as the cannabis industry continues to emerge in New York.

SUNY Sullivan President Jay Quaintance said the colleges will be sharing a grant for that purpose. “We signed off on a grant with the other community colleges in the Hudson Valley, which would be a workforce training grant – about $3 million – for the consortium of colleges to provide workforce development for that emergency industry as that continues to potentially grow and we see how it grows,” he said.

The Robust Rise of Reshoring

Reshoring and foreign direct investment (FDI) job announcements hit a record 261,000 in 2021, according to the Reshoring Initiative’s 2021 Data Report. According to the report data, reshoring exceeded FDI by 100%—a change from 2014 through 2019, when FDI exceeded reshoring—and the number of companies reporting reshoring and FDI projects set another record of over 1,800 companies. Texas and Tennessee led in the number of jobs announced, further securing the South as the U.S. region scoring the most reshoring and FDI jobs compared to the Midwest, West and Northeast. From 2010 to 2021, the South has accounted for more than half of the total reshoring and FDI jobs at 56%.

Government incentives, skilled workforce availability/training and under-utilized capacity accounted for the top positive domestic factors that have attracted companies to the United States while supply chain interruption, green considerations and quality/rework/warranty issues were the top negative factors.

Read more at IndustryWeek

Nickel Market Meltdown Sparks $456 Million Lawsuit Against the London Metal Exchange

The suit was filed Elliott Investment Management against the LME and its clearing house in the English High Court on June 1. “The LME management is of the view that the claim is without merit and the LME will contest it vigorously,” it said in the statement. The move by the activist investor ratchets up pressure against the LME, which has been widely criticized for its decision to halt trading and cancel bets. The LME is also facing a review by UK regulators after it undid billions of dollars of transactions and halted trading for over a week. The nickel market has been stuck in an extended limbo of low liquidity and volatility since the crisis.

Elliott’s lawsuit is challenging the decision to cancel trades, claiming it was “unlawful on public law grounds and/or constituted a violation of their human rights,” according to the statement. The statement didn’t elaborate what trades Elliott had executed or the impact of the cancellation. The claimants were Elliott Associates, LP and Elliott International, LP.

Read more at Fortune

No, You Aren’t Automatically Saving Money by Working From Home

Despite many companies setting April return-to-office deadlines, for the past month, U.S. office occupancy has held steady at roughly 43%, according to Kastle’s Back to Work Barometer that takes into account rates in 10 major cities. Many employees are pushing back against heading into the office not because of rising COVID caseloads, but arguing that their commutes are too expensive. In fact, a recent report from Deloitte found nearly 40% of millennials and a third of Gen Zers report that remote work has helped them save money.

While working from home means skipping the commute, it’s not free—especially when you take into account rising energy costs. Electricity costs in April alone were up 11% year over year, according to the Bureau of Labor Statistics’ Consumer Price Index. That increase might not be a big deal when you spend eight or more hours a day at the office soaking up that corporate A/C. But when workers are at home, the cost is on them. Not to mention the additional costs to power your computer, keep your work phone charged, and maybe even run a printer once a day or so.

Read more at Fortune

New Guidance from U.S. DOL on FMLA Leave for Mental Health Conditions

In connection with Mental Health Awareness Month, the United States Department of Labor (USDOL) has sought to assist employers in better understanding how to comply with the Family Medical Leave Act (FMLA) as it relates to mental health conditions. Accordingly, on May 25, 2022, the USDOL issued new guidance (Guidance) and frequently asked questions (FAQs) on providing FMLA leave to employees to address their own mental health conditions or to care for a covered family member with a mental health condition.

In the Guidance, the USDOL explains that a mental health condition can constitute a “serious health condition” under the FMLA when the condition requires either (1) inpatient care or (2) continuing treatment by a health care provider.