27 October 2020

1) Oil and gas companies are bringing record level of debt to bankruptcy court, making this year the worst oil bust in decades. Companies have brought $89 billion dollars of debt to bankruptcy court this year, compared to $70 billion during the last oil bust in 2014-16. While fewer companies have gone bankrupt this year, 84 compared with the historical high of 142 in 2016, each bankruptcy filing this year reported significantly higher debt. The average bankruptcy debt per company this year is $1.05 billion dollars so far, almost twice as much as the 2017 level of $576 million. But the worst isn’t over yet, it is expected that another 15 to 21 exploration and production companies will file for bankruptcy by the end of the year, pushing the related debt to more than $100 billion. Although crude prices have climbed back to around $40 a barrel, recovery remains tenuous, since energy bankruptcies was rising before the coronavirus pandemic wiped out global demand for crude and petroleum products such as gasoline and jet fuel.

2) Another tropical storm threatens the Gulf Coast again, as 2020 ties record for most named storms. Tropical Storm Zeta has formed in the western Caribbean and is drifting north promising to unleash wind, heavy rainfall and possible ocean surge as it approaches the U.S. Gulf Coast Tuesday night and Wednesday. The storm is most likely to come ashore on Wednesday at tropical-storm level or possibly as a hurricane. The landfall zone includes areas in Louisiana where hurricanes Delta and Laura hit as well as parts of Alabama hit by Sally. The hurricane season still has five weeks left, so the record for most named storms could fall. There are some indications that Zeta could sneak in some last-minute intensification before landfall, possibly becoming a Category 2 hurricane. Zeta’s eventual merger with a frontal system could bring a swath of three to four inches of rain or more into parts of the Southeast and Mid-Atlantic late in the week.

3) Walmart is suing the Justice Department and the Drug Enforcement Administration as a pre-emptive strike, anticipating a legal battle over the retailer’s responsibility in the opioid abuse crisis. Operating more than 5,000 pharmacies in its stores, Walmart says it is seeking a declaration from a federal judge that the government has no lawful basis for seeking civil damages from the company. The government blames Walmart for continuing to fill purportedly bad prescriptions written by doctors that the DEA and state regulators had enabled to write those prescriptions in the first place and continue to stand by today. In 2018, 46,802 people died from an opioid overdose, and health care providers across the country wrote prescriptions for opioid pain medication at a rate of 51.4 prescriptions dispensed per 100 people.

4) Stock market closings for – 26 OCT 20:
Dow 27,685.38 down 650.19
Nasdaq 11,358.94 down 189.34
S&P 500 3,400.97 down 64.42
10 Year Yield: down at 0.80%
Oil: down at $38.64

24 September 2020

1) California’s annual bout of fires has just added a new dimension to the state’s history. The Creek Fire has become the state’s single most massive wildfire in history by burning 286,519 acres in Fresno and Madera counties. Ignited on September the fourth, it has so far destroyed 855 structures and damaged 71 others. There are now 50 major fires across the West coast this week, so far claiming 26 fatalities, while consuming 2.2 million acres. There are forty crews with 3,100 personnel who are fighting the fires, but only about 32% of the Creek fire blaze has been contained. No estimates yet of just how much monetary damages the state has suffered.
2) As the remnants of Sally continue moving across the southeastern United States, the first estimates are in for the damages. Sally made landfall as a category 2 storm near Gulf Shores, Alabama bringing a storm surge that caused major flooding in places like Pensacola with several feet of water. Damages are expected to cost upwards of $2 billion dollars. NOAA’s aerial imagery is being evaluated to more accurately determine the extent of flooding and damages in Florida and Alabama. Major beach erosion is also apparent too.
3) Tesla’s much touted Battery Day appears to have disappointed most of the average people, with Tesla (TSLA) stock tumbling down 8.6% in midday trading, on track for its lowest close in two weeks. Investors fear that promised new batteries will take years to fully develop and be available for automobiles. Tesla unveiled a new battery design that is 56% cheaper and more efficient for use in automobiles, which should be a big step towards the viability of fully electric cars. Additionally, the company announced a future robot car for $25,000 that will be fully autonomous, and available in the next three years. The new battery technology will enable sleeker affordable cars that can travel much longer distances on a single charge. Investors had expected announcements of two big innovations, the first one is a ‘million mile’ battery that would be good for ten years or more, as well as a cost reduction, a target specified as dollars per kilowatt-hour, which would finally drop the price of an electric vehicle below that of a gasoline car.
4) Stock market closings for – 23 SEP 20:
Dow 26,763.13 down 525.05
Nasdaq 10,632.98 down 330.65
S&P 500 3,236.92 down 78.65
10 Year Yield: up at 0.68%
Oil: up at $39.59

MERCEDEZ BENZ US HEADQUARTERS IS RELOCATING… TO ATLANTA…

 

mercedez benz

By: Economic & Finance Report

 Luxury  car maker Daimler AG (Mercedes Benz) is relocating down to Atlanta. The US  headquarters in New Jersey will no more be in existence.

Executives and management indicated that the shift was provided because of lower costs, the tax breaks they would receive and the close proximity to their southern car plants which is located in the state of Alabama. 

The shifting of personnel is expected to occur in July 2015, which  will include 1,000 personnel movint to the suburbs of Atlanta.  Executives @ Daimler AG also indicated that the relocation made sense because of the dynamic presence of the south currently and the infrastructure renovation that Atlanta has be going through in the last few years, made the decision much easier to relocate US operations down south

-SB