JACK MA SEEMS TO BE REDUCING HIS MAJORITY STAKE IN ANT GROUP, REPORTED BY SOURCES……..

By: Economic & Finance Report

It seems that Chairman of Ant Group, Jack Ma is reducing his majority stake in the holding company. Sources have indicated that China and Ant Group are currently working on ways for Mr. Ma to sell off his majority stake in financial holding company.

Talks started to begin in early January 2021 between Chinese authorities and Ant Group leadership, that Ma would be eventually existing the company majority control. It is still up in the air if Mr. Ma will leave the entire company, but it does seem this may be the case, though not confirmed.

Key sources would like Ma’s shares to sold to Ant Investors or Alibaba investors, keeping the shares in house, but discussions are still proceeding if this will be the case. Jack Ma’s exit is coming when Alibaba was penalized with multi billion dollars in fines by the Chinese government. -SB

Source: Reuters

Image Credit: Reuters.com

26 March 2021

1) The U.S. Supreme Court, in a unanimous 8-0 ruling in a civil procedure case, has made corporations suffer a huge loss by making it easier to sue over defective and dangerous products. The basic thrust of the controversies is actually fairly simple in the case of Ford Motor Co. v. Montana Eighth Judicial District Court. The state court held that it had jurisdiction over Ford Motor Company in a product liability suit stemming from a car accident, since the accident happened in the state where suit was brought, and the victim was one of the state’s residents. Furthermore Ford did substantial business in the state with advertising, selling, and servicing the model of vehicle the suit claims is defective. Ford contends that jurisdiction is improper because the particular car involved in the crash was not sold in the state where Ford was sued, nor was it designed or manufactured there. The Supreme Court has essentially staked out two methods for bringing lawsuits against huge corporations: 1) general jurisdiction, and 2) specific jurisdiction. When minimum contacts are found to be sufficiently related to the cause of action, a given court may exercise jurisdiction over such claims.

2) Taiwan and the U.S. plan to deepen maritime security ties in view of China’s escalating ‘gray-zone’ threats. The Chinese government has made vast maritime claims in the South China Sea and also claims sovereignty over the Japanese controlled Senkaku Islands, which it calls Diaoyu. Until Beijing enacted its new coast guard law last month, the country relied on its myriad of armed fishing militia to harass the vessels of other regional claimants. However, China’s neighbors have raised concerns about the revised maritime police legislation, which allows coast guard ships to fire upon foreign vessels deemed to be intruding in Chinese territorial waters. Manila and Tokyo, both who are U.S. defense treaty allies with the U.S., have expressed concern at the potential consequences of the law.

3) Google’s systems infrastructure group calls their new Systems on Chip (SoC) the motherboard on a chip. The cloud computing giant, who is always in need of more computing power for its servers, until now relies on the motherboard as an integration point, where CPUs, networking, storage devices, custom accelerators and memory all come together. To gain higher performance and to use less power, workloads demand even deeper integration into the underlying hardware. With the SoC, the latency and bandwidth between different components can be orders of magnitude better, with reduced power and cost compared to traditional motherboards.

4) Stock market closings for – 25 MAR 21:

Dow Jones 32,619 up by 199.42
NASDAQ 12,978 up by 15.79
S&P 500 3,910 up by 20.38

10 Year Yields: up at 1.635

Oil: down at 61.84

19 March 2021

1) American military officials are warning that, in the next few years, China could invade Taiwan. The island nation has long been a sore subject of U.S.-China relations. China’s rapid military build-up, are recent indications that Taiwan could unilaterally declare its independence from the mainland. An invasion could throw the whole region into chaos and potentially culminate in a shooting war between China and the United States, who is treaty bound to help Taiwan defend itself against Beijing. The Chinese army’s capabilities have matured to such a degree that this is no longer a dilemma we can afford to brush off. The Biden administration must signal its willingness to ‘go to the mat’ for Taiwan and help ensure the island can defend itself, but without further spooking Beijing. China has commissioned 25 advanced new ships, including cruisers, destroyers and ballistic missile submarines, with capabilities designed to keep America and its allies, who might interfere on Taiwan’s behalf, at bay. Meanwhile, China is integrating its new equipment into an increasingly sophisticated force

2) Production at U.S. manufacturers unexpectedly declined in February, representing a pause in recent momentum as factories were beset by severe winter weather and supply-chain challenges. The 3.1% decrease in output was the first since April, following an upwardly revised 1.2% gain in January. Total industrial output reflected a 7.4% surge at utilities, that was the largest advance since March 2017, also driven by increased demand for heating. Manufacturers continue to battle supply shortages and shipping challenges, but lean business inventories, steady demand from consumers and solid capital spending should push manufacturing back up.

3) A Tesla Model Y electric car, with its Autopilot engaged, crashed into a Michigan police car that had pulled over with its lights on. The driver was using Tesla’s Autopilot system when he crashed into the police vehicle, but there were no injuries, according to police. The 22-year-old driver was issued citations for failure to move over and driving with a suspended license. Tesla’s Autopilot system allows the car to brake, accelerate, and steer automatically. The electric car maker also sells its full self-driving software as a $10,000 one-off add-on and plans to release it as a subscription model this summer.

4) Stock market closings for – 18 MAR 21:

Dow 32,862.30 down by 153.07
Nasdaq 13,116.17 down by 409.03
S&P 500 3,915.46 down by 58.66

10 Year Yield: 1.73%

Oil: down at $59.53

8 March 2021

1) Walt Disney Co. will close at least 60 Disney stores in North America this year, which amounts to about one-third of their stores. Like so many other retailers, Disney has found that shopping has changed because of the coronavirus pandemic- and so has Disney’s entire business with its theme parks closed to some extent. But Disney+ streaming service has blossomed to 94.9 million subscribers. Disney’s revenue in the October to December quarter fell 22% to $16.25 billion from $20.88 billion in the previous year but still beat Wall Street expectations.

2) General Motors said it’s exploring the possibility of a second battery production site in the country, the first is its facility in Lordstown, Ohio, a site it will operate with partner LG Chem. Reports are that GM is interested in a second site in Tennessee, as a venture with Korea’s LG. The Ohio operation is set to open next year with enough capacity to build hundreds of thousands of batteries per year. The automaker is keen to quickly capitalize on a shift to electric vehicles and said it aspires to only sell zero-emissions, light-duty vehicles by 2035, including light-duty pickup trucks. The Ohio plant may be a down payment on this EV future, in which the automaker has invested $2.3 billion.

3) Lumber prices have skyrocketed 140% over the last year, although the economy might not be able to handle further increases in 2021, nevertheless lumber is the best performing commodity. Analyst predict lumber prices could gain another 35% in the next year. Rising lumber prices are from the pandemic induced housing boom, fueled by record low mortgage rates and a mass exodus to the suburbs. It’s a sign that the economy is recovering, but if prices of lumber and other commodities continue to rise quickly, the economy might falter, as prices move higher driven by demand, while supply will continue to shrink. Worker wage increases haven’t been keeping pace with the dramatic spike in all the commodities at this point in time. With interest rates going up and all these inflationary commodities advancing in price, there are growing fears of people being self-sustaining when wages remain static.

4) Stock market closings for – 5 MAR 21:

Dow 31,496.30 up by 572.16
Nasdaq 2,920.15 up by 196.68
S&P 500 3,841.94 up by 73.47

10 Year Yield: unchanged at 1.55%

Oil: up at $66.28

1 March 2021

1) The superstore Fry’s Electronics suddenly closed all of its stores overnight, ending a nearly four-decade run in business. Fry, which had 31 stores across nine states, said that it made the difficult decision to shut down its operations and close its business permanently because of changing consumer shopping habits and the ongoing Covid-19 pandemic. The Silicon Valley retail electronics store provided a ‘one stop shopping’ environment for the hi-tech professional market. The retailer didn’t implement and expand its online operations as rapidly as larger rivals. Best Buy, for example, recently reported its best quarter in 25 years as home bound customers snapped up laptops, home theater systems and kitchen appliances. The electronic retailer had been in business for 36 years.

2) Communications giant AT&T is spinning off its DirecTV into a new company for a fraction of the $48.5 billion dollars it paid for the satellite TV service in 2015. DirecTV has lost millions of customers. The value in the deal is just $16.25 billion, including its debt. The private equity firm TPG will own 30% of the business, while AT&T holds the rest. The telecom company will receive $7.8 billion in cash, including $1.8 billion from TPG and and $5.8 billion from the new DirecTV firm, which is borrowing that sum. The new DirecTV will also take on $200 million in debt from AT&T. AT&T launched its streaming service HBO Max last year and is focused on building that business. It also owns TV networks like CNN and TBS along with the Warner Bros. movie studio in addition to its huge wireless and internet business. The new DirecTV company will include AT&T TV, a streaming version of cable TV, and U-verse, AT&T’s older cable service. AT&T will retain its Latin America DirecTV business. AT&T said it expects few to no changes for subscribers.

3) Lockheed Martin is preparing to close its Middle River facility, in Maryland, which supports small combatants and ship systems programs, including the MK 41 Vertical Launching System (VLS), next generation launching systems, ship controls and automation and Littoral Combat Ship (LCS) engineering and sustainment. The company will reportedly relocate the business that is located in Middle River, Maryland to other Rotary and Mission Systems facilities. In an ongoing effort to drive down costs for customers and increase efficiency and value, Lockheed Martin consolidating some operations in their Rotary and Mission Systems business to better align employees, technology and facilities to meet customer needs. The majority of employees will be offered the opportunity to relocate or, if possible, telework. Lockheed Martin currently employs more than 3,150 people in Maryland, with 32 facilities and 569 suppliers, supporting nearly 100 small businesses across the state.

4) Stock market closings for – 26 FEB 21:

Dow 30,932.37 down by 469.64
Nasdaq 13,192.34 up by 72.91
S&P 500 3,811.15 down by 18.19

10 Year Yield: down at 1.46%

Oil: down at $61.66

26 February 2021

1) The pandemic has been especially hard on small business, who don’t have the cash reserves of large corporations. They face a number of challenges they need to meet in order to survive. Here is a brief list of challenges they face- 1) The Ability to Transition to a Digital First World 2) Lack of In-Person Networking Events 3) Forward Planning is Difficult 4) Leaving Brick and Mortar Stores. 5) Lacking Work Life Balance 6) Increased Shipping Costs 7) Lacking Creativity 8) Blips in Production 9) Pressure to Perform 10) Long Term vs. Short Term Content

2) More than 4 million barrels of daily oil output, which is almost 40% of the nation’s crude production, is now offline because of the deep freeze weather. One of the world’s biggest oil refining centers has seen its output drastically cut back. Experts say the market is underestimating the amount of oil production lost in Texas due to the bad weather. Crude oil briefly surged above $65 a barrel, a level not seen since last January. Supply tightness has also soared, where just ten months ago, the price slumped below $16 because of a demand shock caused by Covid-19. Estimates for how long the outages may last have gotten progressively longer as analysts try to figure out the time span involved in thawing out infrastructure, especially in those areas where freezing weather isn’t the norm. That means ever more barrels are being removed from the global market, resulting in a surge in price of crude in other parts of the world.

3) Another long time retailer chain has filed for bankruptcy, as the Covid-19 pandemic makes the retail industry the site of regular closures and financial woes. Now, regional department store Belk, the nation’s largest privately owned department store, can be added to the ‘dead’ list, with the closing of all its stores. The bankruptcy filing for the 133 year old retailer comes about half a decade after the founding Belk family sold the company to its current owners for $3 billion dollars. The pandemic directly resulted in the drastic declines in the retailer’s sales, revenue, and liquidity. Unfortunately, Belk is far from the only shopping mainstay to struggle under the pressures of the pandemic. The company’s bankruptcy plan was filed in a Houston courtroom on Feb. 23, which relieves Belk of $450 million worth of debt and create an infusion of capital for the business.

4) Stock market closings for – 25 FEB 21:

Dow 31,402.01 down by 559.85
Nasdaq 13,119.43 down by 478.53
S&P 500 3,829.34 down by 96.09

10 Year Yield: up at 1.52%

Oil: down at $63.31

24 February 2021

1) The employees at Boeing Commercial Airplanes headquarters have been told to clear out their belongings as the coronavirus pandemic has increased the viability of working remotely. The aerospace giant has its Commercial Airplanes headquarters there and has hinted it could sell the facility as a cost cutting measure, although the company hasn’t unveiled its plans publicly. Boeing continually assesses the company’s entire portfolio of real estate property assets and adjusts the company’s footprint as the business environment evolves. Boeing Commercial Airplanes leadership will remain in the Puget Sound region. As Boeing adapt to new market realities and position for the future, they are taking action across the company in five key categories: infrastructure; overhead and organizational structure; portfolio and investment mix; supply chain health; and operational excellence. That involves a look at the costs of maintaining some office space. Boeing can offer more flexibility for their teammates with a combination of virtual and on-site workspace, while also ensuring that leaders and teams are closer to where the work is being done to support customers.

2) In late December, the activist investment firm Engine No. 1 announced that it had the support of the California State Teachers’ Retirement System for the firm’s slate of four candidates for election to the board of directors of Exxon Mobil Corp. Engine No. 1’s stake is less than 0.02%. Like many other oil producers, Exxon cites the role of carbon capture in reducing carbon emissions by the end of the century. Exxon’s stated goal of an 11% to 13% reduction in emissions by 2025 is misleading, according to the firm. That goal does not include what are called Scope 3 emissions, the carbon emitted from burning the oil and gas products a company sells. The investment firm claims that Scope 3 emissions account for about 83% of Exxon’s total emissions.

3) American made solar panels cannot compete with Chinese prices as the demand for green energy increases under the Biden administration. American companies must compete on quality, so must make sure that everything done here is up to a higher standard than anywhere else. Two thirds of all of the world’s solar panels are produced in China, with only a few companies that manufactures panels in the U.S. As it stands now, with America attempts to be self sufficient with energy, we are dependent on to China to supply the bulk of solar panels.

4) Stock market closings for – 23 FEB 21:

Dow 31,537.35 up by 15.66
Nasdaq 13,465.20 down by 67.85
S&P 500 3,881.37 up by 4.87

10 Year Yield: down at 1.36%

Oil: up at $61.32

18 February 2021

1) Demand for natural gas is currently at an unprecedented level according to Atmos Energy, because of freezing rain, snow, ice and dangerous travel conditions. Atmos Energy is asking all of its customers and businesses to conserve as much energy as possible. The Dallas-based natural-gas-only company is one of the nation’s largest distributors, serving about three million customers in more than 1,400 communities in nine states. This request comes after a new Winter Storm Warning was issued for all of North Texas while millions in the state remain without power. Atmos Energy has offered their customers a number of suggestions on how they can limit their energy usage.

2) Texas produces more energy than any other state, yet in the midst of the arctic freeze gripping the central U.S., Texas is faced with insufficient energy for its citizens. The arctic freeze gripping the central U.S. is raising the specter of power outages in Texas. The deep freeze this week in the Lone Star state, is causing power demand to skyrocket. The people of Texas relies on electricity to heat many homes, while at the same time, natural gas, coal, wind and nuclear facilities in Texas have been knocked offline by the unthinkably low temperatures. This situation could have wide-reaching implications as the US power industry attempts to slash carbon emissions in response to the climate crisis and move away from fossil fuels. Texas has been hit with life-threatening blackouts. More than 4 million people in the state were without power early Tuesday. Authorities defended the controlled outages, called rolling blackouts, which kept the grid from collapsing. The situation raises the question that if a state like Texas is now having trouble meeting its energy requirements, then how will the other states fare as America moves to a green energy environment.

3) Motorola Solutions has consolidated its video security and AI video analytics production into a newly renovated manufacturing facility in Richardson Texas, with plans to expand staffing in the coming year. The new facility opened in January housing 250 employees, with plans to expand by at least another 50 this year. Motorola acquired the camera and analytics company Avigilon, for a reported $1 billion in February 2018 and the Fort Worth based license plate recognition camera and software maker Vigilant Solutions in January for $445 million. In March 2019, it bought voice-over IP dispatch console maker Avtec, then Watchguard, which designs and sells in-car video systems and police body cameras to law enforcement agencies. Two additional California-based companies Pelco and Scotland-based IndigoVision were also added to Motorola’s growing security abilities.

4) Stock market closings for – 17 FEB 21:

Dow 31,613.02 up by 90.27
Nasdaq 13,965.50 down by 82.00
S&P 500 3,931.33 down by 1.26

10 Year Yield: unchanged at 1.30%

Oil: up at $61.66

#EFRPodcast Ep. #38 feat. Professor Helmut Norpoth: Model Gone Wrong!!!!

By: Economic & Finance Report

www.yotube.com/Economic&FinanceReportEFRTV

www.soundcloud.com/Economic-FinanceReport

1 February 2021

1) While on the campaign trail, the new President Biden didn’t say much about space technology or projects. The space agency funding makes up just 0.4% of the national budget compared to 4% back in the mid-1960s. The Congress has not provided the funds for a earth to moon vehicle yet, so this raises the question of just how much will the new President support the space program. With Biden’s focus on the planet and global warming, concerns about worlds beyond earth appear to be diminishing. NASA already supports the earth sciences with its satellites and aircraft, and with the massive federal spending this last year, the Congress and maybe the President will seek to reduce spending so NASA may face cuts these next few years.

2) The automaker Dodge is warning that regulations are killing the V8 engine. They say the days of an iron block supercharged 6.2 liter V8 are numbered because of all the compliance costs. The Biden administration is widely expected to announce stricter emissions regulations in the near future. But electrification can help ensure muscle car enthusiasts don’t suddenly loose their passion, that we’ll start seeing battery-powered drive trains with massive horsepower for cars . . . electric muscle cars.

3) It is expected that 10,000 stores will close by the end of 2021 due to COVID-19. Consumers are increasingly favoring the convenience and safety of shopping online during the pandemic. This is a 14% jump in the retail industry closures from last year, when a record number of major vendors closing more than 8,700 stores. Businesses that sell apparel accounted for the most store closures in 2020. More than 3,000 clothing, footwear and accessories stores were shuttered last year, with Ascena Retail Group (brands Ann Taylor and Lane Bryant), closing more than 1,100 of its store locations. However, virtually no category of retail business was spared, with discount home and office retailer Pier 1 Imports filing for bankruptcy and closed all 936 of its stores. As of January 22, nearly 1,700 retailers have already closed. Other retailers are closing with 7-Eleven closing 300 stores, Family Video is closing its remaining 250 locations, ending its 42-year-old run. Ascena Retail Group will also close 195 brick-and-mortar stores in 2021.

4) Stock market closings for – 29 JAN 21:

Dow 29,982.62 down by 620.74
Nasdaq 13,070.70 down by 266.46
S&P 500 3,714.24 down by 73.14

10 Year Yield: up at 1.09%

Oil: down at $52.15