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7f5f1d98b40af8f94bf27a22d3a36164 | https://www.cnbc.com/2018/05/18/34-chilean-bishops-offer-resignation-to-pope-over-abuse-scandal.html | 34 Chilean bishops offer resignation to Pope over abuse scandal | 34 Chilean bishops offer resignation to Pope over abuse scandal
Pope Francis arrives at the United Nations in New York, September 25, 2015.Tony Gentile | Reuters
All 34 Chilean bishops who attended a crisis meeting this week with Pope Francis about the cover-up of sexual abuse in their country have offered their resignation, the bishops said in a statement released on Friday. It was not immediately clear if the pope had accepted their resignation. "We have put our positions in the hands of the Holy Father and will leave it to him to decide freely for each of us," the bishops said in their statement, in which they also apologized to Chile, the victims of abuse and the pope for the scandal.
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e805109b65f061f4bde3876a2095a0f7 | https://www.cnbc.com/2018/05/18/barely-any-bitcoin-left-in-ark-etfs.html | ETF Spotlight | ETF Spotlight
A woman pays for her coffee with cryptocurrency at Ducatus cafe, the first cashless cafe that accepts cryptocurrencies such as Bitcoin, in Singapore December 21, 2017.Edgar Su | Reuters
Just over a month ago, the ARK Innovation ETF (ARKK) took home ETF.com's "ETF Of The Year" award for delivering on its purpose of serving up access to disruptive technology in 2017, and doing so really well.
Crucial to that recognition was its unique allocation to bitcoin. For much of the fund's history, that allocation was relatively stable in number of shares, and hovered between 6 percent and 10 percent of the portfolio, according to FactSet data. Bitcoin often led the list of top holdings in ARKK. Only one other ETF on the market offered parallel access to bitcoin — ARKK's internet-focused counterpart ARK Web x.0 ETF (ARKW).
More from ETF.com:
The next bond crash: An ETF story Why I don't use target date funds
World's cheapest 'do good' ETF
Bitcoin, accessed through the Bitcoin Investment Trust (GBTC), was a major driver behind both these funds' returns last year. ARKK and ARKW were each up more than 87 percent in 2017. GBTC itself was up a whopping 1,550 percent.
Here's the ETFs' rally last year, and that impressive rally relative to GBTC's, in two charts:
But these ETFs' big bet on bitcoin is no longer the case. In mid January of this year, ARK began trimming exposure to bitcoin in both funds, and today bitcoin represents only 0.5 percent and 0.6 percent in ARKK and ARKW, respectively. The cryptocurrency is almost a negligible allocation in these portfolios now.
Why? According to ARK, the "complicated decision" to dramatically trim bitcoin exposure was more driven by regulatory and tax-related concerns than by the "merits" of bitcoin itself.
But performance probably played a major role in this portfolio shift. Bitcoin — as measured by GBTC — rose dramatically in 2016 and in early 2017, and then began to fall later in the year. So far in 2018, GBTC has already dropped 37 percent, bringing its losses from its mid-December 2017 high to more than 63 percent in just five months. (ARKK and ARKW are each up about 15 percent year-to-date.)
VIDEO10:1610:16Early bitcoin investor reveals which cryptocurrencies he would HODL or FODLFast Money
It could very well be that ARK was simply taking profits on its bitcoin allocation earlier this year, and has been trimming that position since as bitcoin prices continue to struggle. If GBTC price performance did in fact motivate the move, any recovery in bitcoin prices could mean an increase in allocation down the road.
For now, however, given that the Securities and Exchange Commission has yet to approve the launch of a bitcoin ETF — many issuers have thrown their hats into that ring — investors who want access to the cryptocurrency through an ETF wrapper have slim pickings at best.
— By Cinthia Murphy, ETF.com. Contact Cinthia Murphy at cmurphy@etf.com
To get the latest ETF news in your inbox, sign up for ETF.com’s ETF newsletter.
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924b9c15b4f1a3a636ae6defc95cf96c | https://www.cnbc.com/2018/05/18/bonds-are-way-oversold-at-this-point-market-watcher-says.html | Bonds are way oversold at this point, market watcher says. Here’s what that means | Bonds are way oversold at this point, market watcher says. Here’s what that means
VIDEO1:1601:16Bonds are way oversold at this point, market watcher says. Trading Nation
Bond yields hit the accelerator again this week with the 10-year Treasury hitting its highest levels since mid-2011.
Bond prices, which move inversely to yields, are now looking oversold, said Larry McDonald, editor of the Bear Traps Report. He told CNBC's "Trading Nation" on Thursday what this could mean for bond markets.
The U.S. 10-year yield is much higher than in Japan and Germany, but a global shortage of dollars has increased the cost of hedging these bonds.Even though U.S. yields are relatively high, they're less competitive to Treasurys overseas because of those global hedging costs.This is putting dramatic selling pressure on the 10-year and starting to upset the market.The U.S. 10-year Treasury yield should hit 4 percent this year.The spot between a 3.1 percent and 3.15 percent yield offers a good buying opportunity on the TLT long bond ETF. Bottom line: Non-U.S. bonds look more competitive and will continue to pressure U.S. 10-year bonds.Correction: This story was revised because the strategist says he meant to recommend the TLT long bond ETF as a good buying opportunity.
Disclaimer
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470942f1f0149eaab7cdfa40e0be8b03 | https://www.cnbc.com/2018/05/18/cambridge-analytica-files-for-bankruptcy-in-us-following-facebook-debacle.html | Cambridge Analytica files for bankruptcy in US following Facebook debacle | Cambridge Analytica files for bankruptcy in US following Facebook debacle
Cambridge Analytica, the political consultancy at the center of Facebook Inc's privacy scandal, filed for Chapter 7 bankruptcy in the United States late on Thursday.
This past March allegations surfaced that Cambridge Analytica, hired by President Donald Trump's 2016 U.S. election campaign, improperly used data of 87 million Facebook users beginning in 2014.
Cambridge Analytica and its British parent SCL Elections said earlier this month that they would shut down immediately and begin bankruptcy proceedings after suffering a sharp drop in business.
The petition to file bankruptcy was submitted at the U.S. Bankruptcy Court Southern District of New York and was signed on behalf of Cambridge Analytica's board by Rebekah and Jennifer Mercer, daughters of billionaire Robert Mercer.
The Mercer family was one of Trump's biggest donors.
Cambridge Analytica listed assets in the range of $100,001 to $500,000 and liabilities in the range of $1 million to $10 million.
London-based Cambridge Analytica was created in 2013 initially with a focus on U.S. elections, with $15 million in backing from Mercer and a name chosen by former Trump White House adviser Steve Bannon, according to a report by The New York Times.
Facebook has faced multiple investigations in the United States and Europe over its handling of personal data of users, hurting shares of the Mark Zuckerberg-led company.
Zuckerberg has appeared before U.S. congressional committees to testify on data privacy and will meet leaders of the European Parliament soon.
Facebook said on Monday it has suspended around 200 apps in the first stage of its review into apps that had access to large quantities of user data before the company restricted data access.
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3ee1fbf7389ba5a4971e4c5089685e0c | https://www.cnbc.com/2018/05/18/david-tepper-gets-us-approval-to-take-activist-stance-on-allergan.html | David Tepper gets US approval to take activist stance on Allergan, if he wants it | David Tepper gets US approval to take activist stance on Allergan, if he wants it
David TepperDavid Orrell | CNBC
Allergan could face activist pressure from David Tepper's Appaloosa Management after the Federal Trade Commission cleared the way for him to build on his stake in the drugmaker.
Shares rose 3.7 percent on Thursday but were trading down Friday after the disclosure on the FTC's website on Wednesday.
The approval allows Appaloosa to acquire more shares of Allergan, in which it already has a 1 percent stake of 3.7 million shares, according to FactSet's count. Allergan's shares are down nearly 27 percent over the last 12 months.
VIDEO6:2506:25Appaloosa's David Tepper: I don't see overvaluation in the marketHalftime Report
Investors who want to take an activist stance by engaging with company management have to abide by FTC rules that require approval for anyone taking a stake greater than $84 million. At $593 million, Appaloosa is already well past that threshold, but the approval gives it flexibility if it decides it wants to become more than a passive investor.
Tepper's Appaloosa has been making changes to its holdings, disclosing earlier this week it exited a 4.6 million share stake in Apple and a 1.98 million share stake in Comcast and added new stakes in Applied Materials and Wells Fargo. It started building its Allergan stake in 2015.
Tepper is also in a $2.2 billion deal to buy the Carolina Panthers professional football team.
A spokesman for Appaloosa said he had no comment on the Allergan approval.
Allergan, the maker of Botox and Juvederm, began a strategic review of its business earlier this year, including possible sales of business units or a splitting up of the company.
CEO Brent Saunders said on a conference call in April, "While the board continues to evaluate the options, my preliminary view is that a fundamental shift in the overall business strategy is not necessary."
A spokeswoman for Allergan said the company "welcomes all investments in our company."
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6bd9f137dd162f7935e296646473f0b2 | https://www.cnbc.com/2018/05/18/egypts-sisi-orders-gaza-border-opened-for-ramadan.html | Egypt's Sisi orders Gaza border opened for Ramadan | Egypt's Sisi orders Gaza border opened for Ramadan
Egyptian President Abdel Fattah al-SisiKhaled Desouki | AFP | Getty Images
Egyptian President Abdel Fattah al-Sisi ordered on Thursday that the Rafah border crossing with the Gaza Strip be opened for the whole of the Muslim holy month of Ramadan, he said on his official Twitter account.
The border with the Palestinian territory is mostly shut but opens at regular intervals. This would be the longest single opening in years. Sisi's Twitter account said the opening of the crossing would "alleviate the burdens of brothers in Gaza."
Israeli troops killed dozens of Palestinians on Monday who protested on the Gaza border as the United States opened its embassy in Jerusalem, moving its diplomatic mission in Israel to the contested holy city from Tel Aviv.
Islamist group Hamas controls Gaza, but not its most important crossings, Rafah with Egypt and Erez with Israel. It handed control of those crossings late last year to its rival, the West Bank-based Palestinian Authority, in a reconciliation deal signed in Cairo.
Egypt closed the border for long periods after attacks on Egyptian security forces in the Sinai Peninsula that increased in 2013, with Egyptian officials blaming Palestinian militants from Gaza for some of them.
VIDEO1:2401:24The economy of RamadanCNBC Reports
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d6094cbb0cc88ebc30f091a1f92dbadf | https://www.cnbc.com/2018/05/18/emerging-markets-are-in-a-correction--some-call-the-stocks-a-buy.html | Emerging markets are trading in correction territory — but some call the stocks a buy | Emerging markets are trading in correction territory — but some call the stocks a buy
VIDEO3:0003:00Trading Nation: Emerging markets under pressureTrading Nation
Emerging market stocks fell deeper into correction territory on Friday and were on track for their worst week in nearly two months.
But some see opportunity — if you have the stomach.
"These emerging markets stocks are always going to be a higher volatility play, so you have to be willing to deal with both the ups and the downs," Mark Tepper, president and founder of Strategic Wealth Partners, told CNBC's "Trading Nation" on Thursday. "There's a lot of value in emerging markets stocks right now."
Exposure to emerging markets is a sure bet on the consumer, Tepper added.
"The emerging market consumer is still one of the most powerful forces in investing," he said. "The growth of the middle class in China and India, it just represents a ton of potential."
Geopolitical issues, such as talk of a trade war between the U.S. and China, will keep emerging sector stocks under pressure in the short term, added Tepper. The MSCI emerging markets ETF is on track for a 2 percent decline in 2018, its first year in the red since 2015. The ETF is setting up for its third month of losses this year.
Tepper says the best way to make a play on emerging markets, while avoiding geopolitical pressure, is through the DGS emerging markets small cap dividend fund.
It's a "great dividend play, it gives you some lower beta and at the same point in time these small-cap stocks are doing business locally, not internationally, so they wouldn't be impacted by any trade issues whatsoever," he said.
The DGS ETF is down 0.7 percent for the year, more than half the decline on the MSCI emerging markets ETF.
Larry McDonald, editor of the Bear Traps Report, has a different take on the bull case for emerging markets.
"With bond yields moving higher, there are a lot of losses around the country, around the world in bonds. Those assets have to move somewhere and they're moving into commodities, commodity-producing countries," McDonald said on Thursday's "Trading Nation." "About 30 percent of Brazil's GDP is related to the commodity space, so from an economic standpoint, that's a very big positive."
The MSCI Brazil ETF EWZ is down 5 percent in 2018 and is down 20 percent from its 52-week high set on Jan. 25. The EWZ ETF was on pace for its worst week in a year.
Disclaimer
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8bc750b4cba536109b941ace91c096da | https://www.cnbc.com/2018/05/18/energy-stocks-are-doing-something-they-havent-done-in-12-years.html | Energy stocks are on their longest winning streak in 12 years, and there's more room to run | Energy stocks are on their longest winning streak in 12 years, and there's more room to run
VIDEO3:2503:25Energy stocks are doing something they haven’t done in 12 years. Here’s what to expect nextTrading Nation
The XLE energy ETF just posted its 10th straight day of gains, its longest daily winning streak since 2006. Some see even more room to run.
"We're high conviction overweight," Mark Tepper, president and founder of Strategic Wealth Partners, told CNBC's "Trading Nation" on Thursday. "You look at these escalating geopolitical risks with Iran and that could lead to oil supply issues down the road, so that's obviously going to add a premium to prices."
Oil prices have been on a tear over the past month as the possibility rose of sanctions against Iran. President Donald Trump announced last week that he was withdrawing from the Iran nuclear deal and that he would restore sanctions against the Middle Eastern country. As of Thursday, West Texas Intermediate crude had risen 2 percent since then.
"Look at the difference between oil price appreciation versus the XLE price appreciation," said Tepper. "Oil is up 40 to 50 percent year over year and it's up over 20 percent year to date and we do see an additional 10 to 15 percent upside before the end of the year. Energy stocks haven't done quite as well. The XLE is up 9 percent this year and it's up 17 percent year over year."
Brent crude oil traded above $80 a barrel on Thursday for the first time since November 2014. WTI ended at $71.49 a barrel, levels not seen in more than three years. Friday morning, Brent was at $79.62 and WTI was $71.56. The energy sector is the second-best performer on the S&P 500 this year.
Another long-time energy bull is beginning to lighten his exposure to the sector as investors pile into the space.
"We've been pounding the table on the XLE and the energy space," Larry McDonald, editor of the Bear Traps Report, said on Thursday's "Trading Nation." "The awareness level of the bull case is very, very well known right now. Extreme overbought conditions … so we've been selling shares this week and we're lightening up on your energy position."
The XLE's relative strength index has spiked to above 80, suggesting overbought conditions. A reading above 70 typically separates normal from overbought levels. The XOP S&P oil and gas exploration and production ETF has an RSI of 78.
Disclaimer
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8db4a5eae566f86c04f2fa44f4603c90 | https://www.cnbc.com/2018/05/18/facebook-royal-wedding-quiz-could-put-you-at-risk-for-identity-theft.html | Facebook royal wedding quiz could put you at risk for identity theft | Facebook royal wedding quiz could put you at risk for identity theft
Masks of Prince Harry and his fiance, US actress Meghan Markle sit in the window of a gift shop on May 10, 2018 in Windsor, England.Getty Images
SAN FRANCISCO — A funny as Lord Carpenter Rover of Sunnyside might sound, please don't reply to a Facebook prompt asking you to create your royal wedding guest name using details from your past.
Facebook is always awash in sharable quizzes and prompts (remember 'Tell us your first 10 rock concerts' last year?) and this week's suggestion inspired by the pending wedding of Meghan Markle and Prince Harry is no different. But it also puts you in real danger of identity theft.
It sounds innocuous enough. Much as other, more adult, prompts have asked users to create and forward along their "porn star" name, this one helps you craft an aristocratic title from seemingly innocuous items from your family and your past.
More from USA Today:Cambridge Analytica files for Chapter 7 bankruptcy liquidation after debilitating scandalRoyal wedding is the stage to display the best British cars like Rolls-Royce, JaguarsMillions flow to fast-growing lobbying firms with ties to the Trump administration
"In honor of the royal wedding," it reads, "use your royal wedding guest name this week. Start with either Lord or Lady. Your first name is one of your grandparents' names. Your surname is the name of your first pet, then "of" followed by the name of the street you grew up on. Just for fun, let's do this! Post below. Then cut and paste it into your status."
It's all fun and games until somebody gets hacked, which is why you're more than welcome to say the name aloud and giggle, but by no means should you cut and paste into your status.
Why?
Because your peerage name is an excellent hunting ground for any and all hackers looking to harvest the answers to those pesky online security questions more and more sites make you come up with.
First Pet? Mother's maiden name? The street you grew up on?
All very common security questions and all exactly the information you don't want to be publicly posting.
We don't know who started this particular meme making the rounds or whether they had the best, or the worst, intentions.
It doesn't really matter. Once you post those answers, you should assume that every hacking group worth its salt will find and index them quicker than Harry and Meghan can say "I do." This material is key to getting inside your online accounts.
The best response to online quizzes, at least when it comes to posting the answers, is "just say no." The same goes for shared, anonymously sourced quizzes on favorite books, musical styles, concerts, flowers and pretty much anything else that could be used against you.
Sorry to be a party pooper but it's the world we live in.
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8b0b7e319a567ddd6c32940d9097c83d | https://www.cnbc.com/2018/05/18/fugees-founder-brings-blockchain-to-your-smartphone.html | Grammy-winning Fugees founder bringing blockchain to your smartphone | Grammy-winning Fugees founder bringing blockchain to your smartphone
VIDEO4:5204:52Fugees founder Pras Michel launches BlactureSquawk Box
Grammy-award winning rapper and founding member of the Fugees Pras Michel is launching a blockchain-enabled smartphone that lets users earn dividends on every purchase.
The phone is part of Michel's digital platform Blacture, which was announced in a 2018 Super Bowl ad, and celebrates black culture through content and technology. The first retail move for Blacture is the launch of Motif, a $300 smartphone that hits stores this fall.
"When you use the phone you'll get paid and you can convert it into cash," Michel told CNBC'S "Squawk Box" on Friday. "Blockchain is the technology."
Michel said Motif users will earn a percentage on every purchase when they pay using their phone, which unlike airline miles can be redeemed for cash. The phone can also be linked to a Blacture debit card. Motif partnered with tech company Zippie, and Michel said the group is in talks with the top four U.S. phone carriers.
Michel founded the Fugees with Wyclef Jean and Lauryn Hill, and the group went on to win two Grammys for "Killing Me Softly" in 1996. The rapper wouldn't say whether or not he owns any cryptocurrency. But Michel knew about it well before bitcoin's meteoric rise to $20,000 last year.
"A friend of mine introduced bitcoin to me when it was at 11 cents," he said. "I didn't believe in it then."
Bitcoin was the first use-case for blockchain but advocates say the technology has the power to disrupt industries from health care to the music business. In a blockchain, transactions are recorded on what's known as a "distributed ledger," which can be accessed but not altered by the public.
Michel's phone is not the only one using blockchain technology. Foxconn is making one for Sirin Labs called the "Finney," which reportedly ships in October.
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80bc5d3542b425424148cf977b3ec716 | https://www.cnbc.com/2018/05/18/goldman-sachs-investors-missing-out-on-rare-oil-fueled-commodity-rally.html | Commodities are posting their best returns in a decade and Goldman thinks there's more to come | Commodities are posting their best returns in a decade and Goldman thinks there's more to come
Jeff Currie, head of commodities research at Goldman Sachs.Adam Jeffery | CNBC
Goldman Sachs warns that investors are starting to cool on commodities and could miss out on further gains for the year's best-performing asset class.
Earlier this week, the bank raised its outlook for its commodities index, which tracks assets like crude oil and copper. It now thinks the Goldman Sachs Commodities Index will return 8 percent over the next 12 months, up from its previous forecast for a 5-percent gain.
Commodities are now posting their best year-to-date gains in a decade, according to Goldman. The fuel for that performance is crude oil. International benchmark prices have risen more than 51 percent over the last year, while the cost of U.S. crude is up nearly 45 percent.
"The rally likely has room to run, particularly from a returns perspective. Oil fundamentals are now more bullish as robust demand faces supply disappointments," wrote Jeffrey Currie, Goldman's global head of commodities.
But Goldman says the market's mounting concern over a slowdown in global growth and rising U.S. interest rates are weighing on sentiment around commodities. Goldman notes that record-setting long positions in oil — or bets that crude prices will keep rising — have moderated since the commodity crossed $73 a barrel.
Goldman thinks the market's fears are largely unfounded, saying "Growth concerns will likely prove temporary" and "realized demand remains robust."
VIDEO2:3702:37Helima Croft talks about rising energy pricesWorldwide Exchange
Brent crude briefly topped $80 a barrel on Thursday, approaching Goldman's target of $82.50. Falling output in Venezuela and Angola, the return of U.S. sanctions on Iran and bottlenecks in America's premier shale oil region threaten to leave a finely balanced market undersupplied by about 1 million barrels a day, Goldman says.
It also stresses that physical markets — the buyers who actually take delivery of commodities to meet real-world demand — tend to ignore growth concerns and rising rates. They also tend to shrug off a strengthening U.S. dollar, which makes commodities priced in the greenback more expensive to holders of other currencies.
In other words, the world doesn't stop consuming things like corn, copper and crude just because of headwinds that might sideline financial traders, who swap derivatives to take advantage of rising or falling prices.
The bank also notes that the 14-member oil producer group OPEC is currently limiting its output — and it has historically failed to restore production fast enough to meet demand. That means OPEC's current deal with Russia and other producers to keep 1.8 million barrels a day off the market is likely to cause at least a short-term undersupply of oil.
"OPEC has never been able to catch late-cycle demand growth to replenish inventories before a recession occurs," Currie says.
Currie compares the current environment to 2000. Then, OPEC upped production by 3 million barrels a day in the first nine months of the year, after cutting supply to contend with the fallout of the late-90s Asian financial crisis.
VIDEO4:5204:52Oil prices could rise to $85 a barrel by July: Dan YerginSquawk Box
Then as now, growth in developed markets was coming to an end while emerging market growth was ramping up. Rising rates were creating inflationary pressure, a technology boom was underway and the U.S. dollar was strengthening. In the oil market, U.S. sanctions were limiting output from a major OPEC member, crude stockpiles were moderate and oil prices were lower for delivery in the future.
Despite OPEC's exit from production cuts, demand for oil outstripped supply, and the United States had to tap strategic oil reserves to tamp down high gasoline prices. Consequently, Goldman's Petroleum Index rose 51 percent that year.
Today, Goldman sees several other factors boosting oil prices.
Growth in dollar credit will help emerging market oil importers contend with higher crude prices. Those prices will probably remain at least in the $60-$70 per barrel range, creating demand for crude futures among financial traders looking for easy gains through the so-called carry trade. Lower stockpiles will only enforce the oil market's backwardation — where today's prices are higher than future prices — which in turn encourages the carry trade.
Investments in long-lasting oil wells are also too low to meet future demand because U.S. drillers are focusing on quickly depleting shale fields, Goldman says. That's another callback to 2000, when the tech boom sucked capital away from the old industrial economy, creating shortages in key areas.
"While the similarities are striking, we are still hesitant to expect similar returns in 2018, but they do serve to show why being long commodities into a growth slowdown makes a lot of sense," Currie said.
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186779f9475e9218b18003406a33707b | https://www.cnbc.com/2018/05/18/government-leak-turned-three-way-war-between-comey-mccabe-and-trump.html | How a typical government leak turned into a three-way war between Comey, McCabe and Trump | How a typical government leak turned into a three-way war between Comey, McCabe and Trump
Andrew McCabe, left, and James Comey.Getty Images
One of them has to be lying.
That conclusion is inescapable if you closely examine the sworn testimony of two erstwhile FBI allies, James Comey and Andrew McCabe, about the leaking episode that led to McCabe's firing in March. After all, two diametrically opposed accounts can't both be correct.
President Donald Trump has seized upon the situation — laid bare in a report from the Justice Department's inspector general — to assail both men, long among his favored targets for reasons having nothing to do with their veracity. "He LIED! LIED! LIED!" Trump wrote, in a veritable presidential tweet-gasm, hours after the McCabe report's release. "McCabe was totally controlled by Comey - McCabe is Comey!! No collusion, all made up by this den of thieves and lowlifes!"
More from ProPublica: You're entitled to government transparency Police are mislabeling anti-LGBTQ and other crimes as anti-heterosexual Electionland
This is much more than a venomous 21st century personal duel — tweet versus tweet at 10 paces. The credibility of Comey and McCabe is crucial, giving Trump every incentive to tar them. The former has offered withering accounts of his interactions with the president. And given what the two men observed both before and after Trump sacked Comey, both could be called on for key testimony in a potential obstruction of justice charge against the president.
The truth is that, in this case, Trump is partially right: One or both of the FBI's former top officials is almost certainly lying. The irony is that the entire episode is at complete odds with Trump's long-running claim about a "Deep State" FBI cabal that's out to get him. The leak at issue, in fact, brought election-eve attention to a second investigation of the Clintons, news that helped Trump's campaign.
It's yet another improbable turn of events.
Comey and McCabe were both long thought to embody the square-jawed, gray-suited ideal of the honest G-man. And by all accounts, they were close colleagues. Comey elevated McCabe, over more traditional candidates, to be his deputy; McCabe then served as acting FBI director for three months after Comey's dismissal.
But they diverged dramatically in their testimony for the IG's investigation, which focused on a leak that McCabe orchestrated to the The Wall Street Journal about an FBI probe into the Clinton Foundation. In his damning 35-page report, the IG concluded that McCabe made an "improper media disclosure" and demonstrated "lack of candor," repeatedly lying about it under oath.
McCabe's punishment was swift: He was fired on March 16, just two days before he would have qualified for retirement, after 21 years at the FBI.
Comey's testimony, which the IG concluded was backed by the "overwhelming weight" of circumstantial evidence, was instrumental to the report's conclusions. In Comey's telling, he was ignorant of the original leak, and then misled about it. When he and McCabe discussed The Wall Street Journal article shortly after its publication nine days before the election, according to Comey's sworn testimony to the IG, McCabe professed bewilderment about the leak's source. Testified Comey: "I have a strong impression he conveyed to me, 'It wasn't me, boss.' And I don't think that was by saying those words. I think it was most likely by saying, 'I don't know how this shit gets in the media, or why would people talk about this kind of thing?' — words that I would fairly take as: 'I, Andy, didn't do it.'"
Comey has always portrayed himself as a model of probity. In public appearances and in his recent memoir, "A Higher Loyalty: Truth, Lies, and Leadership," he stresses the importance of "a fundamental commitment to the truth — especially in our public institutions and those who lead them." In his book's 312 pages, the word "truth" appears 73 times in various forms. There are 98 references to "lying" or "lies."
In interviews during the recent media blitz for his book, Comey cast the McCabe episode as reinforcing the importance of truth-telling and accountability. "Sometimes even good people do things they shouldn't do," Comey told CNN. "It's not acceptable in the FBI or the Justice Department for people to lack candor." (Comey declined a ProPublica request to discuss McCabe, emailing back that the matter is "painful and complicated, and I don't want to step into it." McCabe also declined to be interviewed.)
For his part, McCabe testified that he told Comey about the leak at the time, insisting that it's his old boss who has it wrong. McCabe's account is presented in detail in the IG's report, as well as in a series of press statements from McCabe and his lawyer, former DOJ inspector general Michael Bromwich.
Bromwich asserts the IG report falsely "paints Director Comey as a white knight carefully guarding FBI information." In Bromwich's view, Comey had "every incentive to distance himself" from the controversial leak. After all, he noted, Comey himself was being investigated by the IG for allegedly improper media disclosures. That report, focused on Comey's handling of the Clinton email case, is expected in a few weeks. It will likely spark a whole new round of scrutiny about leaking.
Meanwhile the president has reveled in the spectacle of two favorite targets turning on one another. Six days after the McCabe report came out, he tweeted: "James Comey just threw Andrew McCabe 'under the bus.' Inspector General's report on McCabe is a disaster for both of them! Getting a little (lot) of their own medicine?"
The easy part is concluding that someone was untruthful in this instance. The much harder point is trying to determine which person it was — and what to make of it.
Last year, I spent five months on assignment for ProPublica examining the FBI's handling of the Clinton email investigation — an exquisitely fraught case with career implications for all involved. The assignment offered some perspective into the trafficking of sensitive information in Washington, D.C. — and how the curious facts of the McCabe affair are distorting a series of events that in other, less politically raucous, times might have been unremarkable. And it's all been intensified by a drastic change in the political environment.
If you want to see the embodiment of the popular view of a government leak, Steven Spielberg's movie "The Post" provides a good example. It depicts The Washington Post's Katharine Graham and Ben Bradlee (played by Meryl Streep and Tom Hanks) as they wrestle with whether to publish secret documents known as the Pentagon Papers. Those papers were furtively photocopied and then handed over to journalists by civilian military contractor Daniel Ellsberg. Depending on your political perspective, Ellsberg was either a conscience-driven whistleblower exposing government deceit about the Vietnam War, or a traitor harming the interests of the U.S. government. But either way, the portrayal embodies the most traditional definition of leaking: an individual bringing to light information that those in power don't want revealed.
But there's a whole second category of leaks — that get less attention but are surely far more prevalent. (Nobody keeps statistics on these things.) These leaks occur when public officials disclose something, often with official approval, to advance the interests of their institutions and themselves.
The FBI is no exception to this practice. Outside of congressional hearings or public appearances, officials there are loath to be quoted in the press by name. "Background" briefings — where officials express opinions or describe events while shielded by agreements that they will be identified obliquely as, say, "sources familiar with the matter" — have long been common.
There are undoubtedly semantics involved. A government official trying, in his view, to inform the public, likely doesn't view himself as "leaking." Sure enough, in his book, Comey wrote that he told Trump that he "didn't do sneaky things" and he didn't leak. Similarly, at a Senate Judiciary Committee hearing last May, six days before Comey's firing, Iowa Sen. Charles Grassley asked him if he'd "ever been an anonymous source" or, in a separate question, if he had "ever authorized someone else at the FBI to be an anonymous source" for news reports about the investigations into Clinton's emails or Trump's Russia ties.
"Never," Comey replied to the first question. "No," was his response to the second.
My reporting about the FBI doesn't tie Comey to any disclosures directly provided or overtly "authorized." But it's fair to say there was a great deal written about the agency and its work — by The New York Times, The Washington Post, and the Journal, as well as ProPublica — that accurately recounted specific actions, meetings and thinking at the highest levels within the FBI. Many of those articles quoted "sources familiar with the matter." Comey's book confirmed many of these events in strikingly similar detail.
Comey has long been one of the most media-savvy officials in Washington. Days after his firing, as he later acknowledged in congressional testimony and in his book, Comey provided a close friend, Columbia University law professor Daniel Richman, with one of the memos he prepared memorializing his meetings with the president, and arranged for Richman to anonymously share its "substance" with a New York Times reporter, in hope of forcing the appointment of a special prosecutor.
Which brings us to Donald Trump. As a New York developer, he was widely reported to be an inveterate leaker, shamelessly inflating his reputation (as a businessman and lady's man) with a multi-decade stream of anonymously sourced tidbits planted in Gotham's tabloids. As a presidential candidate, he reveled in the hacked Clinton email revelations served up on Wikileaks.
In his actions as president, Trump has been less than consistent on the issue of leaking. For example, he revealed highly classified intelligence to Russia's ambassador and foreign minister during a May 2017 meeting in the Oval Office. And last month, Trump pardoned one time vice presidential chief of staff Scooter Libby, who was convicted of perjury and obstruction of justice for concealing the fact that he had leaked the identity of a CIA officer.
That hasn't stopped Trump (like many a president before him) from expressing outrage about leaking. In his case, he has conflated it with lying and threatening the nation's security. He has labored mightily to brand some of his critics with a scarlet L, as disseminators of America's secrets to "the enemy of the people" — the news media.
Trump called California Rep. Adam Schiff, the Democrat bird-dogging the Russia investigation, "the leakin' monster of no control." Former Director of National Intelligence James Clapper; former CIA Director John Brennan; Mark Warner, the ranking Democrat on the Senate Intelligence Committee — all were "liars and leakers." Comey, Trump declared over and over, was "a proven LEAKER & LIAR," who "gave up Classified Information (jail)." More recently, he reacted to embarrassing disclosures emanating from his own White House by calling the offenders "traitors and cowards."
Trump began targeting Comey and McCabe while a candidate in 2016, for reasons that had everything to do with politics — and nothing to do with leaks or lies.
Candidate Trump's opinion of the FBI director was transactional, ping-ponging with his view of whether Comey's latest action benefited him. He bashed Comey for his July 2016 announcement that there was no basis for charging Hillary Clinton in the FBI's investigation of her private email server; praised Comey in late October for announcing that he was reopening the case, after agents discovered new Clinton emails on Anthony Weiner's laptop; and attacked Comey again, days later, when he announced that examination of the new messages hadn't changed anything.
Trump then fired Comey less than four months after taking office, explaining in an NBC interview at the time that he'd been frustrated by the director's refusal to shut down the Russia investigation.
Trump's enmity toward McCabe has a partisan origin, stemming from reporting in an Oct. 23, 2016, Wall Street Journal story: During a failed bid for a Virginia state senate seat the year before, McCabe's wife Jill, running as a Democrat, had taken $467,500 in contributions from the political action committee of Gov. Terry McAuliffe, a close Clinton ally.
According to an FBI statement provided to the Journal, McCabe, who was a Republican, had played "no role" in the Virginia campaign, conferred with FBI ethics overseers about the matter, and had no responsibility for the Clinton email investigation until February 2016 — months after his wife's defeat — when Comey promoted him to deputy director.
No matter. Then-candidate Trump immediately tweeted out the story, telling campaign rallies that the situation was "absolutely disgraceful," sure proof that the FBI's email probe was "rigged."
Thus was the stage set for the "improper media disclosure" that led to McCabe's sacking.
As leaks go, what McCabe would provide was underwhelming. It didn't involve classified information. It didn't reveal much of a secret. And it was overshadowed by much bigger news.
This was a classic Washington leak: a calculated act of reputational enhancement (one that, not incidentally, also took a potshot at another agency). And how it occurred was telling. This was no secret conversation in a garage at midnight.
Instead, as laid out in the inspector general's report, it originated with a request by a reporter to the person officially designated by the FBI to handle such queries. Three senior officials then conferred before any information was released.
On Oct. 24, 2016, just two weeks before the presidential election, Devlin Barrett, who covered law enforcement for the Wall Street Journal, emailed FBI public affairs chief Michael Kortan, the agency's longtime official spokesman. Barrett had written the article that explored whether Jill McCabe's political ties had influenced the email probe — the article that Trump had seized upon.
Now, Barrett was pursuing a related story: He'd been told the FBI's deputy director had sought to chill a second Clinton probe, this one involving donations to the Clinton Foundation.
Kortan conferred with McCabe, who authorized the public affairs chief and Lisa Page, a key FBI attorney assigned to McCabe's office, to speak with Barrett on condition that they not be identified as the source of the information. (Page, then in the midst of an extra-marital affair with Pete Strzok, the FBI agent who had led the Clinton email probe, would later become a target of criticism after investigators discovered their text exchanges, which included remarks critical of Trump.)
During an initial call on Oct. 27, Barrett told the FBI's Kortan and Page that his sources were adamant that McCabe had issued orders to "stand down" on the Clinton Foundation investigation. Page quickly briefed McCabe, who later told investigators he considered this narrative "incredibly damaging." McCabe instructed Page to provide the reporter an anecdote designed to counter the "stand down" claim.
At the time, the FBI's investigation into the Clinton charity had been lingering for more than a year. Its existence was widely known in Washington, in part, top FBI officials suspected, because of whispers from Clinton-hating agents in the bureau's New York field office. It had been written about widely in the press.
But it was still officially secret, even as the rules for confirming investigations suddenly seemed less certain. A year earlier, Comey had publicly confirmed that the FBI was investigating Clinton's use of a private email server. In his book, Comey explains that the email probe was something "the whole world knew anyway"; making "no comment" about it seemed "increasingly silly." He cites DOJ policies allowing such disclosure regarding matters of "extraordinary public interest" or where investigative activity had already made it obvious. (In that case, Comey wrote, Attorney General Loretta Lynch had agreed with his decision.)
But when, at a hearing in July 2016, a Republican congressman asked Comey if the FBI was looking into the Clinton Foundation, he refused to confirm the probe. Comey testified that it was standard FBI practice to decline comment on "the existence or non-existence" of ongoing investigations.
Nonetheless, on Oct. 27, 2016, McCabe authorized Page and Kortan to furtively confirm to a reporter what Comey publicly would not.
Late that afternoon, speaking from Kortan's office at FBI headquarters, they told the Wall Street Journal's Barrett about a phone conversation McCabe had with Matt Axelrod, a top lieutenant to Deputy Attorney General Sally Yates, two months earlier. As the FBI officials related it, Axelrod was "very pissed off" that New York agents were still openly pursuing the Clinton Foundation probe. (Justice Department policy strongly discourages taking any overt investigative steps involving a political candidate close to an election.)
Page and Kortan told the Wall Street Journal reporter that McCabe had defended the investigation into the Clinton Foundation, saying: "Are you telling me that I need to shut down a validly predicated investigation?" That prompted Axelrod, "after a pause," to say, "Of course not," according to this account. (Axelrod, now in private practice, declined to discuss the matter.)
After the conversation, Page reported back to McCabe (who was out of town), texting: "We're done. He's going to look at his story again and will circle back with him in the morning."
Meanwhile, the Justice Department appeared to be deploying its own leaks to jab at the FBI. On Oct. 29, The Washington Post published an anonymously sourced story, headlined: "Justice Officials Warned FBI That Comey's Decision to Update Congress Was Not Consistent with Department Policy."
Strzok texted Page about the Post article the next day, concluding that Axelrod was the source. "Yeah. I saw it," Page replied. "Makes me feel WAY less bad about throwing him under the bus in the forthcoming CF [Clinton Foundation] article."
The Journal story was posted a short time later. The entire exchange that McCabe had leaked — including the dramatic "pause" in the conversation — appeared, attributed to "a person familiar with the probes," "one person close to Mr. McCabe," and "people familiar with the conversation."
But the material was buried inside a story that focused on new details about a far bigger revelation two days earlier: Comey's election-jarring announcement that he was reopening the email probe. McCabe's leak seemed trivial at the time.
A lot of things changed over the ensuing six months. Trump was elected president, for starters, and his campaign was under investigation. Trump began castigating the FBI on a regular basis. An agency that had historically been subject to less criticism and scrutiny than other agencies was suddenly being bashed by the president, its motivations and actions questioned.
So when Trump fired Comey, on May 9, 2017, McCabe found himself acting director of the FBI — facing the same kind of presidential pressure and attention that Comey had endured. Although McCabe didn't know it, a conversation he'd had earlier that day would light a fuse on his own FBI career.
Two agents from the FBI's inspection division, expanding an existing investigation of media leaks, had decided to interview the deputy director about the Oct. 30 Wall Street Journal story because it appeared to show someone had improperly revealed McCabe's private conversation with a Justice Department official.
This would be the first in a series of interviews with investigators in which McCabe, according to the inspector general, repeatedly lied and changed his story.
According to the IG report, McCabe told the agents on May 9 that he had "no idea" how the account of his conversation with the DOJ official got out. Three days later, they emailed him a draft statement of what he'd told them, asking him to sign and return it. The statement read in part: "I do not know the identity of the source of the information contained in the article. ... I gave no one authority to share any information relative to my interaction with the DOJ executive with any member of the media."
McCabe never signed the statement.
On July 28, investigators from the inspector general's office, in the midst of their separate inquiry into the Clinton email case, decided to interview McCabe after reviewing Page's text messages and discovering references to her meeting with the Journal reporter.
At this point, McCabe had had roughly seven weeks to refresh his recollection. But he stuck to his initial position. Asked on tape and under oath if Page had been authorized to talk to a reporter, McCabe replied, according to the IG report: "Not that I'm aware of." Questioned about texts that suggested otherwise, McCabe said: "I was not even in town during those days. So I can't tell you where she was or what she was doing."
Four days later, on Aug. 1, McCabe changed his stance. He called an assistant inspector general and said he "may" have authorized Page to speak to Barrett, after all.
On Aug. 18, in yet another conversation with investigators, McCabe admitted he'd "misspoke." He now "took ownership" of the leak.
That admission led the investigators to refer the matter to Michael Horowitz, the inspector general of the Justice Department, who launched his own probe on Aug. 31, 2017. (As it happens, McCabe's lawyer, Bromwich, had previously praised Horowitz, calling him "an experienced and highly regarded law enforcement professional" in an op-ed for The Washington Post in early 2017.)
By Nov. 29, when he was questioned again by investigators for the IG, McCabe seemed to be trying to offload some blame on his former boss. McCabe, now accompanied by a lawyer, detailed his claim that he'd told Comey he had disclosed the Axelrod conversation when they spoke on the day after the Journal story appeared. The director "did not react negatively," McCabe testified — instead telling his deputy it was "good" that he had made clear the FBI wouldn't buckle to political pressure.
McCabe also told the IG he didn't view what he'd done as revealing the existence of an investigation, explaining, "There really wasn't any discussion of the case, of the merits of the case, the targets and subjects of the case, so I did not see it as a disclosure about the Clinton Foundation case."
The inspector general's report served up a heap of evidence against McCabe from multiple sources. But it was Comey who served as perhaps the most damning witness. The report detailed his starkly conflicting account of their conversation about the Journal story.
In his testimony to the IG, Comey said McCabe had "definitely" not told him he was behind the leak. "…[J]ust to make sure there's no fuzz on it," he testified, "I did not authorize this. I would not have authorized it." The IG spelled out multiple reasons why Comey would not have viewed his deputy's disclosure with equanimity.
The first was a meeting with his executive team on Oct. 31, 2016, convened shortly before he discussed the Journal story with McCabe. There, Comey expressed dismay about all the leaks emanating from the bureau. According to notes Page took at the meeting, later cited in the IG report, Comey cited a "need to figure out how to get our folks to understand why leaks hurt our organization."
At the time, Comey was already being skewered for having revealed his decision to reopen the Clinton email investigation. He said he would never support confirming any investigation through a leak and noted his earlier refusal to disclose the Clinton Foundation probe. Discussing the conversation with Axelrod, he noted, was also sure to harm the FBI's already troubled relations with the Justice Department.
As one of the FBI's two top officials, McCabe had authority to share information with the media, a point he offered in his defense — but only after denying, then admitting, responsibility for the leak. The inspector general rejected his claim that this disclosure met the Justice Department's "public interest" standard. Instead, the report found, it was "an attempt to make himself look good by making senior [DOJ] leadership … look bad." McCabe, the report concluded, was primarily motivated by his desire to avoid "another personally damaging story."
To put it another way: It was a typical government leak. But with the FBI under critical examination in Trump-era Washington, it looked much more suspicious than it might have in the past, especially given McCabe's shifting story.
In late February, the IG privately sent his report to the FBI's Office of Professional Responsibility, which recommended McCabe's dismissal. Attorney General Jeff Sessions fired him on March 16.
Trump quickly tweeted: "Andrew McCabe FIRED, a great day for the hard working men and women of the FBI — A great day for Democracy. Sanctimonious James Comey was his boss and made McCabe look like a choirboy. He knew all about the lies and corruption going on at the highest levels of the FBI!"
In a series of media statements after his dismissal, McCabe, whose case has now been referred for possible criminal prosecution, blamed political pressure from Trump for his firing and made clear his determination to fight. He contended he answered investigators' questions "as completely and accurately as I could" during a chaotic time, and made efforts to correct his answers when he realized they were "not fully accurate or may have been misunderstood."
McCabe presented a detailed rebuttal that was included and discussed — but ultimately found unpersuasive — in the report. And his defense team told ProPublica they also have reviewed previously undisclosed emails proving that McCabe informed Comey that he was in contact with the Journal, which the IG chose to leave out of the report. They also assert that transcripts of Comey's interviews show he was uncertain in his recollections of what really happened. They say they are barred from providing details of these purportedly exonerating documents because they remain subject to a government non-disclosure agreement.
McCabe's team provided ProPublica with a copy of the NDA, which granted his lawyers access to "certain FBI-related information" on the condition that they not release anything "derived from or relating to FBI files" without "prior written authorization of the FBI." McCabe spokeswoman Melissa Schwartz said Bromwich has sought, but not received, release from the non-disclosure agreement. (A representative of the IG's office declined comment on the issue.)
It's certainly plausible to imagine that in an organization as hierarchical as the FBI — with its chief press officer coordinating the interaction with a major publication — Comey would normally have been made aware of McCabe's actions. (Kortan, who retired in February as assistant director for public affairs after surviving as the FBI's media chief for 18 years, declined to discuss the matter; the IG's report makes no mention of any testimony from him on the matter.)
The inspector general's report makes clear that he considered Comey's testimony more credible than McCabe's. But the same inspector general is about to release a second report, this one focused, among other matters, on Comey's actions and public disclosures in the Clinton email case. For all of Comey's professions to Trump that he wouldn't do anything "sneaky," the episode where he leaked one of his memos through a surrogate — while not involving any classified information (contrary to what Trump claims) — appears to fit that definition. And, as noted, descriptions in his book conspicuously match the views of "sources familiar with the matter" who were cited in past news articles.
Many legal experts — and deputy attorney general Rod Rosenstein — have already concluded that Comey's actions during the email investigation violated longstanding Justice Department policy. In the McCabe report, the IG embraced his view of events. In the report that is forthcoming, he may not fare as well.
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e131fe6960adcec346eeca36af1e418d | https://www.cnbc.com/2018/05/18/heres-why-one-scorched-restaurant-stock-may-be-about-to-sizzle.html | Here’s why one scorched restaurant stock may be about to sizzle | Here’s why one scorched restaurant stock may be about to sizzle
VIDEO1:1201:12One trader betting on a big rebound for this restaurant stockOptions Action
Darden Restaurants has taken a tumble this year, but one trader is betting the stock is about to heat up.
Shares of the restaurant group, which includes popular chains like Olive Garden and The Capital Grille, have plunged nearly 12 percent since January. However, "Options Action" trader Mike Khouw says the Florida-based company could be gearing up for a resurgence.
Call volume for Darden on Thursday was 15 times average. Khouw said that's unusually bullish activity for stocks in the casual dining group.
"We saw it in a couple of restaurant spaces," Khouw said Thursday on CNBC's "Fast Money." "These are names [that] haven't been doing particularly well, and not all of the news has been great."
Despite the recent surge in gasoline prices, consumer spending has still managed to tick higher, but many restaurant stocks have been sitting out of the rally. Shares of Darden Restaurants are now down nearly 15 percent from their 52-week high of $99.31 in January.
Darden's slide comes as Chipotle and Shake Shack soar. Shares of Chipotle surging 49 percent this year, while Shake Shack has boasted gains of nearly 35 percent. Khouw said the tables could be about to turn for the beaten-down dining space. On Thursday, Khouw highlighted a trade of over 2,000 of the July 85 calls being bought for $3.50 per contract.
"So [this] buyer [is] obviously believing the stock could make it above $85 by the $3.50 they spent," Khouw said. This bullish bet implies shares of Darden Restaurants will hit $88.50 by July.
Shares of Darden are still up more than 35 percent since 2015, with an average FactSet analyst rating of overweight and a price target of $100.68.
Darden Restaurants is expected to report fourth-quarter earnings on June 26. Shares were trading lower Friday afternoon, above $85.
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11ab3f704e668364030cdd83cc160716 | https://www.cnbc.com/2018/05/18/high-speed-rail-project-to-test-singapore-malaysia-ties.html | How Malaysia's new government could test ties with Singapore | How Malaysia's new government could test ties with Singapore
A view from Singapore of the border crossing into the Malaysian southern city of Johor Bahru.ROSLAN RAHMAN/AFP/Getty Images
Singapore and Malaysia may find their relationship under pressure if the latter's new government withdraws from a rail project that's become emblematic of improved bilateral ties.
Uncertainty clouds the future of a 2016 deal to construct a high-speed rail network between Kuala Lumpur and Singapore after Malaysian Prime Minister Mahathir Mohamad said this week that all foreign infrastructure programs will be reviewed. His administration will be assessing existing initiatives on feasibility of as well as the sum of borrowed money.
Scrapping the 350km rail network, which is expected to slash travel time between the two cities to 90 minutes from a four to five-hour car journey, could reintroduce tensions into Malaysia's interactions with its wealthy, next-door neighbor.
For decades, relations between the two were uneasy after Singapore separated from Malaysia to become an independent nation in 1965. The two now enjoy a warm alliance — despite occasional hiccups over issues such as territory and water — that the Kuala Lumpur-Singapore high speed rail project is meant to represent.
"The rail is a very important project symbolizing the mending of ties between Singapore and Malaysia in the 2010s," said Chan Xin Ying, a Malaysia-focused research analyst at Nanyang Technological University.
VIDEO3:0803:08Malaysia's new coalition government will pursue 'sensible' economic policiesSquawk Box Asia
Mahathir, a 92 year-old veteran politician who swept to power in last week's election, has previously opposed the rail link, referring to several mega-projects sanctioned by his predecessor Najib Razak — particularly Chinese investments — as "wasteful" and "unnecessary."
"Diplomatic ties with Singapore may not be as warm as they were under Najib but will only become strained if Mahathir cancels the rail link," Peter Mumford, Asia director at political consultancy Eurasia Group wrote in a Wednesday note. "It would be surprising, but not unimaginable, if [Mahathir] pulls out," Mumford continued.
Shares of YTL, a conglomerate awarded part of the contract to build the railway, fell more than 8 percent Monday when the Malaysian stock market resumed trade post-election.
For now, it's still too early to make any conclusions.
"Any decisions on economic projects and foreign relations, including the high-speed railway, will not be the PM's decision alone," according to Chan. Mahathir himself has stated that if the project is deemed feasible, it could even extend up to the Malaysia–Thailand border, she continued.
VIDEO2:3002:30Malaysia's 'next challenge' is appointing its full cabinet: ExpertStreet Signs Asia
According to BMI Research, the Kuala Lumpur-Singapore train is politically popular and economically sound so it's likely to move forward.
"Its business case is supported by the fact that Singapore to Kuala Lumpur is the world's busiest international air route," the analysis firm said in a report. "Contracts and tendering processes are likely to be reviewed, however, given that the Malaysian implementing agency MyHSR was directly under the control of former Prime Minister Najib Razak," it said.
Aside from the rail link, Mahathir's electoral victory is seen as a positive for Singapore.
"Singapore will likely welcome a stronger Malaysian voice in ASEAN pushing for regional integration, and delays or cancellations of China-backed rail and port investments in Malaysia would reduce the risk of a competitive threat to its leading status as a logistics hub," Mumford stated.
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1c43ba4a0c6dff76f6e6284bc20a1427 | https://www.cnbc.com/2018/05/18/major-food-and-drink-producer-goes-big-on-using-recycled-plastic.html | Major food and drink producer Princes goes big on using recycled plastic in its bottles | Major food and drink producer Princes goes big on using recycled plastic in its bottles
The bottles used for major food and drink group Princes' soft drinks and oils ranges are now being made with more than 50 percent recycled plastic, the business said Friday.
By the end of September, all branded and own-label bottles are expected to contain 51 percent recycled polyethylene terephthalate (RPET), it said. Princes claims to produce around 7 percent of all plastic bottles used in the U.K. each year. The issue of plastic waste is a serious one. Europeans produce 25 million tons of plastic waste per year, according to the European Commission. Less than 30 percent of this is collected for recycling. "We want to increase the recycled content of all the plastic we use and have been working for some time to implement 51 percent RPET, as it's by far our biggest area of plastic usage," David McDiarmid, Princes' corporate relations director, said in a statement. McDiarmid described the development as a significant step, not only for Princes, but "the wider grocery industry too, as we will reach millions of households through our supply of brands and customer own-brand soft drinks and oils." A number of businesses are looking to tackle the issue of plastic waste and pollution. Earlier this year, Evian, whose parent company is Danone, announced it would produce all its plastic bottles from 100 percent recycled plastic by the year 2025. Elsewhere, U.K. supermarket Iceland, which specializes in frozen food, has made a commitment to eliminate plastic packaging from its own-brand products by the end of 2023.
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ba5e32184e9163438dab2ba2f1cacaa2 | https://www.cnbc.com/2018/05/18/makeup-entrepreneur-cries-talking-about-her-business-on-shark-tank.html | According to "Shark Tank" hopeful Mikki Bey, the CEO of Mikki Bey Eyelash Extensions, "Your next best investment is one wink away." She helped her long list of clients lengthen their eyelashes when falsies just weren't enough.
Before opening her successful lash studio in Los Angeles, Bey made a name for herself as a celebrity makeup artist to stars like Missy Elliott, Jason Derulo, and Colbie Caillat. However, the dream of expanding into a full luxury brand is what landed Bey on Shark Tank in 2015.
During her pitch, she applied a set of lashes on Mark Cuban, trying to convince the Sharks to give her $300,000 in exchange for 20 percent of her business.
Throughout the pitch, Bey's love for her company is apparent, and she was even brought to tears when talking to the Sharks about it.
She didn't land a deal, yet the entrepreneur said she wouldn't have changed a thing she did on the show. She insisted that she learned many lessons in the process.
"It was a dream come true to meet the Sharks," said Bey, "especially Mark Cuban, who I admire tremendously."
Bey owes a lot to her early "Shark Tank" success. "I can't put into words the totality of the impact Shark Tank had on my business. It solidified me as a major player in the beauty industry and as an expert. I was already booked and busy before the show aired but after it aired it was pandemonium!"
And while Bey's salon is no longer in business, she continues to benefit from her chance to pitch to the panel. "My brand is still recognized and highly regarded in the beauty industry due to the notoriety I achieved from Shark Tank."
Even though Bey has moved on in her career, she's hoping it isn't the last you hear from her. She plans to open a new salon very soon saying, "I will always have entrepreneurial endeavors. Stay tuned!"
Watch Bey try to catch the eye of Shark Tank's all-star panel Sunday at 9P ET on CNBC.
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f0edc50afec9ccf7078dac0408447065 | https://www.cnbc.com/2018/05/18/marvel-comics-stan-lee-1-billion-lawsuit-preposterous-says-chinese-firm.html | Marvel Comics legend Stan Lee’s $1 billion lawsuit is ‘preposterous,’ Chinese firm says | Marvel Comics legend Stan Lee’s $1 billion lawsuit is ‘preposterous,’ Chinese firm says
Stan Lee in his office in Beverly Hills, California.Getty images | Washington Post
A Chinese company has said it is "preposterous" that Stan Lee, the former editor-in-chief at Marvel Comics, did not know he was signing over his name, image and likeness to it on an exclusive basis.
Lee, who co-created Spider-Man, the Hulk and the X-Men, filed a $1 billion suit against Pow Entertainment, a company he co-founded in 2001, on Tuesday. He alleges that his identity and work was taken fraudulently so that Pow could then be sold to the Chinese firm Camsing International Holdings.
Lee claims that the co-founders of Pow, Shane Duffy and Gill Champion, used deception to make him sign-over his name, image and likeness on a wholly exclusive basis.
A promotion image from Marvel's 2018 hit "The Black Panther".Source: Marvel
In the lawsuit filed in state Superior Court in Los Angeles, the 95-year-old comic book legend said his signature was either forged, imposed from another document or induced by a bait-and-switch tactic.
In a response Friday, Camsing International Holdings issued a statement to CNBC through a firm run by Los Angeles-based publicity consultant Howard Bragman.
In it, Camsing said it had reviewed the complaint, adding that "the notion that Mr Lee did not knowingly grant Pow exclusive rights to his creative works or his identity is so preposterous that we have to wonder whether Mr. Lee is personally behind this lawsuit."
VIDEO3:2403:24Stan Lee: Special effects revitalized comicsClosing Bell
The statement added that the complaint, although published, had not yet been properly served but that when it was, Camsing would "look forward to presenting its evidence in court."
In April, Lee issued a separate suit against former business partner Jerardo Olivarez claiming that he had transferred $4.6 million out of his bank account without authorization. He also claimed Olivarez was carrying out bogus schemes to enrich himself. Olivarez could not be located for comment.
Pow Entertainment did not immediately respond to a CNBC request for comment from Duffy and Champion.
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5cf19d505ca728deecce9a8637eb4894 | https://www.cnbc.com/2018/05/18/migraine-medicine-could-be-worth-1-billion-to-2-billion-in-5-years.html | Migraine prevention drug could be worth $1 billion to $2 billion over next five years: Wall Street analyst | Migraine prevention drug could be worth $1 billion to $2 billion over next five years: Wall Street analyst
VIDEO3:0603:06Amgen's migraine treatment focuses on huge un-met need, says analystPower Lunch
The anti-migraine drug Aimovig from Amgen and Novartis could become a $1 billion to $2 billion business over the next five years, said a Wall Street analyst.
"That's a 10 percent move to Amgen's revenue," Michael Yee, managing director at Jefferies, an investment banking firm, told CNBC.
"The key is that, I think this is a huge unmet need," Yee said Friday on "Power Lunch."
Aimovig is a monthly preventative migraine treatment administered through a pen, similar to an insulin pen. The treatment, the first of its kind, is expected to have a potential user base of 10 million people in the U.S. alone.
On Thursday, the FDA approved the drug.
"This is the start of an important product cycle for Amgen," Yee said.
The treatment, priced at $575 a month or $6,900 a year, is still out of reach for many. But Yee said the price was better than expected. Some analysts had anticipated the drug would be priced as high as $10,000 a year.
"There's been this investor fear and Wall Street fear that these [drug companies] want these high prices and access is a problem and then nobody wins," the analyst said.
"Because Amgen priced low, opening up access, I think that's going to be a big key test for how big these drugs could be," Yee said.
His firm has a buy rating on the stock and a price target of $200. Amgen shares closed Friday up nearly 1 percent to $176.30.
For now, Amgen, in partnership with Novartis, has cornered the market on migraine treatments. But Yee said other companies, such as Eli Lilly, Teva and Alder BioPharmaceuticals, have medicines in the same class currently in development. And with more competition, the price will likely go down, he said.
"Multiple players in this market could make the market quite big," Yee said.
Disclaimer
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c63e841f0d686797db2a704460b15ed8 | https://www.cnbc.com/2018/05/18/more-pain-for-companies-that-make-baby-products-as-us-births-hit-low.html | US birth rates hit record low and diaper, baby bottle companies are feeling the pinch | US birth rates hit record low and diaper, baby bottle companies are feeling the pinch
VIDEO1:1401:14US births hit lowest number since 1987Squawk Box
For the second year in a row, the U.S. fertility rate hit a record low, extending a decline in the number of American births that started in 2008.
The rate fell to 60.2 births per 1,000 women of childbearing age in 2017, down 3 percent from 2016, according to the Centers for Disease Control and Prevention's National Center for Health Statistics.
As would-be parents push back parenthood, companies that provide baby products are feeling the pinch.
Kimberly-Clark, the maker of Huggies diapers, has been vocal about the hit it's taking from declining birth rates.
In January, the company announced it would cut about 13 percent of its workforce globally, or at least 5,000 jobs, in a bid to reduce costs as sales fell.
"I'd say, certainly in 2017 we had some factors like the birthrate in the U.S. and Korea being more negative than expected, that you can't encourage moms to use more diapers in a developed market where the babies aren't being born in those markets," CEO Thomas Falk said in an earnings call in January.
Pampers-maker Procter & Gamble and Edgewell Personal Care, the maker of Playtex baby bottles, have also reported sales declines in their baby businesses this year.
"The declining birth rates sweeping across America are going to have a profound [e]ffect on many businesses — some in the immediate term and others 5 to 10 years out," Jason Dorsey, president of the Center for Generational Kinetics, told CNBC via email. "The reason is that declining birth rates hit the obvious group of businesses first: diaper makers, toy makers, kids meals at restaurants, car seat manufacturers and the like."
With a shrinking market, it becomes even more important to perfect your pitch. Baby care heavyweight Johnson & Johnson's has seen a 20 percent sales decline in its Baby Care unit since 2011 and plans to redesign its Johnson's Baby products to appeal more to modern-day moms.
The new line emphasizes more natural ingredients.
"Perhaps because of our success, we became a bit complacent and did not want to mess with success, for lack of a better expression," Jorge Mesquita, worldwide chairman and executive vice president for J&J's global consumer unit, said in an interview with CNBC's Meg Tirrell recently. "Frankly, we failed to see evolving needs from millennial consumers, millennial moms, and we failed to evolve our model."
The U.S. has experienced birth-rate declines before. The longest period of continuous decline on record happened between 1958 and 1968, according to the CDC.
However, generational changes could exacerbate this decline. Women are postponing marriage in favor of their careers and waiting to have children until later in life, if at all.
"The big question we're exploring at our generational research center is if this is a temporary generational delay or a new normal," Dorsey said. "At this point, our research appears to show this is heavily generational driven by millennials who are now well into their late 30s. We consistently hear millennials tell us that they're delaying having kids until they feel ready —financially and otherwise — yet they also tell us they still intend to have kids."
"What will be telling to us is how Generation Z reaches traditional markers of adulthood, such as having children, and if they swing the pendulum back the other way as they emerge," he said. "They are now up to age 22. This is a trend business leaders need to watch closely whether it impacts them now or will in the future."
VIDEO2:3702:37Johnson & Johnson CEO Alex Gorsky on revamping baby productsSquawk Box
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f500b849c2c3f91a7a124748a492802c | https://www.cnbc.com/2018/05/18/national-australia-bank-ceo-on-bank-advisors-misconduct.html | National Australia Bank CEO: 'As a banker, I am ashamed' | National Australia Bank CEO: 'As a banker, I am ashamed'
VIDEO4:2504:25Bad behavior in banks can be 'really destabilizing': NAB CEOSquawk Box Asia
With the National Australia Bank under fire over allegations of fraud and misconduct by its bankers, its CEO Andrew Thorburn admitted that banks had been prioritizing its company operations over its clients.
"Well I think this has been a drift over time where banks have become so complex, maybe so hierarchical, so focused on compliance, rather than truly understanding the client and doing the right thing," he said.
In an interview with CNBC in Melbourne on Friday, he said: "As a banker, I am ashamed."
A Royal Commission inquiry had exposed the misconduct of bankers across the sector, including NAB. The bank told the Commission it identified more than 1,300 customers who may have been affected by the misconduct of dozens of its bankers.
NAB has admitted to the inquiry that some of its advisers had engaged in dishonest and illegal conduct such as misappropriation of client funds. It has paid A$19 million in compensation to customers.
It also said that for years it charged advisory fees to hundreds of thousands of clients without providing them with services or allocating them an adviser.
In an open letter to customers and shareholders, Thorburn said that 20 bankers in New South Wales and Victoria have had their employment terminated, or are no longer with NAB as a result of its investigation.
Thorburn conceded that bad behavior has no place in a bank.
"I also know (Australian Securities and Investment Commission James Shipton) talked about focusing more on and clamping down on bad behavior. And I agree totally with that because when we have bad behavior in a bank it's really destabilizing and debilitating."
"We need to find it, fix it, and hold people accountable. And we will continue to do that."
However, the NAB boss defended the majority of his bankers — there are 12,000 versus the 20 who were involved, pointing out "there's a lot of people here who are doing absolutely the right thing."
— Reuters contributed reporting to this article.
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6d557e69eb9bb915372d9c9ac9327a09 | https://www.cnbc.com/2018/05/18/netflix-turning-michael-lewis-flash-boys-into-a-movie-report.html | Netflix is reportedly turning the Michael Lewis book 'Flash Boys' into a movie | Netflix is reportedly turning the Michael Lewis book 'Flash Boys' into a movie
Michael Lewis, author of Flash Boys.Adam Jeffery | CNBC
Netflix has snagged a project based on Michael Lewis' 2014 non-fiction book, "Flash Boys," according to Deadline.
The story revolves around a group of people that tries to expose "the insidious new ways that Wall Street generates profits."
The adaptation comes just a couple years after the 2015 film, "The Big Short," also based on a Michael Lewis book. Lewis is also known for books like "Liar's Poker" and "Moneyball."
"The world clings to its old mental picture of the stock market because it's comforting; because it's so hard to draw a picture of what has replaced it; and because the few people able to draw it for you have no interest in doing so," Lewis writes in the introduction of "Flash Boys." "This book is an attempt to draw that picture."
VIDEO2:0102:01Fines were a dream for banks: Adam McKaySquawk Box Europe
There are no producers attached to the film, which was initially bought by Sony in 2014, and will be adapted by Ben Jacoby, according to Deadline. Representatives for Lewis and Netflix didn't respond to a request for comment.
Read more about the project on Deadline.com.
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2b1a2c08f45dd82ea042a48cc5a02af6 | https://www.cnbc.com/2018/05/18/police-man-arrested-after-firing-shots-at-trump-golf-club.html | Police: Man arrested after firing shots at Trump golf club | Police: Man arrested after firing shots at Trump golf club
A man was arrested early Friday after exchanging gunfire with officers, shouting about President Donald Trump and draping a flag over the counter in the lobby of the Trump National Doral Golf Club near Miami that's owned by Trump, police said.
Police were notified of an "active shooter" about 1:30 a.m., Doral Police Chief Hernan Organvidez told news reporters. He said officers from Doral and Miami-Dade confronted him immediately and exchanged gunfire with the man who was "neutralized" and taken into custody.
Miami-Dade Police Director Juan Perez said the man was shouting about Trump, and "actively shooting."
"He was yelling and spewing some information about President Trump and that's what we know so far. And he had an American flag that he did drape over the counter," Perez said.
Perez said a Doral officer received an unspecified injury.
"You know, these officers did not hesitate one second to engage this individual that was actively shooting in the lobby of the hotel," he said. "They risked their lives knowing that that they had to get in there to save lives in that hotel."
Perez said the Secret Service and FBI were on the way, but that local police were in charge for the time being.
The golf resort previously known as the Doral Resort & Spa was purchased by the Trump Organization in 2012. Its signature course is the Blue Monster at Doral.
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7ba38fb9c7bc2edc5603086295916106 | https://www.cnbc.com/2018/05/18/retirement-should-be-like-being-a-teenager-again-and-it-can-be.html | Retirement should be like being a teenager again | Retirement should be like being a teenager again
Emmanuel Faure | Getty Images
One of the most interesting things I do for International Living is interview retirees and expats for a series of audio podcasts.
They're simply phone chats with people who have made successful moves abroad. We talk about what they did before they moved, why they decided to move abroad, how they did it, and what they're doing now.
More from International Living: Europe's top 5 affordable retirement havens How to spend your summer in Ireland How to spend 3 days in Rome
I'm thinking of this today because I just did an interview with a Canadian expat who relocated to Coronado, Panama, and the phrase she used to describe the life she and her husband now live in this bustling little beach town west of Panama City is still stuck in my head.
"It's like being 15 again," she said.
She said this at the end of a fairly long explanation of how she and her husband dealt with the legal and bureaucratic issues of moving full-time to Panama. It took a while to get their resident visas. It took a while to finalize the purchase of their house in Coronado. It took a while to do the renovations they wanted.
Bureaucracies are pretty much the same the world over, but she said that at the end of it all…when everything was taken care of, all the paperwork was filed, and all the dust had settled…they had no real burning issues or responsibilities left to deal with.
They were legal residents of a tropical paradise living comfortably on their retirement savings without mortgage or debt of any kind.
They were, essentially, 15-year-olds on permanent summer vacation.
Permanent summer vacation in Panama.
No work, no debt, no deadlines, no snow, no worries.
What an amazing concept.
It's what most of us believe retirement should be like. After a lifetime of working and being responsible for ourselves and others, retirement should be like a permanent summer vacation.
Retirement should feel like it did when you were 15 and the last bell of the last class of the last day of the school year rang.
It should feel like running out the door into the sunshine and realizing you didn't have to go back in there again all summer.
Only summer lasts forever.
A lot of the retirees I talk to who have moved abroad say essentially the same thing, but no one has said it quite as simply and clearly as my friend in Coronado. She put the entire concept of a successful retirement abroad in a phrase that I've now adopted as my model for what the ideal retirement is like.
It's like being 15 again.
That's something to aspire to. That's something to shoot for. That's something devoutly to be wished.
And, because there are so many places abroad that can make exactly this kind of retirement possible, it's something that people are actually doing every day.
I know, because I talk to those people every day. People who, no matter what their age in years, are essentially 15-year-olds on permanent summer vacation.
That's exactly how I want to retire.
Commentary by Dan Prescher, a writer for International Living. Prescher is a native of Omaha, Neb., who currently lives in Cotacachi, Ecuador. Since joining International Living in 2001, he and his wife have lived and worked in Ecuador, Panama, Nicaragua and three locations in Mexico.
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991f0d34e81c961bf9bee5f090f455d4 | https://www.cnbc.com/2018/05/18/royal-wedding-prince-charles-to-walk-meghan-down-the-aisle.html | Prince Charles to walk Meghan down aisle at royal wedding | Prince Charles to walk Meghan down aisle at royal wedding
Dan Kitwood | WPA Pool | Getty Images
Prince Charles will walk Meghan Markle down the aisle at the royal wedding — stepping in after the father of the bride fell ill just days before the ceremony.
Kensington Palace said Friday that Markle's future father-in-law, the heir to the British throne, would walk the American actress down the aisle at St. George's Chapel in Windsor for her wedding to Prince Harry. The palace says he "is pleased to be able to welcome Ms. Markle to the Royal Family in this way."
The decision comes after feverish speculation about who would have the honor after the bride announced that her father, Thomas Markle, wouldn't attend because of poor health. The bookies had suggested that Markle's mother, Doria Ragland, was the favorite.
VIDEO4:2004:20How rich is the royal family?CNBC Explains
Unlike Ragland, Harry's father has a lifetime of experience in appearing at large-scale public events amid intense scrutiny. The palace said Markle had asked Charles to offer a supporting arm.
Having the father of the groom take the honor offers yet another twist in a royal wedding that is proving to be different than many others. Normally such occasions are choreographed to the second — and replete with tradition.
But things began to unravel last week after it emerged that Thomas Markle allegedly staged paparazzi photos in what celebrity website TMZ said was an effort to improve his image and show him to be a loving father preparing for the big day.
Speaking from Windsor, TMZ's Sean Mandell told the BBC that the father was hurt by negative headlines and inaccurate portrayals.
"He was trying to explain his side of things - that him working with the paparazzi for those staged photos was an attempt to recast his image to show him as a loving father who was getting ready for his daughter's wedding, and not as a reclusive lush."
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d99599064573862757ba113b96ef760e | https://www.cnbc.com/2018/05/18/sneaker-sales-are-growing-as-sales-of-high-heels-tumble.html | Sneaker sales are growing as sales of high heels tumble | Sneaker sales are growing as sales of high heels tumble
VIDEO1:0701:07Women's sneakers sales are growing as high heels slideNews Videos
Rhiannon Anderson has about 50 pairs of high heels in her closet. But she never wears them.
"We're kind of in the countryside," said Anderson, a stay-at-home mom in Alpharetta, Georgia. "If you wear high heels people will look at you weird."
Instead, Anderson, 39, spends most of her days in sneakers. And she's not the only one.
As American fashion has slowly become more casual, so has footwear. That trend has become especially apparent in women's sneaker sales, which have surged 37 percent throughout the U.S. in 2017. Meanwhile, sales of high heels have declined 11 percent during the same time period, according to the NPD Group's Retail Tracking Service.
Brands like Nike, Adidas, Dr. Scholl's, Roxy, Puma, Steve Madden and UGG, are just a few of the names that are getting the benefit of women slipping into more comfortable footwear. The trend is twofold: Consumers want comfort, and there are more options across all shoe categories.
Getty Images
"It's becoming kind of a basic consumer need to have comfort and the desire to be comfortable because everybody's so busy and running around all the time," Beth Goldstein, NPD's executive director and industry analyst for fashion footwear and accessories, told CNBC.
"Brands that are focusing on comfort are doing better, because that's definitely something that women of all ages want," she said. The sneaker trend will likely continue in the double digits for the next few years, Goldstein added, as it becomes more of a lifestyle choice.
Even in large metropolitan areas, women are choosing comfortable footwear. Women ride the subway in New York City wearing a variety of sneakers and flats.Kellie Ell | CNBC
Conversely, sky-high heels — shoes with heels three inches or higher — are tumbling the fastest, Goldstein said, as consumers gravitate toward one pair of shoes that can be worn both day and night. Even for dressier occasions, more sensible heels are increasingly popular, the analyst said.
But it's not for a lack of choices in the shoe department. Retail inventory of high heels has risen 28 percent in 2017, compared with the year before, according to Edited, a market research firm.
"I don't think it's so much of a rejection in high heels as much as it is that there are many alternatives," said Gerald Storch, CEO of Storch Advisors, a retail advisory firm. He said women are actually buying more shoes — just across different categories.
"Women still wear high heels for for fancy events," Storch said, who has also served as vice chairman of Target. In fact, the boom in sensible shoes has become a way for consumers to express their personalities, he added.
"You can show masculinity, you can show femininity," he said. "You don't simply have to take a different color of a high heel shoe."
A store front in Manhattan displays a variety of popular athletic footwear.Kellie Ell | CNBC
Meanwhile, athletic footwear grew 2 percent in the U.S. last year, generating nearly $20 billion in sales, according to NPD. Among women's leisure sneakers, Adidas and Nike drove almost half the growth in the segment.
Another contender competing for market share are designer sneakers. Rapper Kanye West and Stella McCartney both have collaborations with Adidas. Rap artist Kendrick Lamar has also teamed up with Nike. Rihanna's Puma line was so popular it sold out online.
For women like Liz Mitrani, 37, a dentist in New Jersey, the proliferation of sneakers provides both variety and comfort. Mitrani told CNBC she alternates between Prada sneakers and flats while at work, but stopped wearing heels "whenever possible."
"There are so many sneaker choices," Mitrani said. "You can customize them. It's a thing."
As for stay-at-home mother Anderson, she recently ordered a pair of Adidas NMDs online. But she said she's holding on to her heels, "just in case."
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0088c4994926f5893c87bebc201a69be | https://www.cnbc.com/2018/05/18/tgi-fridays-staff-stage-walk-out-in-the-uk-over-tips-dispute.html | TGI Fridays staff stage walkout in the UK over tips dispute, threaten ‘summer of disruption’ | TGI Fridays staff stage walkout in the UK over tips dispute, threaten ‘summer of disruption’
Pedestrians walk past a T.G.I. Friday's in New York.Adam Jeffery | CNBC
Employees at two TGI Fridays restaurants in the U.K. held a 24 hour walkout Friday over a dispute on tips and wages, with more branches set to follow suit.
Union representatives for workers at the American diner chain have threatened a "summer of disruption" if its needs are not met.
The anger stems from a policy introduced by the chain in February that redistributes tips from waiters to kitchen staff, effectively allowing a raise for back-of-house staff while incurring no costs on the company itself. Unite, the U.K.'s largest union, said that the change would cost TGI Fridays' waiters, most of whom are on minimum wage, up to £250 ($286) a month in lost income.
TGI Fridays denied accusations that it was paying staff unfairly. The company plans to keep its restaurants open during the walkout, according to a TGI Fridays spokesman, who said that it was working with its employees to find a solution.
"We believe all our team members should be — and are — treated and paid fairly," the spokesman said.
The 24-hour strike is underway in the restaurant's Milton Keynes and Covent Garden branches, with locations in Manchester's Trafford Centre and London's Haymarket Piccadilly to go on strike next week.
"Our members have sent a very clear message that they will not roll over and be bullied into having their tips taken, without any consultation and with just two days' notice," Unite regional officer Dave Turnbull said in a press statement.
"This isn't about minimum wage servers not wanting to share with their kitchen colleagues. It's about a company whose shareholders have gotten so greedy that they no longer want to pay their hardworking staff anything above the bare minimum."
"We won't back down, but we are ready to talk," Turnbull added.
TGI Fridays in March was fined for failing to pay its staff the U.K. minimum wage, along with more than 40 other hospitality businesses. Consumer spending on casual dining has waned in recent years, putting companies under pressure to cut costs.
The American casual dining chain, which serves "American classics" like barbecue wings and burgers as well as a range of alcoholic beverages, operates more than 900 restaurants in some 60 countries. As a franchise operation, franchisees own most of the outlets.
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3f6cfb14ae59cb80c57a39e055aa9783 | https://www.cnbc.com/2018/05/18/the-world-trade-center-is-finally-nearing-completion.html | The World Trade Center is finally nearing completion | The World Trade Center is finally nearing completion
Construction workers work on the roof of Three World Trade Center high over Manhattan and Brooklyn on April 5, 2017, in New York City.Gary Hershorn | Getty Images
It's finally happening. More than 16 years after the World Trade Center tragedy, a major component of the rebuilt WTC site is getting ready to open.
3 World Trade Center will be opening in early June, with lead tenants including music streaming firm Spotify and advertising giant GroupM. It will join 1 and 4 World Trade Center, the other two major buildings on the site, along with 7 World Trade Center on Greenwich Street.
The completion of this phase of the World Trade Center comes as the Financial District of New York is experiencing a renaissance.
I was at the World Trade Center during the Sept. 11 tragedy and worked at the NYSE in the immediate years after. The Financial District was filled with vacancies and remained relatively sparsely populated in those years.
And then, it began to change.
"It's a very different neighborhood than it was in 2001— it's very different than it was even five years ago," Jessica Lappin, president of Alliance for Downtown New York, told me. "We still have financial firms, but what's been amazing is to see tech, media, advertising firms — companies like Spotify and Group M — move down here as well and really change the face of the workforce and the feel of the neighborhood."
Today, the commercial vacancy rate is below 10 percent, thanks to the infusion of those tech, media and advertising firms like Omnicom Media.
And many people now call it home: 61,000 people live in the Financial District, more than ever before, most of them young professionals.
And there are tourists galore, so many you can barely walk down some streets. Nearly 14 million came downtown in 2017 to visit Wall Street and the 9/11 Memorial, an 8 percent increase from 2016.
The hotel business is booming as well: there are 7,000 hotel rooms in 32 hotels downtown, with another 2,000 under construction.
The World Trade Center Transportation Hub, known as the "Oculus," was completed two years ago and serves 250,000 commuters a day.
The formerly rundown Seaport District is bustling with new shops and businesses, including new restaurants by Jean-Georges Vongerichten and David Chang. Live Nation is opening a 3,400-person rooftop entertainment complex in August that will kick off with performances by Amy Schumer. Sports television giant ESPN also unveiled its new production studios on Pier 17.
Plus, construction on the Ronald O. Perlman Performing Arts Center began last year, and it is expected to open in 2020.
As for the Trade Center, it's taken awhile, but the nearly 8 million square feet of space at the three main buildings is slowly being filled. 1 World Trade Center is now nearly 80 percent leased. Even the newly opening 3 World Trade center is nearly 40 percent leased, and 4 World Trade Center is 100 percent leased.
With so much going on, downtown leaders are trying to improve traffic flows around the New York Stock Exchange, a major business, tourist and business destination. They've also proposed moving the now-iconic Wall Street bull, as well as the Fearless Girl, from their present location in lower Broadway to right in front of the NYSE.
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a5984d4908b220b311fd6ab408c493c0 | https://www.cnbc.com/2018/05/18/top-performing-small-cap-etfs-ytd.html | ETF Spotlight | ETF Spotlight
Police officers are seen in front of a cargo ship with containers at a port in Qingdao, Shandong province, China April 6, 2018.Reuters
The U.S. stock market is on the mend. After getting walloped by two back-to-back corrections in February and March, the S&P 500 has recovered nicely in May, and once again finds itself in positive territory for the year. It's been a wild ride to get here, but the venerable index is up 5 percent from its lowest closing level of the year, and has returned a decent 2.1 percent on a year-to-date basis.
That said, there's more ground to make up before the S&P 500 has completely recovered. From its all-time high of 2,873 set in January, the index is still down 5.6 percent.
Yet while the S&P 500 has more work to do before hitting new highs again, another index is already there. The iShares Russell 2000 ETF (IWM), a $44 billion fund that tracks the Russell 2000 Index, briefly eclipsed its January high on Monday.
The ETF, which holds shares of small U.S. companies, is up 9.5 percent from its lowest closing level of the year and has returned 4.7 percent on a year-to-date basis, easily outpacing the large-cap S&P 500 on both counts.
More from ETF.com:
The next bond crash: An ETF storyBarely any bitcoin left in this booming ETFWhy I don't use target date funds
Analysts say small-caps are outperforming their large-cap counterparts for several reasons. Most of those reasons stem from the fact that small-caps are more focused on the domestic U.S. economy than large-caps.
According to Alec Young, managing director of global markets research for FTSE Russell, small-caps get about 20 percent of their revenues from overseas versus about 35 percent for large-caps.
That more domestic revenue footprint has helped small-caps in a variety of ways, he says, including more exposure to the Republican tax cuts; more exposure to reduced federal regulation; less exposure to geopolitical concerns; and less exposure to trade jitters.
Even as small-caps have soundly outpaced their large-cap counterparts, analysts are split as to whether they will continue to outperform.
"When the economy is stronger than normal, small-caps do better," Ryan Detrick, senior market strategist for LPL Financial, told Reuters. "With a good economy like we've seen happening this year, we fully expect this to keep playing out in the second half of the year."
Ari Wald, head of technical analysis at Oppenheimer, agrees with the bullish assessment for small-caps. In his view, the U.S. dollar should continue moving higher from here, making small-caps relatively more attractive compared to large-caps.
The rising dollar "should be a tail wind for small-caps; they have relatively lower multinational sales than large-caps," he told CNBC. "Looking at the relative ratio between the Russell 2000 and the S&P 500, you're seeing small-caps begin to outperform versus the large-caps, in conjunction with that turn in the dollar, and we think that continues. We're especially bullish on small-cap growth," Wald said.
Wald is bullish on small-cap growth stocks, which have done even better than the small-cap group as a whole. He recommends the iShares Russell 2000 Growth ETF (IWO), which is up 6.7 percent this year, and holds nearly half of its portfolio in technology and health care stocks.
However, not everyone is convinced the run in small-caps will continue. Eduardo Lecubarri, global head of small- and midcap equity strategy at J.P. Morgan, says small-caps will begin to underperform once the market catches wind of a recession.
"At some point, the market will start to sell [small and midcaps] in anticipation of a recession," he told Bloomberg.
Lori Calvasina, head of U.S. equity strategy at RBC Capital Markets, makes a similar argument against small-caps.
"For well over a year, small has lagged large on the sales beat rate, last seen in 2006-08 before the peak in the bull market," she said. "Small's inability to keep up with large on sales beats helps keep us neutral on small versus large, offsetting other advantages for small, such as flows."
Regardless of where one sees small-caps going from here, it's undeniable they've been hot this year. Out of the entire universe of U.S. small-cap equity ETFs, the vast majority have positive returns so far in 2018. The only laggards are high-dividend and value funds, which have been trounced by their growth counterparts.
See the table below for a list of the top-performing small-cap ETFs of the year.
Top small-cap ETFs in 2018
Ticker Fund YTD Return (%) PXSGPowerShares Russell 2000 Pure Growth Portfolio9.63URTYProShares UltraPro Russell20009.42SAAProShares Ultra SmallCap6009TNADirexion Daily Small Cap Bull 3x Shares8.88JSMLJanus Henderson Small Cap Growth Alpha ETF5.98JKKiShares Morningstar Small-Cap Growth ETF7.74FYCFirst Trust Small Cap Growth AlphaDEX Fund7.84UWMProShares Ultra Russell20007.26SLYGSPDR S&P 600 Small Cap Growth ETF6.91VIOGVanguard S&P Small-Cap 600 Growth ETF6.69
— By Sumit Roy, ETF.com
To get the latest ETF news in your inbox, sign up for ETF.com’s ETF newsletter.
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0163b80ea5da488ecc617fac3c117748 | https://www.cnbc.com/2018/05/18/uber-chief-product-officer-jeff-holden-to-leave-in-latest-executive-departure.html | Uber chief product officer to leave in latest executive departure | Uber chief product officer to leave in latest executive departure
Jeff Holden CPO, Uber, speaks on 'Uber's flying cars' during the third day of Web Summit in Altice Arena on November 08, 2017 in Lisbon, Portugal.Horacio Villalobos | Corbis | Getty Images
Uber Technologies Chief Product Officer Jeff Holden is leaving the ride-hailing company, an Uber spokesman told Reuters on Thursday, the latest of more than a dozen senior executives to depart since last year.
Holden oversaw Uber Elevate, the company's flying car operation, which is now headed by Eric Allison, the spokesman said, but declined to elaborate on the reason for his departure.
New Chief Executive Officer Dara Khosrowshahi has been shaking up the company since taking over Last August aiming to improve Uber's reputation after a string of scandals.
Uber, along with Lyft, scrapped mandatory arbitration to settle sexual harassment or assault claims earlier this week, giving victims several options to pursue their claims including public lawsuits.
Uber also launched a new app for its drivers last month, in an effort to improve an often contentious relationship.
Uber's chief legal officer, Salle Yoo, and head of external affairs Dave Clark left the company in September.
Uber is also searching for a chief financial officer who can help take the company public in 2019. The CFO position has been vacant since 2015.
The Wall Street Journal earlier reported that Holden, who was hired by former Uber Chief Executive Officer Travis Kalanick from Groupon, told colleagues that Thursday was his last day with the company
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fc137a7b470b07af86d851057ba21e4d | https://www.cnbc.com/2018/05/18/us-china-trade-talks-may-hold-the-key-to-whether-stocks-finish-the-week-higher.html | US-China trade talks may hold the key to whether stocks finish the week higher | US-China trade talks may hold the key to whether stocks finish the week higher
The former son-in-law of Paul Manafort, the one-time chairman of Trump's campaign, has reportedly cut a plea deal with the Justice Department that requires him to cooperate with other criminal probes. (Reuters)* How a Russian oligarch linked to Trump lawyer Michael Cohen turned a California state park into a mini Moscow (CNBC)
President Trump gives a boost to criminal justice reform efforts today, hosting a summit at the White House aimed at bridging the partisan divide in Congress and the states to shrink the nation's prison population. (USA Today)* Trump administration to tie health facilities' funding to abortion restrictions (NY Times)
House Republicans are bracing for a fight today over the farm bill, with GOP lawmakers sharply divided over everything from sugar subsidies to food stamp benefits that could jeopardize passage. (USA Today)
Uber's chief product officer is leaving the ride-hailing giant, the latest in over a dozen senior executive departures since last year when Dara Khosrowshahi took over as CEO from co-founder Travis Kalanick to improve the company's reputation after a string of scandals. (Reuters)
Billionaire entrepreneur Elon Musk detailed the Boring Company's plans to build mass transit tunnels beneath Los Angeles, saying the fare for the up-to-150 mph Loop system would cost $1. (CNBC)
PayPal (PYPL) is buying European financial tech firm iZettle for $2.2 billion. The largest acquisition in PayPal's history would accelerate the company's move into brick-and-mortar stores around the world. (CNBC)
Microsoft (MFST) co-founder Bill Gates told an audience at a recent meeting of his philanthropic organization that President Trump twice asked him the difference between HPV and HIV. (CNBC)
Amgen's (AMGN) migraine prevention treatment Aimovig won FDA approval, making it the first such drug to do so. The injectable will have a list price of $6,900 per year, less than some analysts had expected. (Reuters)
A floating Pacific island is in the works with its own government, cryptocurrency and 300 houses. It's a pilot program in partnership with the government of French Polynesia. (CNBC)
Meghan Markle will be walked down the aisle at tomorrow's royal wedding to Prince Harry by her future father-in-law Prince Charles, who stepped in after the bride's dad fell ill just days before the ceremony. (AP)
The CBS (CBS) board voted to issue a special dividend that would cut the Redstone family's voting power to about 20 percent from 80 percent, but the move cannot take effect unless it can overcome legal challenges by Shari Redstone.
The toy mogul behind Bratz dolls offered to merge his MGA Entertainment with Mattel (MAT). But Mattel has rejected the approach, according to The Wall Street Journal.
Billionaire David Tepper's Appaloosa Management won FTC clearance to take an activist position in drug-maker Allergan (AGN). Allergan said it welcomes all investments in the company.
AmTrust Financial Services (AFSI) is under fire from activist billionaire Carl Icahn, who has disclosed a 9.38 percent stake in the company. Icahn is fighting an attempt to take the compensation insurer private.
Japan's Fujifilm is planning to sue Xerox (XRX). The U.S. photocopier firm abandoned its $6.1 billion merger deal this week in a settlement with activist investors, including Icahn.
Ryan Reynolds' anti-hero sequel, R-rated Deadpool 2, in theaters nationwide Friday, returns with relentless lampooning and scattershot jokes that made the first movie a successful hit. (USA Today)
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9ad7725d48358170c2b5bf7870eb4fda | https://www.cnbc.com/2018/05/18/vietnam-formally-launches-investigation-into-uber-grab-merger.html | Vietnam trade ministry says formally launched investigation into Uber-Grab merger | Vietnam trade ministry says formally launched investigation into Uber-Grab merger
A woman using the Grab app on an Apple iPhone in Ho Chi Minh City, Vietnam.Godong | UIG | Getty Images
Vietnam's Ministry of Industry and Trade on Friday officially launched an investigation into the takeover of Uber Technologies' Southeast Asia business by rival Grab, the ministry said.
The investigation will take 180 days, with the possibility to be extended by up to 120 days, the ministry said in a statement.
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5f48a46a2edcbd324ba27ec600ca5dd4 | https://www.cnbc.com/2018/05/18/vladimir-putin-favours-status-quo-with-new-government-lineup.html | Putin favours status quo with new government lineup | Putin favours status quo with new government lineup
President-elect Vladimir Putin ahead of being sworn-in as President of Russia at St Andrew's Hall of the Moscow Kremlin.Mikhail Metzel | TASS via Getty Images
Russian President Vladimir Putin endorsed a new government line-up on Friday at the start of his new term in office, sticking in most cases with the incumbents but elevating two newcomers with ties to the intelligence services.
Dmitry Medvedev, whom Putin had already reappointed as prime minister, proposed the new cabinet at a meeting with Putin in the Black Sea resort of Sochi that was broadcast live on Russian state television.
"Almost all the candidates are well-known people with experience and a good track record at their previous places of work," Putin said.
"I give my approval," he said.
The big-hitters in Putin's team kept their jobs: Foreign Minister Sergei Lavrov, Defence Minister Sergei Shoigu, and Alexander Novak, the country's energy minister who helped mastermind a global deal to prop up crude oil prices.
Maxim Oreshkin, appointed economy minister in late 2016, will retain his job, as will trade and industry minister Denis Manturov, and Sports Minister Pavel Kolobkov.
Medvedev named Yevgeny Zinichev, who served as Deputy Director of Federal Security Service (FSB), as the new emergency minister.
Medvedev put forward the son of FSB chief Nikolai Patrushev, Dmitry, for the job of agriculture minister.
There were no places in the cabinet for Igor Shuvalov and Arkady Dvorkovich, who were deputy prime ministers in the outgoing government. They had positioned themselves as champions of private business, though with limited practical effect.
The currency market reacted negatively to the appointments in the minutes after the lineup was unveiled.
The rouble pared gains and weakened to 62.19 versus the dollar from levels of 62.08 seen before the announcement.
Putin secured a new six-year term in office after more than 70 percent of voters backed him in a March 18 presidential election. He is now in his second consecutive term, and his fourth term overall.
Putin was sworn in for the new term in early May, and signaled he would keep faith with a policy direction that, among other things, has brought Russia into conflict with the West.
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d17561230a3a95d000dadc73fb3c80a8 | https://www.cnbc.com/2018/05/18/your-first-trade-for-friday-may-18.html | VIDEO1:1501:15Final Trade: EOG, BABA & moreFast Money
The "Fast Money" traders shared their first moves for the market open.
Tim Seymour was a buyer of EOG Resources.
Karen Finerman was a buyer of Golar.
Steve Grasso was a buyer of Alibaba.
Guy Adami was a buyer of Advanced Micro Devices.
Trader disclosure: On May 18, 2018, the following stocks and commodities mentioned or intended to be mentioned on CNBC's "Fast Money" were owned by the "Fast Money" traders: Tim Seymour is long AMZA, ACB.TO, APC, APH.TO, BABA, BAC, BX, C, CCJ, CLF, CMG, CRON, CSCO, CX, DAL, DPZ, DVYE, EEM, ERJ, EUFN, EWM, FB, FXI, GE, GILD, GM, GOOGL, GWPH, HAL, INTC, JD, LEAF, MAT, MCD, MO, MOS, MPEL, PAK, PHM, PYPL, RH, RL, SBUX, SQ, T, TIF, TWTR, UA, UAL, VALE, VIAB, VOD, X, XLE, XRT, YNDX, 700.HK. Tim is short IWM, RACE, SPY. Karen Finerman's firm is long ANTM, C, FB, FL, FNAC, GOOG, GOOGL, GLNG, GMLP, INTC, JPM, KORS puts, LYV, PAH, SPY puts, SPY put spreads, WIFI. Her firm is short IWM. Karen Finerman is long AAL, BAC, BOT Bitcoin, Bitcoin Cash, Ethereum, C, CAT, DAL, DVYE, DXJ, EEM, EPI, EWW, EWZ, DVYE, FB, FL, GM, GMLP, GLNG, GOOG, GOOGL, INTC, JPM, LYV, KFL, KORS, KORS calls, MA, MTW, PAH, SEDG, SPY puts, TACO, WIFI, WFM. Karen Finerman is short TBT calls. Bitcoin and Ethereum are in her kids' Trust. Steve Grasso is long stock AAPL, BABA, CAR, EVGN, GE, JCP, MJNA, MON, MTCH, OSTK, PFE, RAD, SNAP, SQ, T, TSLA, TWTR, VRX. Grasso owns Callable Trigger contingent yield note linked to SPX, RTY, and MXEA. Grasso's kids own EFA, EFG, EWJ, IJR, SPY. Grasso's firm is long stock AMD, COTY, CTL, CUBA, DIA, F, GE, GLD, GSK, HPQ, IAU, IBM, ICE, LEN, MAT, MJNA, MSFT, NE, QCOM, RIG, SNAP, SNGX, SPY, T, TMUS, TWX, UA, WDR, WHR, XRX, ZNGA. Guy Adami is long CELG, EXAS, GDX, INTC. Guy Adami's wife, Linda Snow, works at Merck.
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ff9681eb84644b11ba0088a5cd6c7c8c | https://www.cnbc.com/2018/05/19/melania-trump-home-from-the-hospital-after-kidney-surgery.html | First Lady Melania Trump returns home from the hospital after kidney procedure | First Lady Melania Trump returns home from the hospital after kidney procedure
U.S. first lady Melania Trump stands with President Donald Trump after he signed the Be Best initiative in the Rose Garden of the White House in Washington, U.S., May 7, 2018.Kevin Lamarque | Reuters
After spending several days in the hospital recovering from a kidney procedure, First Lady Melania Trump has been released, the White House said on Saturday.
In a statement, the White House said that "The First Lady returned home to the White House this morning. She is resting comfortably and remains in high spirits."
Earlier this week, Melania Trump went under kidney surgery for a condition the White House characterized as benign. The first lady tweeted on Wednesday that she was in good health, as she recovered at Walter Reed National Military Medical Center in Bethesda.
Melania tweet
"Our office has received thousands of calls and emails wishing Mrs. Trump well, and we thank everyone who has taken the time to reach out," the White House said on Saturday.
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6e4150c955297b755f9cc20a7c656b4f | https://www.cnbc.com/2018/05/19/twitter-ceo-jack-dorsey-8-surprising-facts-about-him.html | Here are 8 things you might not know about billionaire Jack Dorsey | Here are 8 things you might not know about billionaire Jack Dorsey
VIDEO2:1702:17Here are 9 surprising facts about Jack DorseyDigital Original
Jack Dorsey has become one of the most influential techology entrepreneurs in the world, joining the ranks of Steve Jobs and Elon Musk. He boasts the unique distinction of running not just one but two major companies, Square and Twitter. The dual role has earned Dorsey a net worth more than $4 billion, according to Forbes.
The 41-year-old is best-known for co-founding Twitter in 2006, but his tenure there hasn't exactly been smooth. In 2008, Dorsey was fired from the social media network he helped invent, before returning as its chief seven years later.
The company went through some growing pains in his absence. Upon Dorsey's return in 2015, Twitter's stock had been steadily trending downward, but the tide has started to turn. Shares have jumped more than 30 percent this year.
Then there's Dorsey's lesser-known but still prominent and rapidly expanding mobile payments company, Square. In fact, it has been growing even faster than rival PayPal, according to Nomura Instinet. Since early 2016, Square Cash app downloads have averaged 128 percent year-over-year growth each month versus Venmo's 74 percent. Venmo is a unit of PayPal.
Here are some things you may not know about the billionaire.
1. Dorsey was obsessed with emergency dispatch communications as a kid.
His love of trains later led to his obsession with emergency service vehicle dispatch. He was fascinated with the voices on the police scanner. "They're always talking about where they're going, what they're doing and where they currently are and that is where the idea for Twitter came," Dorsey told the CBS program "60 Minutes."
2. He hopes to someday run for mayor of New York City.
Dorsey is a big fan of former New York City Mayor Michael Bloomberg. He once praised Bloomberg as a "guiding light" for tech entrepreneurs in Silicon Valley. Although he currently lives in San Francisco, Dorsey once told Vanity Fair that he loves the Big Apple, saying just thinking about it feels like "a rush of energy."
3. Twitter is part of Dorsey's morning routine.
Dorsey likes to wake up and check the weather. But there's one other thing he always checks: Twitter. The first thing he does is go to Twitter search, so he can see "exactly what's happening exactly right now in the world."
4. The Twitter creator almost went to work for Facebook.
Dorsey reportedly spoke with Facebook CEO Mark Zuckerberg around the time he was ousted as the CEO of Twitter, according to reporter Nick Bilton in "Hatching Twitter: A True Story of Money, Power, Friendship, and Betrayal." Zuckerberg — who at the time mulled buying Twitter — sought to hire Dorsey, but the lack of a defined role prompted Dorsey to set his sights elsewhere, according to an excerpt from Bilton's book.
5. Dorsey hacked his way into his first job – literally.
The budding entrepreneur was trying to get a job at a large dispatch company in New York. But when there was no contact information on their website, Dorsey told "60 Minutes" he found a security hole and emailed the company telling them how to fix it. He was hired just a week later.
6. Dorsey doesn't have an office – or even a desk at Square HQ.
The Square chairman and CEO doesn't have a corner office like you might expect. He prefers to use his iPad and have the freedom to roam around the office. When asked why he doesn't have an office, Dorsey told "60 Minutes" that "there's a self-awareness that other people work here — it's not just you."
7. His fellow Square co-founder Jim McKelvey used to be his boss.
Dorsey was just 15 years old when he became an intern at McKelvey's software company, Mira Digital Publishing. McKelvey was immediately impressed with Dorsey. He even started calling him "Jack the Genius" because there was nothing the young Dorsey couldn't do.
8. Dorsey says Square – not Twitter – will fundamentally change the way people communicate.
Dorsey sent out the very first tweet on Twitter 12 years ago. The social platform has gone on to amass around 100 million daily active users.
TWEET
But Dorsey claims his other business – Square – will be the one to fundamentally change the way people communicate because it speaks the one language we all know: Money. He told "60 Minutes" that it's the one thing that "touches every single person on this planet and at one point in their life they feel bad about it."
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c2e5e3e1710ea553a94fecf4068954b4 | https://www.cnbc.com/2018/05/20/2-point-5b-fund-manager-predicts-major-stock-shift-as-inflation-rises.html | VIDEO2:3202:32$2.5B fund manager sees ‘inconvenient truths,' predicts major market shiftFutures Now
Whether Wall Street is ready or not, veteran fund manager Larry Glazer warns a major shift is coming to the stock market.
Glazer, who manages more than $2.5 billion in assets, acknowledged that the April jobs report didn't signal rising inflation — but it still exists, he contended in an interview.
"Inconvenient truths include the fact that when you have that [a] plummeting unemployment rate and you add in the biggest tax stimulus in three decades, it's ultimately going to lead to higher wages and potentially inflation," the Mayflower Advisors managing partner told CNBC's "Futures Now" last week.
Rising prices are "lagging data. It will show up in the months ahead," Glazer added.
He also noted the recent spike in crude oil prices are starting to filter through the economy, and will create inflationary pressures. Recent evidence suggests gas prices are on the rise ahead of Memorial Day.
"It will begin to affect consumers as the summer driving season kicks in," he added.
Due to the emerging scenario, Glazer is advising investors to limit mega cap stocks and big tech exposure — groups that had been rallying as inflation and interest rates were at historic lows.
"It's about re-positioning portfolios — recognizing the new paradigm," he said, advocating a more domestic approach to investing right now.
He prefers small cap value, Treasury Inflation Protected Securities (TIPS), financials and energy. According to Glazer, they'll be the biggest beneficiaries of rising rates and an inflation comeback.
If this environment feels feels too unsettled, he points out there's always cash.
"A 2 percent money market sounds really great. It's actually outperforming a lot of areas of the stock market," Glazer said. "As you get a bout of volatility later in the year, you can re-position. Put that money to work."
Disclaimer
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712106b3be4b73813f251032ec75cda7 | https://www.cnbc.com/2018/05/20/asia-markets-us-china-trade-stocks-currencies-and-oil-in-focus.html | Asia markets advance as investors digest weekend US-China trade developments | Asia markets advance as investors digest weekend US-China trade developments
Asian markets closed moderately higher on Monday, with weekend developments in U.S.-China talks, regarded as positive by analysts on the whole, in the spotlight.
Japan's edged up by 0.31 percent, or 72.01 points, to 23,002.37, crossing the 23,000 mark for the first time since February as the dollar firmed against the yen. The Topix dipped in and out of negative territory before finishing lower by 0.08 percent, with declines seen in insurers and steelmakers while machinery sector stocks climbed.
Over in South Korea, the Kospi reversed early losses, advancing 0.2 percent to close at 2,465.57.
Greater China markets got a lift following positive trade developments at the weekend. Hong Kong's advanced 0.68 percent by 3:22 p.m. HK/SIN, but was below its intraday high. Utilities and industrials led the climb ahead of the market close.
On the mainland, the edged up by 0.66 percent to 3,214.36 and the Shenzhen composite added 1.05 percent to end at 1,848.06. Logistics firms were given a boost as U.S.-China trade concerns abated, with Cosco Shipping Holdings jumping 7.39 percent.
Stocks Down Under bucked the trend, with the S&P/ASX 200 slipping 0.05 percent to close at 6,084.50 as materials and financials weighed.
On the whole, MSCI's index of shares in Asia Pacific excluding Japan edged higher by 0.1 percent in Asia afternoon trade.
Developments in the U.S.-China trade relationship were digested by investors as markets opened for trade this week. In particular, immediate fears of a trade war were likely put to rest after U.S. Secretary Steven Mnuchin said Sunday that the countries were "putting the trade war on hold" as they worked out an agreement.
Both countries said they had agreed to "substantially reduce" the U.S. trade deficit with China in a joint statement on Saturday. According to the statement, China would significantly increase its purchases of U.S. goods and services, although it remained unclear how much that would amount to.
"Overall, markets should view this positively at the open this week, but will continue to be attentive to further developments," ANZ analysts said in a morning note.
Although Mnuchin's pronouncement was an incremental positive, there were also other moving parts at play in markets, said Jonathan Garner, chief Asia and emerging markets equity strategist at Morgan Stanley.
Higher oil prices were "negative for most of Asia, which is a large oil importer ... We also have a situation where monetary policy continues to tighten in the U.S. and China simultaneously, and that's an issue that's certainly causing pressure on valuations, particularly in equities," Garner told CNBC's "Squawk Box."
U.S. stock index futures, meanwhile, were higher on Monday following Mnuchin's comments, with the implied open for the Dow Jones industrial average more than 200 points higher during Asia morning trade. S&P 500 and Nasdaq futures also pointed to gains.
Stock indexes stateside had closed mostly lower on Friday as investors digested trade-related headlines ahead of the joint statement issued at the weekend. The declines also came as U.S. Treasury yields rose to multiyear highs last week.
On Monday, the yield on the benchmark 10-year U.S. Treasury note edged up to 3.07 percent after easing slightly in the Friday session. The 10-year yield had surpassed 3.1 percent for the first time in around seven years last week.
The dollar index, which tracks the U.S. currency against its peers, stood at 94.021, compared to levels around the 93.7 handle seen on Friday. Against the yen, the greenback traded at 111.30 at 3:17 p.m. HK/SIN as U.S.-China trade tensions were seen to have abated slightly.
In individual movers, shares of LG Electronics closed higher by 0.71 percent following news on Sunday that the chairman of LG Group, Koo Bon-moo, had passed away. Koo's son is expected to be nominated to the company's board as part of succession plans, Reuters said. Other LG affiliates traded lower, with LG Display declining 1.1 percent and LG Chem down 1.6 percent.
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93d6ac1fb30b2e7d4ee68d330b6ed6c7 | https://www.cnbc.com/2018/05/20/david-teppers-latest-investing-move-the-nfls-carolina-panthers.html | Hedge fund billionaire David Tepper's latest investing move: the NFL's Carolina Panthers | Hedge fund billionaire David Tepper's latest investing move: the NFL's Carolina Panthers
Cam Newton #1 of the Carolina Panthers celebrates Ted Ginn Jr. #19 touchdown in the first quarter against the Arizona Cardinals during the NFC Championship Game at Bank of America Stadium on January 24, 2016 in Charlotte, North Carolina.Getty Images
Hedge fund manager David Tepper's reportedly record-breaking bid for the NFL's Carolina Panthers has left many wondering if the billionaire may see the franchise as a long-term investment play.
The value of the average NFL franchise more than doubled in the decade from 2007 to 2017, climbing to $2.52 billion from $957 million, according to Forbes. And despite a long bull market in stocks, the S&P 500 has fallen short of doubling in value. It is up just 77 percent over the same time.
Tepper's deal – which remains subject to NFL approval – is reportedly worth $2.2 billion, the most ever paid for a football franchise and dwarfing the $1.4 billion the Pegula family paid for the Buffalo Bills back in 2014.
But while the deal represents a huge initial buyout, Tepper is likely betting on reliable returns. The Pegulas, for example, have seen the value of the Bills climb to $1.6 billion in just two years, netting $200 million more than their initial investment. But Tepper is also likely watching the industry as a whole as the way people enjoy football continues to evolve.
One relatively recent prospect for football fanatics is the ability to watch games online, with Amazon, Facebook, Twitter and YouTube all vying for an all-important rights contract in recent years.
Last month, the NFL announced that it had reached an agreement to renew its exclusive partnership with Amazon Prime Video to deliver a live digital stream of "Thursday Night Football."
The battle for sports content has been heating up between the tech titans over the last few years. Facebook recently announced that it would exclusively stream 25 Major League Baseball games, while YouTube struck a deal with Los Angeles' Major League Soccer team.
This is the second year Amazon has won a contract with the NFL, reportedly paying $50 million to stream the 10 Thursday night games last year. These burgeoning sources of revenue could prove the next step for the NFL in its quest to keep up with a younger audience.
And that, in turn, could have been one of the reasons Tepper considered buying a sports franchise, according to CNBC contributor and Short Hills Capital Partners founder Stephen Weiss.
"There's always going to be a profit angle, a return on investment calculus," Weiss said. "It still has to be profitable."
Weiss, who's known Tepper and other owners of major sports franchises over the years, said that to assess viewership with the traditional measures may slowly be becoming an outdated model.
"You can't just go by viewership on the major networks, you have to go by other factors because you've got other avenues of revenue," Weiss added. "You've got Amazon, you've got YouTube: That creates arguably even more of a bidding war as well as more ways to leverage the product."
The Panthers deal also comes just after the Supreme Court's ruling allowing states to legalize sports gambling. While the NFL has long opposed legalized sports gambling, the allowance could potentially spell additional revenue sources.
Commenting on the news this week, billionaire investor Mark Cuban said the decision is fantastic news for investors in the sports and gambling industries.
"I think everyone who owns a top four professional sports team just basically saw the value of their team double," the owner of the NBA's Dallas Mavericks said in a "Squawk Alley" interview. "It can finally become fun to go to a baseball game again."
But while NFL continues on as the most lucrative league in the world, some Wall Street brokerages are growing concerned by a recent string of soft ratings and viewership reports.
J.P. Morgan Chase and Credit Suisse both cited weaker ratings and viewership in notes to clients during the 2017-2018 season, explaining that the apparent decline in viewership could wind up affecting major broadcasters like Fox and ESPN.
The weaker numbers were so concerning that Credit Suisse analyst Omar Sheikh cut his earnings per share estimates on CBS for last year's third quarter.
"We expect third-quarter network advertising to decline 3 percent, driven by soft ratings for both the summer schedule and for the start of the NFL season," Sheikh wrote in October, only to be echoed by J.P. Morgan's Alexia Quadrani one month later.
"Ratings are down in 8 of 10 weeks this season," Quadrani wrote. "We note that ratings picked up in 2016 starting in Week 10, which was the first post-Election Day slate of games."
However, CBS ultimately posted mixed results for the third quarter 2017 and defended its partnership with the NFL in its earnings call.
The NFL "is still the best game in town," CBS chief executive Leslie Moonves said in November, echoing Fox Sports' Shanks. "There's no better way for advertisers to reach a mass audience, and it still provides the best promotional platform to us to launch our new shows."
Ultimately, the relatively soft viewership numbers in 2017 will likely do little to usurp the commanding leadership the NFL – and professional sports more broadly – has over the TV world.
According to Nielsen data, seven of the 10 most popular live or single telecasts in 2017 through November were NFL events, with Super Bowl LI, the Super Bowl postgame, and the AFC Championship game claiming first, second and third place respectively.
That trend is unlikely to end anytime soon, with the earliest 2018 numbers from Nielsen already showing the NFL at the top of the list yet again, likely adding comfort to Tepper in his bid for the Panthers.
"It's like owning a Picasso. There aren't many out there and they rarely come up for sale," said Joe Favorito, a Columbia University professor and strategic communications executive in New York. "You can't find another business, no matter what you do, that if you just maintain it, it appreciates in value like this."
The most recent surge in value, Favorito said, is likely due to the ruthless bidding war for media rights, driving up the league's massive annual haul.
Though specific insights into the NFL's financial situation are limited, a financial disclosure by the Green Bay Packers – the only publicly owned franchise in major U.S. sports – revealed that the NFL distributed a record $7.8 billion to its 32 teams in 2016, according to Bloomberg.
The sizable annual allowance – and its yearly increases – are a direct result of deals like that inked by Fox Sports in January. In exchange for the rights to broadcast the NFL's "Thursday Night Football" for the next five seasons, Fox will dole out $3 billion – or roughly $60 million per game – according to a Reuters source.
That number is an increase from the $45 million per game CBS and Comcast's NBC were paying to broadcast rights during the last season, according to the source.
"You're talking about multi-year, multi-billion dollar media contracts," Favorito said. "That's been the basis for teams that come in: There is a massive pool of assets for you to use."
"Every time there's a sale, a new bar is set."
Disclosures: Comcast is the owner of NBCUniversal, parent company of CNBC and CNBC.com. CNBC owns the exclusive off-network cable rights to "Shark Tank," which features Mark Cuban as a judge.
Disclaimer
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847accaf77a8c88b5e3462e5b1f794d3 | https://www.cnbc.com/2018/05/20/eu-could-compensate-firms-hit-by-us-sanctions-over-iran.html | EU could compensate firms hit by US sanctions over Iran: French finance minister | EU could compensate firms hit by US sanctions over Iran: French finance minister
France's Bruno Le Maire.Eric Peirmont | AFP | Getty Images
France is looking to see if the European Union could compensate European companies that might be facing sanctions by the United States for doing business with Iran, said French finance minister Bruno Le Maire on Sunday.
Le Maire referred to EU rules going back to 1996 which he said could allow the EU to intervene in this manner to protect European companies against any U.S. sanctions, adding that France wanted the EU to toughen its stance in this area.
In 1996, when the United States tried to penalize foreign companies trading with Cuba, the EU forced Washington to back down by threatening retaliatory sanctions.
European firms doing business in Iran face sanctions from the United States after President Donald Trump withdrew from a 2015 nuclear deal with Iran.
"Are we going to allow the United States to be the economic policeman of the world? The answer is no," Le Maire told C News TV and Europe 1 radio on Sunday.
Le Maire added it was important Italy kept its EU budget commitments, in light of plans by Italy's new coalition government to ramp up spending - which could put Rome at odds with the EU.
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60d435311e34976a4b2ebb361bd8cfb3 | https://www.cnbc.com/2018/05/20/forex-dollar-in-focus-as-us-china-trade-war-fears-recede.html | Dollar scales 5-month peak as US-China trade tensions ebb | Dollar scales 5-month peak as US-China trade tensions ebb
Getty Images
The dollar climbed to a five-month peak on Monday as news of a truce between the United States and China on trade tariffs prompted investors to pare back their short positions on the greenback.
Investors have been short the dollar since July last year, but since mid-February, the dollar index has rallied nearly 7 percent. The dollar has been mainly bolstered by generally solid U.S. economic data that has backed the Federal Reserve's tightening stance this year.
The prospect of a resolution to the U.S.-China trade tension has further added to the dollar's shine. The two world's largest economies have agreed to drop their tariff threats for now.
U.S. Treasury Secretary Steven Mnuchin and President Donald Trump's top economic adviser, Larry Kudlow, said on Sunday the agreement reached by Chinese and American negotiators on Saturday set up a framework for addressing trade imbalances in the future.
"In the absence of major economic releases, the headline on the easing of trade tensions with China has been positive for the dollar, although the dollar in general has been doing a little bit better," said Sireen Harajli, FX strategist at Mizuho Bank in New York.
"Economic data in the U.S. has been performing fairly well, in contrast to other parts where things have not been so great," she added.
Harajli cited concerns about Japan's economy, which contracted in the first quarter of 2018, and the euro zone, with Germany, the biggest economy in the region, revising down its first-quarter growth.
VIDEO3:5503:55Asian currencies reacting differently vs 'strong' US dollarCapital Connection
In late trading, the dollar index fell 0.03 percent to 93.60 after earlier hitting a five-month high above 94.
This week, the dollar's fate rests on the Federal Reserve, with several Fed officials speaking this week and the minutes of the U.S. central bank's last monetary policy meeting due out on Wednesday.
Investors will focus on the Fed's inflation outlook. Higher inflation could mean faster interest rate hikes and a stronger dollar.
In other currency pairs, the dollar rose to a four-month high against the at 111.39 and was last at 111.01, up 0.24 percent. The yen has been pressured Treasury yields, analysts said.
The euro, meanwhile, was up 0.04 percent against the dollar at $1.178, after earlier falling to its lowest level since around mid-November.
Europe's single currency has been affected by concerns about political uncertainty in Italy. This week will bring about a further test for stubborn euro bulls with the release of May flash PMI data on Wednesday, with markets waiting to see whether the first-quarter slowdown in Europe has spilled over to subsequent months.
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e9e748fb7671c0a13dbe612be6fd8cc3 | https://www.cnbc.com/2018/05/20/gold-slips-as-us-china-trade-war-put-on-hold.html | Gold hits 2018 low as trade comments lift stocks, dollar | Gold hits 2018 low as trade comments lift stocks, dollar
Gold bullion bars and coins.Getty Images
Gold marked a new low for the year on Monday after U.S. Treasury Secretary Steven Mnuchin declared that a trade war between China and the United States was "on hold," sparking a rally in stocks and the dollar.
Buoyancy in U.S. Treasury yields also weighed on appetite for non-interest bearing assets such as bullion, analysts said.
Spot gold fell to its lowest since late December at $1,281.76 an ounce, but by 1918 GMT it was up 0.1 percent at $1,292.71 an ounce. U.S. gold futures for June delivery settled down 0.03 percent at $1,290.90.
"The dollar's riding high, and the 10-year yield has broken above 3.05 percent for the first time since 2011," Mitsubishi analyst Jonathan Butler said. "This is taking place at a time when we're very close to all-time highs in the U.S. equity markets, and all of this positive news about jobs, about productivity, is feeding into a move towards risky assets."
He said gold could benefit from safe-haven buying in the long run if that exuberance loses steam and inflation pressures mount. But he added: "It's possible that we might see a further correction in the very short term. That will of course depend on the newsflow, and whether the dollar can hold onto its gains."
Gold prices fell below the psychologically important level of $1,300 an ounce last week, and posted the first weekly close below their 200-day moving average since late December.
A stronger dollar makes assets priced in the U.S. currency more expensive for holders of other currencies, while a bounce in yields had added to pressure on gold.
The metal is also being weighed down by expectations that U.S. Federal Reserve will lift U.S. interest rates again next month, further hurting demand for non-yielding assets.
Naeem Aslam, chief market analyst at Think Markets, said investors were now looking ahead to this week's meeting of the Federal Open Market Committee, which sets rates. "If the Fed doesn't tame its hawkish stance, we would expect more weakness in the gold price," he said.
Hedge funds and money managers cut their net long position in Comex gold contracts by 21,294 contracts to 31,327 in the week to May 15, data showed on Friday.
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c389360d17d67265e575ace2488f3785 | https://www.cnbc.com/2018/05/20/south-koreas-lg-group-chairman-dies-from-illness-at-73.html | South Korea's LG Group chairman dies from illness at 73 | South Korea's LG Group chairman dies from illness at 73
Koo Bon-moo of LG group chairman arrives during the President political scandal parliament hearing at national assembly in Seoul, South Korea.Seung-il Ryu | NurPhoto via Getty Images
The chairman of South Korea's LG Group, Koo Bon-moo, instrumental to transforming the country's fourth-largest conglomerate into a global brand, passed away on Sunday after a year-long battle with brain disease.
LG Group said in a statement Koo, 73, had been ill for a year.
A group official said Koo had been fighting a brain disease and had undergone surgery. The official declined to be named due to the sensitivity of the matter.
"Becoming the third chairman of LG at the age of 50 in 1995, Koo established key three businesses - electronics, chemicals and telecommunications - led a global company LG, and contributed to driving (South Korea's) industrial competitiveness and national economic development," LG said.
Under Koo's leadership, the conglomerate changed its corporate brand to LG from Lucky Goldstar and sold LG's semiconductor business to Hyundai, now SK Hynix Inc, under government-led restructuring in the wake of the Asia financial crisis in the late 1990s.
Major affiliates are LG Electronics Inc, display maker LG Display and electric car battery maker LG Chem.
Prior to its chairman's death, LG Group had established a holding company in order to streamline ownership structure and begin the process of succession.
The country's powerful family-run conglomerates are implementing generational succession amid growing calls from the government and public to improve transparency and corporate governance.
LG Corp, a holding company of the electronics-to-chemicals conglomerate, said on Thursday its longtime chairman was unwell and planned to nominate his son to its board of directors in preparation for a leadership succession.
Heir apparent Koo Kwang-mo is from the fourth generation of LG Group's controlling family. He owns 6 percent of LG Corp and works as a senior official at LG Electronics.
The senior Koo's younger brother, the group's vice chairman Koo Bon-joon, who led LG Electronics for many years, effectively managed the conglomerate in his stead.
South Korean prosecutors said this month they raided LG Group's head office as part of a probe into alleged tax evasion by family members controlling the conglomerate.
Analyst do not see a change at the helm being disruptive to the group's business.
"Although Koo passed away at a relatively early age, his son has been already in a senior position and I don't think there will be a big change in governance structure or strategic decisions," said Park Ju-gun, head of corporate analysis firm CEO Score.
The company said Koo's funeral would be held privately at the request of the family.
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ce0cd488832008a53b3729900034c97d | https://www.cnbc.com/2018/05/20/vacation-searches-are-up-datatrek-research-says.html | Vacation searches are up, signaling a strong economy and comfort with employment status | Vacation searches are up, signaling a strong economy and comfort with employment status
Getty Images
The U.S. economy seems to be on solid footing, according to one unusual indicator: vacation searches on the internet.
Google searches for the term "vacation" rose 10 percent in April on a year-over-year basis, said Nicholas Colas, co-founder of DataTrek Research, using Google Trends data. This is positive for the U.S. economy, Colas said, as U.S. workers are usually reluctant to take time off from work.
"There's no way around it: Americans have a complicated relationship with the concept of vacation," said Colas in a note this week. "According to an annual survey done by the US Travel Association, more than half of US workers do not use all their paid-for vacation days."
Two of the most common reasons Americans cite for not using all of their vacation days every year are the fear "looking replaceable" and the cost of travel, Colas said citing figures from the U.S. Travel Association.
"To say you don't take vacation for fear of being fired speaks to job security," he noted. "Cost of travel relates to income and consumer confidence."
The U.S. jobs market is currently in a healthy state. Weekly jobless claims — which refer to the number of unemployment applications filed for a particular week — totaled just 222,000 the week ending May 12, around their lowest levels since the early 1970s. Meanwhile, the market has added jobs for 88 straight months through April, marking one of the longest expansions in U.S. history.
"The US economy is still on solid footing going into the end of Q2," wrote Colas. "It takes a lot to get Americans out of the office, and the Google Trends data shows they are gearing up for summer vacation season," Colas said. "That's not just a function of disposable income. US workers feel secure enough in their jobs to actually step away from them for a week."
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c78e8c17c9be1b0e8c7ea6e72b4f0398 | https://www.cnbc.com/2018/05/21/5-things-to-know-before-taking-out-a-home-equity-loan.html?&qsearchterm= | 5 things you need to know before taking out a home equity loan | 5 things you need to know before taking out a home equity loan
As house prices continue to rise, home equity is becoming a more attractive — and more accessible — source of cash for millions of Americans.
One in four homeowners with a mortgage is now considered "equity rich," meaning that their outstanding mortgage balance is worth less than 50 percent of their home value, according to Attom Data Solutions. TransUnion expects 1.6 million home equity line-of-credit originations this year, double the number seen in 2013.
An ad for a home equity line of credit at a Citibank branch in New YorkScott Mlyn | CNBC
"Whether you stuck it out through the crisis or you bought in the last five years, many homeowners are sitting pretty when it comes to home equity," said Daren Blomquist, senior vice president of communications at Attom Data Solutions. "It's a good time to leverage that."
Borrowing against home equity can be a convenient way to access cash, but it also carries risk, as millions of Americans learned in the housing crisis of 2008. If you're considering it, here's what you need to know.
1. It's getting (slightly) easier to qualify. Since clamping down on credit after the housing bust, lenders are starting to loosen up. More than 10 percent of large banks eased their credit standards somewhat for HELOCs in the first quarter. Still, you'll need to prove you've got the credit and income to pay off the loan.
Lenders typically want borrowers with a credit score of at least 700 and whose total debt amounts to 43 percent or less of total income. The total HELOC and your mortgage balance usually can't amount to more than 80 percent of your home's value, although some banks are letting consumers borrow 85 percent or more.
More from Investor Toolkit:Should you pay off that mortgage before retirement?Choose carefully the 'trusted contact' your advisors ask for Company pensions may be making a comeback
2. The tax rules have changed. Under the new tax law, the home equity interest is only tax-deductible if you're using the money for home renovations on the property tied to the loan. The total amount of home equity debt (including your mortgage) that qualifies for the deduction can't total more than $750,000.
It may still make sense for you to use a HELOC for other purposes, such as debt consolidation or college tuition, but there's no longer a tax benefit to doing so.
3. You'll need to shop around. Get a quote from your current lender, as well as from at least two others, including a credit union and an online bank. Use those quotes to negotiate to make sure that you're getting the best deal. "You can find fairly wide variances in price, interest rates, accessibility and terms from place to place across town," said Keith Gumbinger, vice president at mortgage site HSH.com.
The typical HELOC has a 10-year draw period in which you can take out money as you need it, paying interest only on the money you use. At the end of the draw period, you'll have a 10-year repayment period on the outstanding principle. Since more HELOCs are variable-rate loans, you'll want to know the current interest rate as well as the lifetime cap — the maximum possible rate you'll pay if interest rates go up.
4. There are real risks involved. If you're unable to make payments, your lender could foreclose. While interest rates are relatively low now, they're on the rise. If you have a variable-rate loan, your monthly payment amount will go up along with interest rates. It could be significantly higher in 10 years when you must start repaying the principle. Minimize the impact of the rate increase on your budget by paying off principle before the rate resets.
Also, while home prices have been on a tear in recent years, there's no guarantee they'll continue to rise. If the housing market falters and the value of your home declines, you could end up underwater, owing more than your home is worth. The more equity you keep in your home, the more protected you are against market fluctuations.
"You need to take into consideration that it's possible home values could drop," said Nancy Seely-Butler, a certified financial planner with Ameriprise Financial. "A lot of times people think too short term.
Whether you stuck it out through the crisis or you bought in the last five years, many homeowners are sitting pretty when it comes to home equity.Daren Blomquistsenior vice president at Attom Data Solutions
"You need to think about how it's going to help you today, but also what it's going to look like in five or 10 years."
5. A HELOC isn't the only way to tap your home equity. While less common than HELOCs, home equity loans are another way of borrowing against the value of your home. Also known as "second mortgages," home equity loans typically allow you to take out a onetime loan at a fixed rate. That fixed rate is higher than current HELOC rates, but you'll have payment certainty for the life of the loan.
Another option is a cash-out refinance. This may make sense if the interest rate you're paying on your mortgage now is higher than current rates, but refinancing often carries higher fees and a more complicated application process than getting a HELOC.
— By Beth Braverman, special to CNBC.com
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b98262b4e1c1f9b98832f97daaafefaf | https://www.cnbc.com/2018/05/21/a-new-policy-at-starbucks-people-can-sit-without-buying-anything.html | A New Policy at Starbucks: People Can Sit Without Buying Anything | A New Policy at Starbucks: People Can Sit Without Buying Anything
Protestors demonstrate outside a Center City Starbucks on April 15, 2018 in Philadelphia, Pennsylvania.Getty Images
Last month, two black men who went to a Starbucks in Philadelphia and did not buy anything were denied use of the restroom and asked to leave.
Then an employee called the police and the men were arrested, prompting protests, boycotts and accusations of racism.
Now, Starbucks has changed its policy.
On Saturday the company announced that "any customer is welcome to use Starbucks spaces, including our restrooms, cafes and patios, regardless of whether they make a purchase."
More from The New York Times:2 Black Men Settle With Starbucks and Philadelphia Over ArrestStarbucks Arrests, Outrageous to Some, Are Everyday Life for OthersStarbucks C.E.O. Apologizes After Arrests of 2 Black Men
It added that employees should follow established procedures for "addressing disruptive behaviors," and call 911 in the case of "immediate danger or threat" to employees or customers.
Previously it might have fallen to store managers to decide whether people could sit or use the restroom without buying anything, The Associated Press reported.
"This is now an established policy for consistency across all of our U.S. company operated stores," Haley Drage, a Starbucks spokeswoman, said on Sunday.
The men who were arrested in Philadelphia, Rashon Nelson and Donte Robinson, were waiting for another man, Andrew Yaffe, who is white, for a business meeting on April 12 when the officers arrived. Their arrest was captured in video footage that has been viewed millions of times on social media.
"What did they get called for?" Mr. Yaffe asked in the video, referring to the police. "Because there are two black guys sitting here meeting me?"
Starbucks did not press charges and the men were released hours later.
Melissa DePino tweet
After protests erupted, Starbucks apologized and Kevin R. Johnson, the company's chief executive, released a statement in which he called the arrests a "reprehensible outcome." The employee who called the police was fired.
tarbucks also announced that it would close its stores in the United States on May 29 to give anti-bias training to 175,000 employees.
The company said it had reached a "confidential financial settlement" with Mr. Nelson and Mr. Robinson. The men also reached an agreement with Philadelphia: Each accepted a symbolic $1 and agreed that the city would spend $200,000 to help young entrepreneurs.
"Since the incident in our Philadelphia store in April and the events that followed, we have committed to our partners that we would be evaluating our existing policies and practices to ensure they are clear," Ms. Drage said.
She called the new policy "a part of that commitment."
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823ba5455500a0456ce85b84dc4e0506 | https://www.cnbc.com/2018/05/21/after-hours-buzz-adbe-shop-more.html | Stocks making the biggest moves after hours: Adobe, Shopify and more | Stocks making the biggest moves after hours: Adobe, Shopify and more
Shantanu Narayen, CEO, AdobeMark Neuling | CNBC
Check out the companies making headlines after the bell on Monday:
Shares of Adobe jumped close to 2.5 percent after the bell, before paring gains slightly and settling up nearly 1 percent. The software company on Monday announced an $8 billion stock repurchase program, which extends a previous $2.5 billion program through 2021. Adobe CFO John Murphy said the program "is reflective of our strong cash flow expectations and balance sheet, and reinforces our commitment to returning value and excess cash to our stockholders."
Adobe also on Monday announced the $1.68 billion acquisition of e-commerce platform Magento Commerce, which executives expect will make the Adobe experience more "shoppable."
Shopify stock dropped nearly 3 percent in extended trading after Adobe announced its acquisition. Magento and Shopify are rivals in the e-commerce space.
Pure Storage stock tanked nearly 8 percent in extended trading. The flash storage company reported first quarter earnings and revenue that proved less weak than Wall Street predicted. Pure Storage reported a loss of 7 cents on revenue of $255.9 million versus the 12 cent loss on $251.5 million analysts expected. Pure Storage anticipated second quarter revenue would fall between $296 million and $304 million, whereas the Street was hoping for $299 million in revenue next quarter.
Shares of Nordson fell nearly 6 percent in extended trading, after the dispensing equipment manufacturer reported weaker than anticipated third quarter outlook. The machinery company reported a strong second quarter, coasting on the effects of several automotive electronics acquisitions, but weak outlook stoked fears the momentum wouldn't last.
On a tear from the regular session, Micron stock continued its trajectory, gaining more than 4 percent after the bell. The semiconductor company announced a $10 billion share repurchase program, in conjunction with plans to return at least 50 percent of free cash flow to stockholders beginning in fiscal 2019.
Earlier in the day, Micron strengthened third quarter guidance.
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c89f785e16acb1b97b8aa70ea0b8e085 | https://www.cnbc.com/2018/05/21/american-airlines-flight-attendants-sound-alarm-about-project-oasis.html | American Airlines flight attendants sound alarm about Project Oasis | American Airlines flight attendants sound alarm about Project Oasis
An American Airlines Boeing 737-800 plane takes off from Los Angeles International airport.Mike Blake | Reuters
American Airlines flight attendants, still working through a uniform crisis that dates to September 2016, are up in arms over a major retrofit project now getting underway dubbed Project Oasis.
In a nutshell, it's a project to retrofit nearly 200 Boeing (NYSE: BA) 737-800 aircraft in American's fleet to match the configuration of the much-newer Boeing 737 MAX planes that AA has only just begun to introduce into its fleet.
American has eight MAXs in service now — being flown primarily between New York City and Miami. None operates currently on flights from Chicago's O'Hare International Airport, though AA is expected to have 20 in service by the end of 2018.
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The MAX is said to be more efficient with a different kind of jet engine. But AA flight attendants who have worked on the new plane are no fans of the MAX cabin configuration — hence the concern that some 200 of the Boeing 737-800s will within the next two years be revamped to mirror AA's MAX layout.
AA flight attendants don't like several aspects of the MAX layout, but the biggest point of contention is the lavatories. At a recent crew meeting with AA CEO Doug Parker presiding, a LaGuardia Airport-based flight attendant was brutally blunt about the lavs, noting "You can't get in them."
Additionally, the doors on the two lavatories in the rear of the cabin in particular have proved troublesome. According to the same flight attendant speaking to Parker, the doors are so close to each other that they often lock when two passengers exit, creating headaches for FAs trying to navigate around the galley in close proximity to the lavs.
The Chicago Business Journal obtained an audio tape of the crew meeting with Parker, who certainly listened to what the flight attendant had to say. He also countered that the feedback about the plane has been positive from passengers flying on the MAX between New York and Miami — and they are a demanding lot, Parker said.
By the end of the discussion, Parker did concede that the "slimline" design of the lavs on the MAX makes them smaller, which enables AA to fit more revenue-generating seats on the MAX.
By extension, that also would mean more seats on the 200 or so Boeing 737-800s that are about to be reconfigured.
Per diagrams included in a Project Oasis management memo obtained by the Chicago Business Journal, the reconfigured Boeing 737-800s will have 16 first-class cabin seats with a 37-inch seat pitch, down from a 39- to 40-inch pitch in the current Boeing 737-800 configuration.
The retrofitted 737s will have 30 main cabin extra seats with 33 inches of pitch, down from 34 in the existing 737-800 model configuration. There will be 126 regular economy seats with a 30-inch pitch, down from 31 inches in existing layout.
Altogether, when the Boeing 737-800 planes are retrofitted, they will hold 172 passengers compared to 160 in the existing configuration.
A spokeswoman for American insisted the new seats, which one flight attendant source called "cheap," offer more legroom despite having less seat pitch. Still, when all the reconfiguring is done in two years, some AA flight attendants worry AA customers will not be any more pleased about the layout than they are.
"Simply put, American is becoming America West," said one FA source, referring to the low-cost airline that Parker ran before AW merged with U.S. Airways, which in turn merged with American Airlines to become the world's largest airline.
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8e95a76960283bf09b873adeb0791fd2 | https://www.cnbc.com/2018/05/21/as-consumer-staples-get-slammed-one-name-may-be-primed-for-a-breakout.html | As consumer staples get slammed, one name looks primed for a breakout, Piper Jaffray says | As consumer staples get slammed, one name looks primed for a breakout, Piper Jaffray says
VIDEO2:3502:35Trading Nation: Staples get slammedTrading Nation
The consumer staples sector opens this week at the bottom of the again, but one technician has identified a quiet achiever that could break out.
"Take a look at the chart of Hormel," Craig Johnson, chief market technician at Piper Jaffray, told CNBC's "Trading Nation" on Friday. "It started to show a big, interesting-looking base, reversing a downtrend — it's put in a higher low."
Hormel Foods has risen nearly 5 percent over the past three months, one of just nine consumer staples stocks in the green over that stretch. It is down 1 percent for the year, a fraction of the XLP consumer staples ETF's 13 percent drop.
"Our fundamental analyst Michael Lavery thinks that this is a $39 stock so about 9 percent upside," said Johnson. "On the charts, I see a little bit more, toward the low $40s so 12 to 15 percent upside. That would be one name that we'd find of interest in the space if we had to be there for exposure purposes."
The average analyst price target of $35 a share for the maker of Spam implies 2.5 percent downside from current levels.
The broader sector's technicals suggest more pain ahead, says Johnson. Piper Jaffray has been underweight the group for just over two years.
The fundamentals case for consumer staples also looks ugly, according to Michael Binger, senior portfolio manager at Gradient Investments.
"This classic defensive sector has really been a land mine for investors lately," Binger said on Friday's "Trading Nation." "The way they've been getting earnings growth is to acquire each other, cut costs, take on debt and buy back stock, so this type of financial engineering seems to have hit a wall lately."
Components within the XLP are expected to post collective 12 percent earnings growth for 2018, according to FactSet. earnings are forecast to rise by 20 percent in 2018.
"Investors are really de-rating these stocks, they're taking them from what's been a premium to the market to a discount to the market," Binger said. "So as long as we have companies like General Mills, Phillip Morris, [Molson Coors], Kraft Heinz, I think this is a sector to stay away from."
The XLP is on track to end May in the red, its fourth straight month in decline.
Disclaimer
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0ac88d2cc3242980ee27089783e1559e | https://www.cnbc.com/2018/05/21/asia-markets-us-china-trade-stocks-dollar-and-oil-on-the-agenda.html | Stocks in Asia close mixed as investors digest rising oil prices and trade news | Stocks in Asia close mixed as investors digest rising oil prices and trade news
Asian markets were subdued on Tuesday, with Japan and Australia finishing slightly lower while China advanced as oil prices edged higher.
In Japan, the tracked lower by 0.18 percent, or 42.03 points, to close at 22,960.34 despite starting the session with slight gains. The broader Topix slipped 0.23 percent, with most of its 33 subsectors finishing insurers led losses.
Several index heavyweights, however, clung to gains, with Fanuc higher by 0.88 percent and Fast Retailing rising 0.55 percent by the end of the day.
Markets over in China, however, closed in positive territory after getting a boost late in the session. The was little changed, up 0.02 percent at 3,214.53 and the Shenzhen Composite tacked on 0.38 percent to end at 1,855.16.
Elsewhere, Australia's S&P/ASX 200 declined 0.7 percent to 6,041.90 amid broad-based losses in most sectors. The country's "Big Four" banks mostly finished the day lower, as did major miners. ANZ fell 1.59 percent, leading losses among its peers, while BHP closed down 0.68 percent.
MSCI's index of shares in Asia Pacific excluding Japan, meanwhile, edged higher by 0.15 percent in Asia afternoon trade. Markets in Hong Kong and South Korea were closed on Tuesday for a holiday.
Developments in the trade relationship between the U.S. and China have been in focus for investors. In particular, the Wall Street Journal reported on Tuesday that the U.S. could lift its ban on U.S. companies selling technology to Chinese telecommunications equipment maker ZTE.
That came after U.S. Treasury Secretary Steven Mnuchin told CNBC on Monday that the most recent round of bilateral trade talks with China had "made very meaningful progress" and that it was now up to both parties to implement what had been discussed. Mnuchin's Sunday comment that a trade war between the countries was "on hold" had cheered global markets on Monday.
Despite the broader sense of calm in markets now that trade tensions between the world's two largest economies had eased, some still expected the better outlook to be subject to change.
The U.S. "could easily come back with accusations of insufficient change at a moment's notice, probably at a time when it suited them, the mid-term election in November for example," Robert Carnell, chief economist of ING, said in a note.
The mixed session in the region also came on the back of U.S. stocks closing higher, with the Dow Jones industrial average finishing the session above the 25,000 mark for the first time since mid-March.
On the commodities front, oil prices were slightly higher after touching their highest levels in three and a half years overnight. Markets were concerned over U.S. sanctions targeting Venezuela following the latter's recent election, the results of which were widely condemned.
U.S. crude futures edged up 0.36 percent to $72.50 per barrel and Brent crude futures added 0.19 percent to trade at $79.37.
The dollar index, which tracks the U.S. currency against a basket of peers, traded at 93.620. Against the yen, the dollar firmed to trade at 111.07 at 2:38 p.m. HK/SIN, compared to levels around the 110 handle seen last week.
The euro, which earlier got some reprieve after taking a hit on recent uncertainty in Italian politics, slipped to trade at $1.1762.
In corporate news, Sony said it had reached an agreement to acquire Mubadala Investment's stake in EMI Music Publishing for $1.9 billion. Sony shares were down 1.97 percent, paring steeper declines seen earlier.
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aee60a2a6684436bd7efbd89e0ec62db | https://www.cnbc.com/2018/05/21/banks-adopt-military-style-tactics-to-fight-cybercrime.html | Banks adopt military-style tactics to fight cybercrime | Banks adopt military-style tactics to fight cybercrime
Employees at Mastercard’s “fusion center” in O’Fallon, Mo., Feb. 16, 2018.Whitney Curtis | The New York Times
O'FALLON, Mo. — In a windowless bunker here, a wall of monitors tracked incoming attacks — 267,322 in the last 24 hours, according to one hovering dial, or about three every second — as a dozen analysts stared at screens filled with snippets of computer code.
Pacing around, overseeing the stream of warnings, was a former Delta Force soldier who fought in Iraq and Afghanistan before shifting to a new enemy: cyberthieves.
"This is not that different from terrorists and drug cartels," Matt Nyman, the command center's creator, said as he surveyed his squadron of Mastercard employees. "Fundamentally, threat networks operate in similar ways."
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Cybercrime is one of the world's fastest-growing and most lucrative industries. At least $445 billion was lost last year, up around 30 percent from just three years earlier, a global economic study found, and the Treasury Department recently designated cyberattacks as one of the greatest risks to the American financial sector. For banks and payment companies, the fight feels like a war — and they're responding with an increasingly militarized approach.
Former government cyberspies, soldiers and counterintelligence officials now dominate the top ranks of banks' security teams. They've brought to their new jobs the tools and techniques used for national defense: combat exercises, intelligence hubs modeled on those used in counterterrorism work and threat analysts who monitor the internet's shadowy corners.
At Mastercard, Mr. Nyman oversees the company's new fusion center, a term borrowed from the Department of Homeland Security. After the attacks of Sept. 11, the agency set up scores of fusion centers to coordinate federal, state and local intelligence-gathering. The approach spread throughout the government, with the centers used to fight disease outbreaks, wildfires and sex trafficking.
Then banks grabbed the playbook. At least a dozen of them, from giants like Citigroup and Wells Fargo to regional players such as Bank of the West, have opened fusion centers in recent years, and more are in the works. Fifth Third Bank is building one in its Cincinnati headquarters, and Visa, which created its first two years ago in Virginia, is developing two more, in Britain and Singapore. Having their own intelligence hives, the banks hope, will help them better detect patterns in all the data they amass.
The centers also have a symbolic purpose. Having a literal war room reinforces the new reality. Fending off thieves has always been a priority — it's why banks build vaults — but the arms race has escalated rapidly.
Cybersecurity has, for many financial company chiefs, become their biggest fear, eclipsing issues like regulation and the economy.
Alfred F. Kelly Jr., Visa's chief executive, is "completely paranoid" about the subject, he told investors at a conference in March. Bank of America's Brian T. Moynihan said his cybersecurity team is "the only place in the company that doesn't have a budget constraint." (The bank's chief operations and technology officer said it is spending about $600 million this year.)
The military sharpens soldiers' skills with large-scale combat drills like Jade Helm and Foal Eagle, which send troops into the field to test their tactics and weaponry. The financial sector created its own version: Quantum Dawn, a biennial simulation of a catastrophic cyberstrike.
In the latest exercise last November, 900 participants from 50 banks, regulators and law enforcement agencies role-played their response to an industrywide infestation of malicious malware that first corrupted, and then entirely blocked, all outgoing payments from the banks. Throughout the two-day test, the organizers lobbed in new threats every few hours, like denial-of-service attacks that knocked the banks' websites offline.
The first Quantum Dawn, back in 2011, was a lower-key gathering. Participants huddled in a conference room to talk through a mock attack that shut down stock trading. Now, it's a live-fire drill. Each bank spends months in advance re-creating its internal technology on an isolated test network, a so-called cyber range, so that its employees can fight with their actual tools and software. The company that runs their virtual battlefield, SimSpace, is a Defense Department contractor.
Sometimes, the tests expose important gaps.
A series of smaller cyber drills coordinated by the Treasury Department, called the Hamilton Series, raised an alarm three years ago. An attack on Sony, attributed to North Korea, had recently exposed sensitive company emails and data, and, in its wake, demolished huge swaths of Sony's internet network.
Matt Nyman, a veteran who created Mastercard’s “fusion center,” in O’Fallon, Mo., Feb. 16, 2018. Financial institutions are using military tools and techniques, like “fusion centers” and combat drills, to battle cybercrime.Whitney Curtis | The New York Times
If something similar happened at a bank, especially a smaller one, regulators asked, would it be able to recover? Those in the room for the drill came away uneasy.
"There was a recognition that we needed to add an additional layer of resilience," said John Carlson, the chief of staff for the Financial Services Information Sharing and Analysis Center, the industry's main cybersecurity coordination group.
Soon after, the group began building a new fail-safe, called Sheltered Harbor, which went into operation last year. If one member of the network has its data compromised or destroyed, others can step in, retrieve its archived records and restore basic customer account access within a day or two. It has not yet been needed, but nearly 70 percent of America's deposit accounts are now covered by it.
The largest banks run dozens of their own, internal attack simulations each year, to smoke out their vulnerabilities and keep their first responders sharp.
"It's the idea of muscle memory," said Thomas J. Harrington, Citigroup's chief information security officer, who spent 28 years with the F.B.I.
Growing interest among its corporate customers in cybersecurity war games inspired IBM to build a digital range in Cambridge, Mass., where it stages data breaches for customers and prospects to practice on.
One recent morning, a fictional bank called Bane & Ox was under attack on IBM's range, and two dozen real-life executives from a variety of financial companies gathered to defend it. In the training scenario, an unidentified attacker had dumped six million customer records on Pastebin, a site often used by hackers to publish stolen data caches.
As the hours ticked by, the assault grew worse. The lost data included financial records and personally identifying details. One of the customers was Colin Powell, the former secretary of state. Phones in the room kept ringing with calls from reporters, irate executives and, eventually, regulators, wanting details about what had occurred.
When the group figured out what computer system had been used in the leak, a heated argument broke out: Should they cut off its network access immediately? Or set up surveillance and monitor any further transmissions?
At the urging of a Navy veteran who runs the cyberattack response group at a large New York bank, the group left the system connected.
"Those are the decisions you don't want to be making for the first time during a real attack," said Bob Stasio, IBM's cyber range operations manager and a former operations chief for the National Security Agency's cyber center. One financial company's executive team did such a poor job of talking to its technical team during a past IBM training drill, Mr. Stasio said, that he went home and canceled his credit card with them.
Like many cybersecurity bunkers, IBM's foxhole has deliberately theatrical touches. Whiteboards and giant monitors fill nearly every wall, with graphics that can be manipulated by touch.
"You can't have a fusion center unless you have really cool TVs," quipped Lawrence Zelvin, a former Homeland Security official who is now Citigroup's global cybersecurity head, at a recent cybercrime conference. "It's even better if they do something when you touch them. It doesn't matter what they do. Just something."
Security pros mockingly refer to such eye candy as "pew pew" maps, an onomatopoeia for the noise of laser guns in 1980s movies and video arcades. They are especially useful, executives concede, to put on display when V.I.P.s or board members stop by for a tour. Two popular "pew pew" maps are from FireEye and the defunct security vendor Norse, whose video game-like maps show laser beams zapping across the globe. Norse went out of business two years ago, and no one is sure what data the map is based on, but everyone agrees that it looks cool.
Jason Witty, the chief information security officer at U.S. Bank, admits that the blinking map he breaks out for customer briefings is mostly for show. But it serves a serious purpose, he said: making the command center's high-stakes work more tangible.
"If you show customers the scripts you're actually running, it's just digits on a screen," Mr. Witty said. A big, colorful map is easier to grasp.
What everyone in the finance industry is afraid of is a repeat — on an even larger scale — of the data breach that hit Equifax last year.
Hackers stole personal information, including Social Security numbers, of more than 146 million people. The attack cost the company's chief executive and four other top managers their jobs. Who stole the data, and what they did with it, is still not publicly known. The credit bureau has spent $243 million so far cleaning up the mess.
It is Mr. Nyman's job to make sure that doesn't happen at Mastercard. Walking around the company's fusion center, he describes the team's work using military slang. Its focus is "left of boom," he said — referring to the moments before a bomb explodes. By detecting vulnerabilities and attempted hacks, the analysts aim to head off an Equifax-like explosion.
But the attacks keep coming. As he spoke, the dial displayed over his shoulder registered another few assaults on Mastercard's systems. The total so far this year exceeds 20 million.
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32fd9e632b33a752f779fe832eae54c4 | https://www.cnbc.com/2018/05/21/bigger-trucks-are-getting-smaller-engines-in-bid-to-improve-fuel-efficiency.html | Bigger trucks are getting smaller engines in bid to improve fuel efficiency | Bigger trucks are getting smaller engines in bid to improve fuel efficiency
General Motors Co. (GM) 2019 Chevrolet Silverado pickup truck sits on display.Andrew Harrer | Bloomberg | Getty Images
Big trucks are getting small engines. And that seems to be just fine.
General Motors said Friday it will sell a version of its full-size Chevrolet Silverado pickup with a four-cylinder engine, a highly unusual move for a truck that size.
The engine will replace the six-cylinder currently on the Silverado, and despite the two fewer cylinders, Chevrolet says the new engine is "expected to offer 22 percent more torque, greater fuel efficiency and a stronger power-to-weight ratio than the current model."
It is yet another move by a major American automaker to improve efficiency in its biggest and often best-selling vehicles. U.S. automakers sell a lot of large trucks and SUVs, and have been moving away from selling passenger cars. But these actions have raised fears they will be vulnerable if gas prices rise or strict fuel regulations take effect.
Ford is going all-in on electrification, said Jim Farley, the company's president of global markets, at an event at Ford headquarters in Dearborn, Michigan, earlier in the year.
The F-150 currently has a six-cylinder version of Ford's EcoBoost engines, which use techniques such as turbocharging and direct fuel injection to improve efficiency. That engine was first introduced in 2009 while gas prices were coming off a 2008 record high above $4 a gallon.
Since then, low gas prices and a resurgent economy have sent consumers flocking back to trucks and SUVs, which is a trend industry observers don't see reversing anytime soon.
The trouble is gasoline prices won't always be so low. Of late, prices are on the rise. The U.S. average gasoline price climbed this week to $3 a gallon, due in part to pricier oil and the phasing in of summer-grade fuel.
This shift in the market toward larger vehicles has created a paradox, some would say a problem, in the American auto market. Automakers are making vehicles more fuel efficient than ever, but American consumers are buying less efficient vehicles.
While fuel efficiency has improved in individual models over their previous counterparts, the gains have been offset by a shift in the mix toward the larger vehicles, which has effectively frozen fuel economy for the entire fleet at about 25 mpg.
Meanwhile, fuel economy standards that took effect when Barack Obama was president in 2012 are now up for a midterm review. Automakers met with President Donald Trump earlier in May in part to discuss fuel standards, and the National Highway Traffic Safety Administration is expected to release a potentially updated version of the targets this summer.
The possibility that the government will make any adjustments to the Obama-era fuel economy standards, set in 2012, has inflamed environmentalists.
The trouble, automakers say, is the targets are too ambitious, especially in light of the fact that consumers are hungry for larger vehicles.
Automakers have considerably improved the fuel efficiency of the vehicles they sell. But as things stand they are going to have to keep improving, dramatically, to meet federal fuel efficiency targets over the next several years, and to shield against potential volatility in oil prices.
At the same time they are faced with customers who increasingly favor SUVs, trucks and crossovers, and want safety systems and other features that are making vehicles heavier.
Meanwhile, very few consumers seem to want hybrids or electric cars. Despite the proliferation of models, they form less than 5 percent of U.S. auto sales combined.
Fuel economy has improved in the U.S. by about 14 percent, from about 22 mpg in 2010 to around 25 mpg in 2017, said Carla Bailo, president and CEO of the Center for Automotive Research. And they are improving still at about a pace of 1 mpg per year, more or less, she said.
But if you look at what consumers are actually buying, fuel economy has stagnated, said Michael Sivak, who runs the automotive consulting firm Sivak Applied Research.
This may change if companies continue to improve the efficiency of power trains.
These big trucks are essential for Detroit's Big Three automakers, Ford, GM and Fiat-Chrysler.
All three majors are expected to still control more than 80 percent of the U.S. market in pickup trucks, compared with only 39 percent of the SUV and crossover market, according to data from LMC Automotive.
"Ford makes really makes its money on the F-150 and then the Mustang," Kelley Blue Book analyst Rebecca Lindland told CNBC.
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803ed2f19e01793956d27a701693162b | https://www.cnbc.com/2018/05/21/bitcoin-could-be-another-failed-currency-robert-shiller-says.html | Bitcoin could be just another failed currency experiment, Nobel-winning economist Robert Shiller warns | Bitcoin could be just another failed currency experiment, Nobel-winning economist Robert Shiller warns
Robert ShillerRamin Talale | Bloomberg | Getty Images
Cryptocurrencies mirror some of the most famous failed currency experiments throughout history, according to Nobel-winning economist Robert Shiller.
Enthusiasm around the thousands of existing cryptocurrencies, including bitcoin, remains strong despite warnings from investors such as Warren Buffett that they're worthless. That mania and attempts to launch new units of money have existed in different forms since the 1800s, Shiller said.
Shiller, best known for warning about the housing and dot-com bubbles, pointed to the early 19th century, when merchants tried to replace the gold standard with "time money." The "Cincinnati Time Store" for example sold merchandise in units of work and closed just three years after it launched. One hundred years later during the Great Depression, economist John Pease Norton proposed a dollar by electricity, which also failed to catch on.
VIDEO1:5601:56Bitcoin craze is more psychological than economic: Nobel laureateTrading Nation
"Each of these monetary innovations has been coupled with a unique technological story," Shiller wrote in a blog post Monday. "But, more fundamentally, all are connected with a deep yearning for some kind of revolution in society."
Bitcoin and cryptocurrencies are no different, he said. They were introduced by a community of entrepreneurs who, as Shiller put it, "hold themselves above national governments, which are viewed as the drivers of a long train of inequality and war."
The mania around bitcoin today is also due in part to its mystery, the Yale University professor said.
"Practically no one, outside of computer science departments, can explain how cryptocurrencies work, and that mystery creates an aura of exclusivity, gives the new money glamour, and fills devotees with revolutionary zeal," Shiller said. "None of this is new, and, as with past monetary innovations, a seemingly compelling story may not be enough."
The height of the public's fascination was also undoubtedly tied to bitcoin's meteoric rise in price. The world's first cryptocurrency rose to near $20,000 last year before losing roughly half of its value in the first quarter of 2018.
Here is the full post by Shiller.
VIDEO2:2202:22Narratives drive human behavior, says Robert ShillerDavos - World Economic Forum
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a989e844ef0795061cb515f3ec00853c | https://www.cnbc.com/2018/05/21/carl-icahn-says-his-stake-in-vmware-is-sizable-worth-hundreds-of-millions.html | Carl Icahn says his stake in VMware worth 'hundreds of millions,' reveals he also owns Dell tracking stock DVMT | Carl Icahn says his stake in VMware worth 'hundreds of millions,' reveals he also owns Dell tracking stock DVMT
VIDEO6:3406:34When you're lucky you can't always confuse it with being smart: Carl IcahnHalftime Report
Carl Icahn revealed the size of his stake in VMware on Monday.
"I wish I had a bigger position than I have, but it's a sizable position. ... It's in the hundreds of millions of dollars, but it could be more but the stock just got away from me," he said Monday on CNBC's "." "I added to the position. I also bought the tracking stock [Dell Technologies Class V] too, which I don't think was mentioned."
CNBC reported in April that Icahn acquired a "medium-sized" stake in VMware, according to sources familiar with the matter. Dell is considering a reverse merger with VMware where it would also consolidate the tracking stock (ticker DVMT) as part of a deal. Dell said last week it was considering an exchange of its closely-held DHI shares for DVMT shares, which track the performance of VMware within Dell.
Icahn broached the prospect of facing off again with Dell's founder, Michael Dell.
"We're right there against Dell again, maybe," he said. "I say maybe because I hope he does the right thing and he pays a fair price for it."
Icahn publicly and unsuccessfully challenged Michael Dell in his 2013 effort to take Dell private. Michael Dell and Silver Lake ultimately acquired the company for $24.4 billion, a price tag Icahn said "greatly undervalues it."
Icahn's ownership of both the tracker stock and VMware suggests he is bullish on the prospect of a deal between Dell and VMware. Dell is currently seeking feedback from holders of the Class V shares about terms of a potential VMware deal that would satisfy investors, CNBC reported last week.
The billionaire investor is chairman of Icahn Enterprises. He often targets struggling companies as an activist to bring about changes to improve their businesses and boost their stock market values.
Disclaimer
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16337a151626dfa3a34377f73d9097cd | https://www.cnbc.com/2018/05/21/cnbc-transcript-treasury-secretary-steven-mnuchin-speaks-with-squawk-box-today.html | CNBC TRANSCRIPT: TREASURY SECRETARY STEVEN MNUCHIN SPEAKS WITH "SQUAWK BOX" TODAY | CNBC TRANSCRIPT: TREASURY SECRETARY STEVEN MNUCHIN SPEAKS WITH "SQUAWK BOX" TODAY
WHEN: Today, Monday, May 21, 2018
WHERE: CNBC'S "Squawk Box"
Following is the unofficial transcript of a CNBC interview with Treasury Secretary Steven Mnuchin today on CNBC's "Squawk Box" (M-F 6AM – 9AM) today, Monday, May 21st. Following is a link to video of the interview on CNBC.com: https://www.cnbc.com/video/2018/05/21/secretary-mnuchin-weve-made-meaningful-progress-on-china-trade-talks.html?play=1.
All references must be sourced to CNBC.
JOE KERNEN: JOINING US NOW FROM WASHINGTON, TREASURY SECRETARY STEVEN MNUCHIN. AND MR. SECRETARY, THANKS FOR JOINING US SO MUCH. IT'S GREAT TO SEE YOU. CAN YOU FILL IN -- GIVE US SOME COLOR ON JUST THE STATEMENT THAT "THE TRADE WAR HAS BEEN PUT ON HOLD"?
SECRETARY STEVEN MNUCHIN: WELL, GREAT. THANK YOU. IT'S GREAT TO BE HERE WITH YOU. I THINK WE MADE VERY MEANINGFUL PROGRESS OVER THE PAST FEW DAYS. I THINK YOU KNOW THIS WAS OUR THIRD SESSION OF INTENSE DISCUSSIONS AND NEGOTIATIONS. AND WE CAME AWAY WITH A VERY COMPREHENSIVE FRAMEWORK AGREEMENT THAT NEEDS TO BE IMPLEMENTED BUT HAS LOTS OF DIFFERENT ASPECTS. ONE ASPECT OF IT, WHICH HAS BEEN THE PRESIDENT'S FOCUS ON CUTTING THE TRADE DEFICIT AND THAT'S BY INCREASING EXPORTS SIGNIFICANTLY. BUT THERE'S MANY OTHER ASPECTS. WE TALKED ABOUT TECHNOLOGY TRANSFERS. WE TALKED ABOUT MARKET REFORMS. WE TALKED ABOUT THEM LOWERING TARIFFS, OPENING UP MARKETS TO U.S. COMPANIES. SO I THINK WE'VE MADE VERY MEANINGFUL PROGRESS. AND NOW IT'S UP TO BOTH OF US TO MAKE SURE THAT WE CAN IMPLEMENT IT.
KERNEN: THAT'S REALLY CLEAR AND – BUT WHEN I CAME IN, I EXPECTED TO SEE, "TRADE WAR PUT ON HOLD," AS THE LEAD STORY IN "THE WALL STREET JOURNAL." INSTEAD, IT WAS "U.S. SENDS MIXED MESSAGES ON CHINA: DIFFERING STATEMENTS FROM THE TREASURY CHIEF AND THE TRADE REPRESENTATIVE CLOUD NEXT STEPS." IS THAT A – DID THEY GET THE STORY WRONG OR IS THERE – IS IT, YOU KNOW, EASY TO SEE THAT THERE'S SOME DISAGREEMENT BETWEEN DIFFERENT PARTIES IN THE WHITE HOUSE?
MNUCHIN: I THINK THEY GOT THE STORY COMPLETELY WRONG. AMBASSADOR LIGHTHIZER, MYSELF, SECRETARY ROSS LED ALL OF THE MEETINGS. I PROBABLY SPOKE TO AMBASSADOR LIGHTHIZER AT LEAST TEN TIMES A DAY OUTSIDE OF IT. I LOOKED AT AMBASSADOR LIGHTHIZER'S STATEMENT BEFORE HE PUT IT OUT. IT'S COMPLETELY CONSISTENT WITH THE TEAMS APPROACH. SO BOB AND I AND WILBUR ARE ALL COMPLETELY ON THE SAME PAGE. WE WERE IN THE OVAL OFFICE ON FRIDAY FOR TWO HOURS BRIEFING THE PRESIDENT ON THE EXTENSIVE DISCUSSIONS. SO THE TEAM IS UNIFIED ON THIS.
KERNEN: THERE'S EVEN A QUOTE HERE, I WANT TO KNOW WHO THIS IS AND MAYBE YOU KNOW, "THERE IS," -- I'M QUOTING – "THERE'S A GROWING FRUSTRATION WITH SECRETARY MNUCHIN GETTING AHEAD OF BOTH THE PRESIDENT AND THE TRADE TEAM ON THE DIRECTION OF THE NEGOTIATIONS. HIS EAGERNESS TO DO A DEAL SIGNIFICANTLY UNDERCUTS THE U.S. NEGOTIATING POSITION." WHO DO YOU THINK -- YOU THINK THAT'S EITHER NAVARRO OR LIGHTHIZER OR SOMEONE THAT WORKS FOR THEM? WHO DO YOU THINK GAVE THE JOURNAL THAT QUOTE?
MNUCHIN: I'M NOT GOING TO SPECULATE. BUT YOU KNOW I'VE BEEN WORKING WITH THE PRESIDENT SINCE THE CAMPAIGN. THIS IS AN ENORMOUSLY IMPORTANT PART OF OUR ECONOMIC PROGRAM FROM DAY ONE. WE HAD TAX REFORM, REGULATORY RELIEF AND TRADE. PEOPLE DIDN'T THINK WE'D GET TAX REFORM DONE. WE DID. THERE'S BEEN PEOPLE WHO WERE CYNICAL THAT WE'D GET MEANINGFUL PROGRESS ON TRADE. WE'RE ACCOMPLISHING THAT. AND REGULATORY RELIEF, I SPOKE TO THE PRESIDENT AT LEAST FIVE TIMES OVER THE WEEKEND AND ON THURSDAY AND FRIDAY. AND HE'S PERSONALLY BEEN PART OF THESE DISCUSSIONS, AND PROVIDING SPECIFICS INCLUDING ON THE COMMUNIQUE.
ANDREW ROSS SORKIN: SECRETARY MNUCHIN.
BECKY QUICK: GO AHEAD.
SORKIN: SECRETARY MNUCHIN, I WANTED TO ASK YOU WHERE THIS LEAVES ZTE AND ALSO WHETHER YOU THINK ZTE IS A NATIONAL SECURITY THREAT?
MNUCHIN: SO, LET ME BE VERY SPECIFIC ON ZTE BECAUSE I ALSO THINK THE STORY HAS BEEN MISREPORTED. NOT A SURPRISE, PRESIDENT XI ASKED PRESIDENT TRUMP TO LOOK INTO ZTE. THAT'S NO DIFFERENT THAN PRESIDENT CALLS UP WORLD LEADERS ON BEHALF OF AMERICAN COMPANIES ALL OF THE TIME. THE PRESIDENT ASKED MYSELF AND COMMERCE SECRETARY TO LOOK ITO IT. HE DIDN'T DICTATE ANY TERMS, HE JUST ASKED US TO LOOK INTO IT. THE COMMERCE POSITION WAS AN ENFORCEMENT ISSUE. THE INTENT WAS NOT TO PUT THE COMPANY OUT OF BUSINESS. IT WAS AN ENFORCEMENT ISSUE. I THINK, YOU KNOW, I CHAIR CFIUS, I'M ON THE NATIONAL SECURITY COUNCIL. WE'RE REVIEWING SOME POSSIBLE CHANGES BY THE COMMERCE DEPARTMENT TO THE ENFORCEMENT. AND I ASSURE THAT YOU THEY WILL SUPPORT OUR NATIONAL SECURITY POSITION. SO I THINK THERE'S PLENTY OF PEOPLE WHO ARE TRYING TO MAKE THIS OUT TO BE SOMETHING IT IS NOT. THERE WAS NO QUID PRO QUO. THERE WERE DISCUSSIONS BUT THIS WAS A COMPLETELY SEPARATE ISSUE THAT THE PRESIDENT ASKED US TO LOOK INTO.
QUICK: SECRETARY MNUCHIN, LET ME JUST TRY TO PUT A FINER POINT ON THIS FOR THE MARKETS BECAUSE WE ARE LOOKING AT THE MARKETS INDICATED UP BY ABOUT 240 POINTS THE DOW TODAY. BASED ON THIS IDEA OF WHAT YOU SAID YESTERDAY THAT THE TRADE WAR IS ON HOLD. NOW, BEFORE EVERYBODY TAKES OFF AND HEAD FOR THE HILLS WITH THIS AND REALLY RUN THINGS UP, THAT IS NOT THE TRADE WAR IS OVER. YOU ARE SAYING THAT WE'VE MADE PROGRESS, BUT WE DON'T KNOW WHAT COMES NEXT. HOW WOULD YOU TELL PEOPLE TO LOOK AT THIS? GLASS HALF FULL OR GLASS HALF EMPTY? -- IF YOU ARE SOMEBODY WHO IS WATCHING THE MARKETS TODAY.
MNUCHIN: IT IS COMPLETELY HALF FULL. AND WHAT I WOULD JUST SAY, CHRIS WALLACE ASKED ME IF THE TRADE WAR WAS ON HOLD SO I RESPONDED. WHAT I WOULD HAVE REALLY SAID IS, "THIS HAS BEEN A TRADE DISPUTE ALL ALONG. IT NEVER WAS A TRADE WAR. IT'S A TRADE DISPUTE ON SIGNIFICANT ISSUES. BOTH PARTIES HAVE AGREED TO SUSPEND THE TARIFFS—OUR 150, THERE 50. YOU SAW IN SORGHUM, THEY DROPPED THE CASE ON FRIDAY AS A SIGN OF GOOD FAITH. FOR OUR FARMERS, THIS IS GOING TO BE FABULOUS RIGHT AWAY. SECRETARY ROSS IS GOING OVER THERE. THEY'VE COMMITTED TO 35 OR 40% INCREASES IN FARM PRODUCTS IMMEDIATELY. IN ENERGY, I THINK THIS IS A MASSIVE OPPORTUNITY FOR THE U.S. TO BECOME A MAJOR SUPPLIER OF ENERGY TO CHINA. THEY HAVE INCREDIBLE AMOUNTS OF DEMAND AT THESE PRICES FOR OUR SHALE AND OUR LIQUID NATURAL GAS THIS IS A GREAT OPPORTUNITY. ALASKA HAS SIGNED AN MOU, IT'S BEING TURNED INTO A BINDING COMMITMENT RIGHT AWAY FOR ABOUT $10 BILLION A YEAR FOR A VERY, VERY LONG-TERM. AS I'VE MENTIONED, I THINK WE CAN EASILY GET $40 BILLION OR $50 BILLION OF ENERGY AND IF WE CAN PRODUCE AND SEND MORE WITH INFRASTRUCTURE, THEY CAN EVEN TAKE MORE. SO THERE ARE A LOT OF OPPORTUNITIES. THIS IS VERY, VERY GOOD FOR OUR ECONOMY, FOR OUR FARMERS. AND WE'LL SEE. WE'VE GOT TO EXECUTE. AS I'VE COMMENTED, THIS IS NOT A GIANT PURCHASE ORDER GOVERNMENT TO GOVERNMENT. WE NOW HAVE TO EXECUTE ON THIS AND CHINA HAS TO EXECUTE ON THIS.
KERNEN: WE'VE GOT TO -- OBVIOUSLY IT'S GOING TO TAKE SOME -- WHAT'S IT? TRUST BUT VERIFICATION BECAUSE COUNTRIES DON'T – THEY GO -- IF IT WAS IN THEIR BEST INTEREST TO HAVE BEEN BUYING ENERGY FROM US, THEY WOULD HAVE BEEN DOING IT ALL ALONG, I WOULD THINK. RIGHT? I MEAN, IT'S MARKET FORCES THAT CAUSE PEOPLE TO DO THINGS. IS THERE -- ARE THERE GUARANTEES THAT IT'S GOING TO WORK OUT? IT DOESN'T SEEM LIKE ANY OF THIS IS BINDING. AND WE'RE JUST TAKING IT AT THEIR WORD THAT THEY'LL START BUYING MORE FROM US.
MNUCHIN: WELL, AS I COMMENTED ON, WE NOW HAVE TO TURN THESE INTO BINDING AGREEMENTS AND THOSE BINDING AGREEMENTS WILL BETWEEN COMPANIES. SO SECRETARY ROSS IS GOING OVER TO NEGOTIATE THE FRAMEWORK SO THAT COMPANIES CAN ENTER INTO LONG-TERM AGRICULTURE SALES, LONG-TERM ENERGY SALES AND THOSE BECOME. NOW, OF COURSE, AT THE END OF THE DAY, THIS HAS TO BE IN OUR INTEREST AND IN THEIR INTEREST. THEY DO HAVE A GROWING ECONOMY WITH A LOT OF DEMAND. THEY WANT TO DIVERSIFY AWAY THEIR ENERGY SOURCES. AT THESE PRICES, IT'S VERY GOOD FOR US. AND WE NEED TO BUILD THE INFRASTRUCTURE. SO I THINK AS YOU KNOW, ONE OF THE CONCERNS THEY HAD WAS ARE WE GOING TO BE ABLE TO DELIVER ALL THESE ADDITIONAL GOODS? AND WE'VE SAID WE BELIEVE THE U.S. ECONOMY AND U.S. COMPANIES CAN. SOME OF THESE THINGS CAN BE EXECUTED IMMEDIATELY. SOME OF THESE THINGS WILL REQUIRE LONG-TERM CONTRACTS TO DELIVER INTO. BUT THIS SHOULD BE VERY, VERY GOOD FOR U.S. ECONOMIC GROWTH. YOU COMBINE THIS WITH TAX CUTS AND I THINK WE'RE LOOKING AT VERY STRONG GDP GROWTH FOR THE REST OF THE YEAR.
KERNEN: WHEN THE FREE TRADERS WOULD GROWL ABOUT TARIFFS AND WHY ARE WE DOING THIS, A LOT OF DEFENDERS OF THE ACTION WOULD SAY, "LOOK. WE HAVE THE INTELLECTUAL PROPERTY AND THE THEFT OF INTELLECTUAL PROPERTY AND UNFAIR TECHNOLOGY GIVE AND TAKE BETWEEN CHINA AND THE UNITED STATES NEEDED TO BE ADDRESSED." TARIFFS ARE NOW GONE OR ON HOLD AND NONE OF THAT WAS ACTUALLY FIXED. SO -- OR WAS IT? IS THERE REASON FOR HOPE IN ALL THOSE OTHER AREAS, MR. SECRETARY?
MNUCHIN: THOSE ISSUES ARE PART OF OUR FRAMEWORK. THESE THINGS CAN'T BE FIXED OVERNIGHT. WE'VE HAD THREE MEETINGS. WE'RE GOING TO CONTINUE TO HAVE MEETINGS. AND IF THESE THINGS AREN'T FIXED, AND WE DON'T GET WHAT WE WANT, THE PRESIDENT CAN ALWAYS PUT TARIFFS BACK ON.
KERNEN: SO IT'S ON HOLD. SO IT'S LIKE A SWORD OF DAMOCLES – IT'S LIKE A SWORD OF DAMOCLES. THESE ARE STILL THERE. ON HOLD DOESN'T MEAN GONE. IT JUST MEANS WE'LL SEE THE BEHAVIOR.
MNUCHIN: EXACTLY, I WOULD USE THE WORD THEY'VE BEEN SUSPENDED. AND BY THE WAY, THIS IS THE SAME STRATEGY WE'VE USED ON SANCTIONS IN OTHER PARTS OF THE WORLD. SO THE PRESIDENT IS THE FIRST ONE WHO'S BEEN DETERMINED TO BE TOUGH ON TRADE AND CHANGE THESE DEALS. AND THE PRESIDENT IS A FREE TRADER BUT HE'S ALSO A FAIR TRADER, AND HE WANTS TO MAKE SURE THEIR MARKETS ARE OPEN TO US THE WAY OUR MARKETS ARE OPEN TO THEM.
SORKIN: MR. SECRETARY, I HAVE TWO OTHER TOPICS I WANTED TO TOUCH ON. ONE IS A REPORT THAT BROOKFIELD PROPERTIES, WHICH IS BACKED BY THE QATARI GOVERNMENT AND IS GOING TO BE INVESTING IN 666 5th AVENUE, WHICH OF COURSE IN OWNED BY KUSHNER COMPANIES. THE QUESTION IS, WILL THAT TRANSACTION GO THROUGH CFIUS AND IF SO, IS THAT A TRANSACTION YOU WOULD BE INVOLVED WITH OR WOULD YOU HAVE TO RECUSE YOURSELF?
MNUCHIN: AGAIN, AS IT RELATES TO CFIUS I CAN'T MAKE ANY SPECIFIC COMMENTS. BUT I WILL TELL YOU SO FAR I'VE READ ABOUT THAT IN THE PAPER AND AM NOT AWARE OF ANYTHING ELSE. BUT I'M NOT GOING TO MAKE ANY COMMENTS ON IT IN THE FUTURE ON CFIUS-SPECIFIC ACTIONS.
SORKIN: OKAY. AND THEN THE OTHER QUESTION I WANTED TO ASK YOU IS, IN THE WAKE OF THIS SCHOOL SHOOTING THIS FRIDAY AND THROUGHOUT THIS YEAR GIVEN SOME OF THE ISSUES THAT HAVE TAKEN PLACE, A NUMBER OF BIG BANKS HAVE DISTANCED THEMSELVES FROM GUN MANUFACTURERS ON THEIR OWN AND -- BUT THERE'S BEEN A BIT OF CONCERN THAT THERE'S GOING TO BE RETALIATION FROM DIFFERENT PARTS OF GOVERNMENT. AND SPECIFICALLY THERE WAS A REPORT THAT THE S.E.C. AND S.E.C. COMMISSIONERS HAVE MADE SOME COMMENTS TO SOME OF THE BANKS RETALIATING, IN TERMS OF REGULATIONS. HOW DO YOU OVERSEE THAT ISSUE GIVEN THAT YOU OVERSEE THE BANKS?
MNUCHIN: WELL FIRST OF ALL, LET ME JUST SAY: I WANT TO
EXPRESS MY CONDOLENCES FOR THE FAMILIES WHO WERE INVOLVED. IT OBVIOUSLY IS A VERY DIFFICULT ISSUE AND I KNOW SOMETHING THAT THE PRESIDENT IS FOCUSED ON. AS IT RELATES TO ANY SPECIFIC REGULATORY ISSUES, WE HAVEN'T REVIEWED THAT YET. AND IF THOSE BECOME IMPORTANT, WE WILL REVIEW THEM AT FSOC.
QUICK: MR. SECRETARY, BACK TO TRADE. WHAT CAN YOU TELL US ABOUT NAFTA AND WHERE THINGS STAND THERE? -- BECAUSE OBVIOUSLY THE MARKET IS BREATHING A SIGH OF RELIEF ABOUT THE SITUATION WITH CHINA. WHAT HAPPENS NEXT WITH NAFTA?
MNUCHIN: WELL I KNOW AMBASSADOR LIGHTHIZER HAS BEEN VERY FOCUSED ON NAFTA. AS HE SAID THERE'S STILL SOME VERY SIGNIFICANT OPEN ISSUES. I HAD A GOOD CONVERSATION WITH BOTH THE MEXICAN FINANCE MINISTER AND THE CANADIAN FINANCE MINISTER LAST WEEK. I THINK THERE IS A DESIRE ON ALL THREE PARTIES TO TRY TO GET THIS DEAL DONE. THE AMBASSADOR HAS DONE AN ENORMOUS AMOUNT OF WORK. WE'LL SEE WHERE WE GET OVER THE NEXT FEW WEEKS. THE PRESIDENT IS INVOLVED IN THESE DISCUSSIONS. I KNOW HE'S HAD CONVERSATIONS WITH TRUDEAU. SO WE'LL SEE WHERE WE GET. WE'RE STILL TRYING TO GET A NEW DEAL DONE. THAT IS A PRIORITY FOR THE PRESIDENT. BUT AS I'VE SAID, HE WANTS A GOOD DEAL AND THAT'S WHAT HE'S FOCUSED ON.
QUICK: WE HAD SENATOR BARRASSO ON WITH US FOR AN HOUR THIS MORNING. AND HE TALKED A LITTLE BIT ABOUT THAT HE HIMSELF WOULD LIKE TO SEE A DEAL THAT CONGRESS DOESN'T HAVE TO SIGN OFF ON. SOMETHING KIND OF AROUND THE EDGES – A NAFTA LIGHT, AS IT MIGHT BE. BECAUSE HE'S WORRIED ABOUT THE COMPLICATIONS OF ACTUALLY BEING ABLE TO GET IT THROUGH CONGRESS. WHAT ARE YOUR THOUGHTS ON THAT? MNUCHIN: WELL I'VE HEARD THAT IDEA AS A SKINNY DEAL. I THINK FOR RIGHT NOW WE'RE STILL FOCUSED ON A NEW NAFTA THAT WOULD GO THROUGH CONGRESS, BUT WE EASILY CAN LOOK AT THE SKINNY DEAL AS AN ALTERNATIVE AND THAT'S SOMETHING THE PRESIDENT CAN CONSIDER. AGAIN, FOR THE MOMENT, THE PRESIDENT IS FOCUSED ON HE WANTS TO GET BETWEEN THE THREE COUNTRIES AND THEN WE'LL FIGURE OUT HOW TO GET IT THROUGH CONGRESS.
KERNEN: MR. SECRETARY, CAN YOU GIVE US ANY COLOR ON THE REPORTED NAVARRO/MNUCHIN SMACKDOWN – SMACKDOWN THAT HAPPENED ON YOU. I DON'T KNOW IF YOU'RE ON RECORD COMMENTING ON THAT. WAS IT OVERPLAYED? WAS IT A DISAGREEMENT? AND WHERE DOES IT STAND RIGHT NOW?
MNUCHIN: PETER'S BEEN AN IMPORTANT PART OF THE TEAM. I'M NOT GOING TO COMMENT ON ANY OF THESE SPECIFICS. OBVIOUSLY RUMORS AND GOSSIP AND EVERYTHING ELSE IS GOOD FOR YOUR CABLE TV, BUT I'M NOT GOING TO MAKE ANY COMMENTS ON IT.
KERNEN: IS HE – AND HE'S PRESIDENT AT MANY OF THE WORKING GROUPS? ANY OF THE THINGS STILL GOING ON. MR. NAVARRO STILL A VALUED MEMBER OF THE TEAM. I THINK THE PRESIDENT LIKES TWO SIDES OF THINGS. AT LEAST BOTH SIDES WILL BE HIGHLIGHTED, RIGHT?
KERNEN: PETER PARTICIPATED IN THE OVAL OFFICE MEETING WITH THE VICE PREMIER AND MYSELF AND THE VICE PRESIDENT. ACTUALLY, IT WAS -- I THINK WE PROBABLY HAD ABOUT TEN PEOPLE IN THE OFFICE. THE PRESIDENT WANTED TO HAVE A LOT OF PEOPLE THERE. THE CHIEF WAS THERE. AMBASSADOR BOLDIN, THE VICE PRESIDENT, LARRY SO WE HAD A LOT OF PARTICIPATION. THIS TIME WE THOUGHT IN TERMS OF THE INTENSE NEGOTIATIONS, IT WOULD JUST BE LIMITED TO THE THREE OF US ON THE SIDE. BUT LET ME JUST TELL YOU, THE CHINA TEAM BROUGHT 70 PEOPLE WITH THEM. THEY ARE WORKING AROUND THE CLOCK, EVEN WHEN WE WENT HOME AT NIGHT. AND WE HAD PEOPLE FROM EVERY AGENCY THAT WE INVOLVED, EITHER ON THE PHONE OR IN THE TREASURY BUILDING AS WE WERE DOING THESE NEGOTIATIONS.
KERNEN: AS IS OUR HABIT WITH ALL TREASURY SECRETARIES, BUT MAYBE EVEN MORE WITH YOU, MR. SECRETARY, I GUESS WE'VE GOT TO TALK ABOUT THE DOLLAR A LITTLE. I DON'T WHERE I SAW IT -- I SAW IT THIS MORNING ON ONE OF THE FINANCIAL WEBSITES THAT THE DOLLAR BEING SO STRONG THREATENS A LOT OF OUR INITIATIVES AND IT ACTUALLY THREATENS THE STRONG ECONOMY RIGHT NOW. WOULD YOU PREFER A WEAKER DOLLAR AT THIS POINT?
MNUCHIN: LET ME BE VERY SPECIFIC ON MY DOLLAR COMMENTS, SO THESE ARE NOT MISINTERPRETED. LET ME BE CLEAR.
KERNEN: GO AHEAD.
MNUCHIN: THE DOLLAR IS THE MOST LIQUID TRADING MARKET IN THE WORLD. WE RESPECT THE FREE TRADING OF THE DOLLAR. IN THE LONG-TERM, A STRONG DOLLAR IS GOOD FOR THE UNITED STATES AND REFLECTS THE SUCCESS OF THE UNITED STATES BOTH IN THE ECONOMY, THE INVESTMENTS, AND EVERYTHING ELSE. I AM NOT GOING TO MAKE ANY COMMENTS ON WHERE THE DOLLAR IS RIGHT NOW OR SHORT-TERM TRADING OF THE DOLLAR.
KERNEN: ALL RIGHT BUT AS LONG AS YOU'RE HERE, I JUST GOT MORE QUESTIONS FOR YOU. BUT WE'RE GOING TO BE READY TO LET YOU GO IN A SECOND. BUT DO YOU THINK THE 3% GDP NUMBER FOR THE YEAR WILL GET CRACKED IN 2018 AND ARE YOU CONFIDENT THAT THAT WILL BE THE CASE?
MNUCHIN: IF I WERE BETTING I'D BET – I'D ABSOLUTELY TAKE THE OVER INSTEAD OF THE UNDER. I THINK WE ARE WELL ON OUR WAY TO 3% OR HIGHER SUSTAINED GROWTH AND THAT'S REALLY BEEN THE FOCUS. AND THAT'S WHAT EVERYBODY SHOULD BE FOCUSED ON. THAT'S OUR SCORE CARD. AND THE MARKETS REFLECT THAT, THE JOBS REPORT REFLECTS THAT, THE DIFFERENCE BETWEEN 2% AND 3%, TRILLIONS OF DOLLARS TO THE ECONOMY, ECONOMIC GROWTH, NATIONAL SECURITY, THOSE ARE THE PRESIDENT'S TWO MOST IMPORTANT PRIORITIES. I THINK, YOU KNOW, WE'RE BEING VERY AGGRESSIVE ON NATIONAL SECURITY USING SANCTIONS ALL OVER THE WORLD AND THE ECONOMIC PROGRAM IS REALLY PAYING OFF.
KERNEN: OKAY. WE HEAR NO ONE TALKS ABOUT THE STOCK MARKET ANYMORE. THAT'S WHAT WE'VE BEEN HEARING SINCE IT'S BEEN KIND OF FLAT SINCE FEBRUARY. BUT I DON'T KNOW HOW CLOSE YOU'RE FOLLOWING IT, BUT YOU MAY SEE A 25,000 PRINT ON THE DOW AGAIN TODAY.
MNUCHIN: I CAN ASSURE YOU, I FOLLOW IT STILL PRETTY CAREFULLY. I'VE ALWAYS SAID WHERE IT IS ON ANY ONE DAY, AGAIN, I'M NOT GOING TO COMMENT. I'M VERY BULLISH ON STOCKS. I THINK THAT REFLECTS A STRONG ECONOMY, WILL REFLECT A STRONGER STOCK MARKET. THERE'S OBVIOUSLY BEEN, YOU KNOW, VARIOUS DIFFERENT WORLD EVENTS AND THINGS THAT HAVE CREATED SOME VOLATILITY. BUT THE STOCK MARKET IS UP AN ENORMOUS AMOUNT SINCE THE ELECTION AND WITH ALL OF OUR ECONOMIC PLANS IN PLACE, I WOULDN'T BE SURPRISED TO SEE IT HIGHER BY THE END OF THE YEAR.
KERNEN: DID YOU SEE "60 MINUTES" LAST NIGHT, MR. SECRETARY?
MNUCHIN: I DID NOT.
KERNEN: OH, YOU DIDN'T. ALRIGHT. JUST WONDER—
QUICK: JOE'S JUST TAKING A POLL.
KERNEN: YEAH, I'M TAKING A POLL. IF YOU SAW IT WITH GOOGLE, IT WAS INTERESTING. THAT'S A HELL OF A COMPANY OBVIOUSLY. BUT -- AND WHEN YOU GET THAT GOOD AND HAVE THAT GREAT A MOAT, YOU WONDER IF IT'S A MONOPOLY OR NOT. I JUST WONDERED IF YOU VIEW IT AS A MONOLOPY – GOOGLE?
MNUCHIN: WELL, I WOULD JUST SAY THE ISSUE OF MONOPOLIES ARE OUT OF MY LANE. THAT IS WITHIN THE JUSTICE DEPARTMENT. BUT I THINK THESE ARE ISSUES THAT THE DEPARTMENT NEEDS TO LOOK AT SERIOUSLY. NOT FOR ANY ONE COMPANY BUT OBVIOUSLY, AS THESE TECHNOLOGY COMPANIES HAVE A GREATER AND GREATER IMPACT ON THE ECONOMY I THINK THAT YOU HAVE TO LOOK AT THE POWER THEY HAVE AND IT'S SOMETHING THAT THE JUSTICE DEPARTMENT I HOPE TAKES A SERIOUS LOOK AT, WITHOUT ME MAKING ANY COMMENTS AS TO WHETHER THEY SHOULD BE OR THEY SHOULDN'T BE, BUT THESE ISSUES DESERVE TO BE REVIEWED CAREFULLY.
KERNEN: YEAH. THEY'VE GOT A LOT ON THEIR PLATE I'M TOLD – THE JUSTICE DEPARTMENT. I DON'T KNOW WHAT I MEAN BY THAT. BUT THERE ARE A FEW THINGS HAPPENING OVER IN THAT AREA. MR. SECRETARY, THANKS AGAIN FOR ALL THE TIME YOU SO GRACIOUSLY GAVE US THIS MORNING. THANK YOU.
MNUCHIN: ALWAYS GOOD TO SEE YOU. THANK YOU.
For more information contact:
Jennifer Dauble CNBCt: 201.735.4721m: 201.615.2787e: jennifer.dauble@nbcuni.com
Emma Martin CNBCt: 201.735.4713m: 551.275.6221e: emma.martin@nbcuni.com
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349333277d551e42c7a58425bdfa5a44 | https://www.cnbc.com/2018/05/21/comcasts-xfinity-storefronts-are-reminiscent-of-apple-stores.html | Comcast's lush new storefronts are reminiscent of Apple Stores | Comcast's lush new storefronts are reminiscent of Apple Stores
Comcast launched a new interactive Xfinity retail store, created to provide customers an immersive destination to discover Xfinity products and services.Source: BusinessWire
Curl up with a cup of coffee and enjoy the free WiFi. Use a tablet computer to try out a mix of apps. Check out the latest big screen TV.
Those experiences have become familiar at the local Starbucks or some electronics stores like Best Buy or Apple. But there's a company offering those perks and more, one not generally thought of as a retailer.
It's Comcast.
Consumers may love to hate their cable companies, but Comcast is betting its new retail stores with giant video screens and comfy couches will help strengthen its connection to customers. There will be zones where they can try out products ranging from Comcast's X1 video player to smart locks controlled with the tap of an iPad.
Comcast plans to set up shop in malls and shopping centers, sometimes moving into spaces that more traditional chains have left empty after struggling with slipping sales.
Source: BusinessWire
The stores will be more akin to the sleek, interactive spaces pioneered by tech titan Apple, designed as much around experiencing gadgets as they are to selling them.
"We're opening . . . next to the Apples and Sephoras and Ultas ,'' Tom DeVito, Comcast's senior vice president of retail sales and service said. "We want to be where customers shop."
Comcast has already opened stores in Pueblo, Colo.; Aventura, Fla.; Henrico, Va.; Chattanooga, Tenn., and Tucson, Ariz. It plans to open more than 50 additional locations this year. It ultimately wants to have one of the storefronts within a 15 minute drive of every Comcast customer.
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The new Xfinity store format stands in stark contrast to the Internet and cable company's spartan service centers of old, where customers often had to travel to inconvenient office parks to pay a bill or return a faulty modem.
It's a smart move, says Neil Saunders, managing director of retail consultancy GlobalData.
"Customers spend a lot on cable and internet services, so being able to try out products and services in a high-quality environment is appreciated,'' Saunders says. " The days of getting away with a shabby service desk in a dimly lit unit have long since gone."
Comcast customers will be able to continue taking care of routine tasks like paying bills or swapping out equipment at the new stores. But they will also be able to try out Xfinity apps with various devices in different sections of the store.
Customers who subscribe to the internet service can check out a mobile offering that allows them to pay for data by the gigabyte if they choose. And in the store's "home zone,'' customers can use Xfinity's Home platform to flip on a light or review security camera footage with the click of a smartphone, tablet or TV remote control.
A TV monitor will simulate the customer being at home.
"From your smartphone, you can shut the light off on the display,'' says DeVito. "From an iPad, you can unlock the door. You can set the sensors in your garage, you can dim your light. We've created a set of interactive displays that simulate you being in your home so we can make the product come to life.''
DeVito added that "we think as customers come into our stores and learn how to fully use all the capabilities of our products... that will drive better retention, a better customer experience (and) more loyalty."
Disclosure: Comcast is parent of NBCUniversal and CNBC.
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f5cd34d305a03f3856e1f18c6d11cddf | https://www.cnbc.com/2018/05/21/cramer-ex-trump-advisor-gary-cohn-would-have-liked-us-china-framework.html | Cramer: I believe former Trump advisor Gary Cohn 'would've liked' this US-China trade framework | Cramer: I believe former Trump advisor Gary Cohn 'would've liked' this US-China trade framework
VIDEO1:4301:43Cramer: The market wants an end to anything 'trade'Squawk on the Street
The trade framework being negotiated between the United States and China would have been right up Gary Cohn's alley, CNBC Jim Cramer said Monday.
Cohn, who was director of President Donald Trump's National Economic Council before Larry Kudlow, "would've liked this deal very much, I believe," Cramer said on "Squawk on the Street."
Cohn was not immediately available to respond to CNBC's request for comment.
"There was a group within the White House, which Larry Kudlow was not apart of, that pushed out Gary Cohn," said Cramer, pointing out that Cohn, formerly the No. 2 executive at Goldman Sachs, was "widely viewed as a globalist."
Back in March, Trump picked the longtime economist and former CNBC commentator Kudlow to succeed Cohn.
Cohn resigned from the White House shortly after losing his fight to persuade the president not to impose import tariffs on steel and aluminum, an earlier move separate from the latest China tariffs over what the U.S. considers Chinese companies' theft of American intellectual property.
When Cohn resigned, Cramer had said at the time that it was a "big blow" to the market.
However, Cramer, host of "Mad Money," on Monday said the stock market had been experiencing a sort of relief rally because investors want an "end to anything trade."
And at the Wall Street open, the Dow Jones industrial average spiked higher — soaring about 350 points in early trading and eclipsing 25,000 for the first time since mid-March.
"It's great for the stock market," Cramer said. "It's saying there is a framework, so if there is a framework then there's not going to be a break off talks ... and they'll be something that comes out." But he added, "I just wish we could clarify exactly what we got."
In an interview with CNBC's "Squawk Box" on Monday, Treasury Secretary Steve Mnuchin said the Trump administration came away from trade talks with a "very comprehensive framework agreement that needs to be implemented." Mnuchin expressed enthusiasm regarding energy, estimating U.S. companies likely can sell $40 billion to $50 billion to Chinese firms.
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9d470830e1139a1770fadc5a045bf2af | https://www.cnbc.com/2018/05/21/cramer-this-trade-led-rally-makes-sense-just-look-at-retail-stocks.html | VIDEO1:0901:09Trade-led rally makes senseMad Money with Jim Cramer
As the major averages jumped on Monday on news that the United States and China reached a momentary truce in trade talks, CNBC's Jim Cramer wanted to verify the strength of the rally.
"While we often act like only the large-capitalization stocks like Caterpillar and Boeing ... are really in the crosshairs here, the truth is it's much, much bigger than that," the "Mad Money" host said on Monday. "So [...] let's talk about why this rally actually makes a lot of sense."
Cramer argued that in reality, China's influence over the U.S. economy largely hinges on what Chinese companies sell into the U.S. market.
"A full-blown trade war could make life very, very expensive for most Americans," he said.
As the Dow Jones industrial average crossed the 25,000 level for the first time since March, Cramer zoomed in on a group that reflected investors' relief over the temporary truce: retail.
Since the possibility of a trade war came into focus, retail stocks have been under pressure on worries that the goods they produce in China could become unsustainably expensive.
If Chinese authorities made it too costly to produce goods there, U.S. retailers could charge consumers for the difference, causing price inflation.
"We import so much cheap stuff from the People's Republic that the prospect of the Trump administration putting tariffs on those goods has made investors very worried," Cramer explained. "So when we heard about the truce, we immediately figured that the consumer is going to be spared the shock of those much higher prices."
That's what sparked a rally in department store stocks like Macy's, which hit a 52-week high on Monday as investors breathed a sigh of relief that, for now, prices would remain stable.
Cramer added that while most major apparel makers have the ability to move production to other countries, they wouldn't be able to do so overnight and prices would most likely rise in the interim.
"At a time when we're increasingly worried about inflation and how it might force the Fed to raise rates faster than we'd like, the last thing we needed were tariffs on retail goods," the "Mad Money" host said.
Shares of retailers that turn to China for swaths of their low-cost merchandise — Walmart, Dollar Tree and Dollar General, to name a few — also shared in Monday's gains.
"We can all breathe easier now that we've lost what could've been an immediate driver of inflation," Cramer concluded. "I've told you over and over again that it's trade, not the rising interest on the 10-year Treasury, that's been hurting stock prices, and the retail element was a huge part of that. Putting the trade war on hold creates a much more positive backdrop for everything."
VIDEO12:1812:18Cramer: This trade-led rally makes sense—just look at the retail sectorMad Money with Jim Cramer
Questions for Cramer? Call Cramer: 1-800-743-CNBCWant to take a deep dive into Cramer's world? Hit him up! Mad Money Twitter - Jim Cramer Twitter - Facebook - Instagram - VineQuestions, comments, suggestions for the "Mad Money" website? madcap@cnbc.com
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672bac81607123ef700d0f679f30242f | https://www.cnbc.com/2018/05/21/drax-pilots-project-that-could-result-in-carbon-negative-electricity.html | UK's largest power station pilots project that could result in 'carbon negative' electricity production | UK's largest power station pilots project that could result in 'carbon negative' electricity production
Anna Gowthorpe | PA Images | Getty Images
The U.K.'s largest power station is to pilot a program that could make its renewable electricity "carbon negative" — meaning that it takes out more carbon dioxide from the atmosphere than it creates.
Originally built as a coal-fired power station, Drax in North Yorkshire, England, has been focusing on renewables in recent years and this new bioenergy carbon capture storage (BECCS) project is claimed to be the first of its kind in Europe. The scheme will involve Drax partnering with C-Capture, a spin-out from the University of Leeds that designs solvent systems for the removal of carbon dioxide from gas streams. Drax will invest £400,000 ($536,706) in the project, according to a statement at the weekend. Located near Selby, 65 percent of the electricity Drax Power produced in 2017 was renewable. Three of the facility's six power generation units have been converted from burning coal to using compressed wood pellets sourced from "responsibly managed working forests." The average surface temperature of the planet has increased by around 1.1 degrees Celsius since the end of the 19th century, according to NASA. This change, NASA says, has been driven "largely by increased carbon dioxide and other human-made emissions into the atmosphere." "If the world is to achieve the targets agreed in Paris and pursue a cleaner future, negative emissions are a must — and BECCS is a leading technology to help achieve it," Will Gardiner, the Drax Group's CEO, said in a statement. Gardiner was referring to the landmark Paris Agreement, reached at the end of 2015. Under that agreement, world leaders committed to making sure global warming stayed "well below" 2 degrees Celsius above pre-industrial levels. They also agreed to pursue efforts to limit the temperature rise to 1.5 degrees Celsius. "This pilot is the U.K.'s first step, but it won't be the only one at Drax," Gardiner added. "We will soon have four operational biomass units, which provide us with a great opportunity to test different technologies that could allow Drax, the country and the world, to deliver negative emissions and start to reduce the amount of carbon dioxide in the atmosphere." The first step of the project will start later this month, and will determine if the solvent developed by C-Capture is compatible with the biomass flue gas at Drax Power Station. "We have developed fundamentally new chemistry to capture CO2 and have shown that it should be suitable for capturing the carbon produced from bioenergy processes," Chris Rayner, C-Capture's founder and professor of Organic Chemistry at the University of Leeds, said.
"The key part is now to move it from our own facilities and into the real world at Drax," Rayner added. "Through the pilot scheme we aim to demonstrate that the technology we've developed is a cost-effective way to achieve one of the holy grails of CO2 emissions strategies — negative emissions in power production, which is where we believe the potential CO2 emissions reductions are likely to be the greatest."
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a0c483f3b07badd0291436c4bc98abf7 | https://www.cnbc.com/2018/05/21/european-markets-trade-war-concerns-ease.html | Europe closes higher as trade war concerns ease; Italian stocks lower | Europe closes higher as trade war concerns ease; Italian stocks lower
French and U.K. stocks closed higher Monday with investors digesting weekend developments in U.S.-China trade talks.
The FTSE 100 closed provisionally up by 1 percent and the CAC 40 in Paris was higher by 0.4 percent. The former hit a fresh intraday record high Monday. Meanwhile, the main Italian index fell 1.5 percent on political news. German and other European markets were closed for a public holiday.
Market sentiment was driven by trade news and political events in Italy. Fears over a trade war between the U.S. and China eased after comments from U.S. Treasury Secretary Steven Mnuchin that both countries are putting the trade war "on hold" as they tried to reach a compromise. On Wall Street, stocks traded sharply higher amid the alleviation of trade tensions.
Political instability in Italy seems to be coming to an end with a power-sharing agreement between the left-wing Five Star Movement and the right-wing Lega. Both parties are due to present their deal to the country's president later on Monday. However, such a government could raise concerns across the euro zone due to planned higher spending. French Finance Minister Bruno Le Maire warned Sunday that Rome needs to respect European spending rules, according to the Financial Times.
In earnings, Ryanair reported a 10 percent increase in full-year profit after tax. The company reiterated Brexit concerns and reported a pessimistic outlook for 2019. The stock traded lower during early deals, but it rose more than 5 percent later in the day.
Altice was among the worst performers, down by more than 7 percent, after the MSCI deleted it from the global standard indexes, effective on May 22, Reuters reported.
There are no major data releases on Monday.
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fddd0b596d396dbbeb6c0c87a0f0018c | https://www.cnbc.com/2018/05/21/forex-markets-dollar-in-focus-after-rally-some-respite-for-euro.html | Dollar rally weakens as focus turns to Fed minutes | Dollar rally weakens as focus turns to Fed minutes
Dan Kitwood | Getty Images
The dollar retreated on Tuesday after six straight days of gains, as U.S. Treasury yields dipped and investors looked for fresh incentives to buy the currency in the wake of its nearly 7 percent rally since mid-February.
The dollar's recent uptrend has been supported by generally upbeat U.S. economic data that has kept the Federal Reserve on track to raise interest rates at least two more times this year. In contrast, other major central banks such as the Bank of Japan and European Central Bank are not in a tightening mode.
"The U.S. dollar may require a fresh dose of catalysts to sustain its nascent resurgence," said Mazen Issa, senior FX strategist at TD Securities in New York.
"Against a backdrop of higher rates, including the overly-emphasized 3 percent mark in U.S. 10-year yields and a very fully-priced Fed, the dollar may have exhausted the divergence narrative," he added.
The divergence referred to the difference in monetary policies between the Fed and other central banks, which has been a major prop for the dollar.
In late trading, the dollar index was down 0.11 percent at 93.57, after hitting a five-month high on Monday. The index, which measures the dollar against a basket of currencies, was on track for its largest daily loss in two weeks.
The dollar was supported on Monday on signs that the United States and China were making progress to resolve their trade conflict. On Tuesday, China said it would cut import tariffs for automobiles, opening greater access to the worlds largest auto market, in a further sign of easing trade tensions.
"U.S. Treasury yields pulled back from last week's seven-year highs, encouraging traders to cash in bullish dollar bets," said Gavin Friend, senior markets strategist at NAB in London.
U.S. 10-year yields still traded above 3 percent on Tuesday. Investors are now looking to the release on Wednesday of the Fed's minutes from its most recent meeting and analysts said there could be inflationary overtones.
James Chen, head of research at Forex.com in Bedminster, New Jersey, said a key level to watch on the dollar index amid the Fed's minutes is the 94.00 resistance level.
"Any hawkish interpretation of the minutes could prompt a breakout above that level, which could then open the way towards the 95.00 handle and above," Chen said.
"To the downside, any dovish interpretation could prompt a pullback towards the 92.50 support area once again," he added
In other currency pairs, the euro dipped 0.08 percent against the dollar to $1.178 amid political uncertainty in Italy.
The country's anti-establishment 5-Star Movement and the far-right League on Monday proposed Giuseppe Conte as prime minister to lead their coalition government.
The dollar, meanwhile, slipped 0.14 percent against the to 110.88 yen, after touching a four-month peak on Monday.
VIDEO4:2004:20Commodity conundrum: Gold sinks, oil soars as the dollar gainsTrading Nation
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f668568826845af47cd69aeb482abab1 | https://www.cnbc.com/2018/05/21/gold-prices-steady-on-weaker-dollar.html | Gold rebounds from 2018 low as dollar falls | Gold rebounds from 2018 low as dollar falls
AP
Gold edged up on Tuesday from a 2018 low, adding traction as the dollar fell off its five-month high, though risk appetite in the broader financial markets kept the precious metal's gains in check.
The dollar lost momentum following a broad rally prompted by rising U.S. bond yields and the prospect of a resolution to U.S.-China trade tensions. A weaker dollar makes dollar-priced gold cheaper for non-U.S. investors.
Spot gold had edged up 0.17 percent to $1,294.52 per ounce by 8:15 a.m. ET. In the previous session, it slid to $1,281.76, its lowest since Dec. 27.
U.S. gold futures for June delivery rose 0.21 percent to $1,293.60 per ounce.
Washington and Beijing both claimed victory on Monday as the world's two largest economies stepped back from the brink of a global trade war and agreed to hold further talks to boost U.S. exports to China.
"This quarter and maybe going into next, gold will continue to struggle but the (positive) views on the U.S. economy are overdone," said Philip Newman, director at Metals Focus. "There are concerns over sizeable U.S. debt, there's the (U.S.) mid-term elections in November, there's enough out there that could see the dollar eventually weaken and gold prices start to improve through the back end of this year."
VIDEO1:5201:52Kudlow: It's good that gold is soft and the dollar is strongSquawk on the Street
Capping gains in gold, European shares inched to a near four-month high as an easing of pressure on Italian markets coincided with China's latest move to open its giant economy to the rest of the world.
Gold, seen as a safe haven, tends to weaken when there is strong investor appetite for equities, seen as risky assets. "The overriding narrative here is where the dollar is going," said Stephen Innes, APAC trading head at OANDA. Abating geopolitical risk was also weighing on sentiment for gold, he added.
Meanwhile, expectations that the Federal Reserve will lift U.S. interest rates again next month added to downward pressure on gold. Higher U.S. rates tend to boost the dollar and push bond yields up, making non-yielding assets such as bullion less attractive.
"Somewhere around the $1,275 level we are going to start to attract more bullish sentiment, but in the meantime the driver is going to remain the U.S. dollar," Innes said.
Holdings in SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, fell 0.38 percent to 852.04 tons on Monday.
Silver rose 0.67 percent to $16.59 an ounce, while palladium rose 1.11 percent to $1,000.47 an ounce. Platinum climbed 1.09 percent to $905.74 an ounce, after marking a low for the year in the previous session at $873.50.
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2aa7c5cccd9f103f74526cc47688c348 | https://www.cnbc.com/2018/05/21/goldman-as-hedge-funds-step-up-performance-heres-how-theyre-doing-it.html | As hedge funds step up performance, stocks such as Microsoft and these others are helping them do it | As hedge funds step up performance, stocks such as Microsoft and these others are helping them do it
VIDEO0:5400:54Find out the stocks with the highest hedge fund ownershipHalftime Report
Hedge funds not only are beating the market this year, but they're also doing it without much shuffling in their holdings.
For years, the industry has been the financial markets' version of the gang that couldn't shoot straight, posting years of underperformance during which investors would have been better off holding plain-vanilla index funds instead of taking the risks that hedge funds imply.
However, 2018 has been kinder.
Multiple trackers of industry performance show outperformance when compared with the S&P 500 and Russell 3000, particularly when it comes to closely held stocks.
Goldman Sachs tracks 848 funds that hold $2.3 trillion in assets — the industry in total has nearly 9,800 funds and $3.2 trillion in assets, according to HFR — and found managers' fairly long-standing market bets have been paying off.
In fact, the most popular stocks have outperformed the S&P 500 by nearly a full percentage point — a 3.5 percent gain compared with the index's 2.6 percent rise through May 16.
Mark Zuckerberg, Facebook CEOJustin Sullivan | Getty Images
Morever, a group of 20 stocks with the largest share of their market capitalization held by hedge funds has outperformed by nearly 2 percentage points. Funds overall have averaged a 2 percent gain for the year.
As for individual stocks, there were some interesting trends.
First and foremost, there's been little shifting of stocks in and out — what is referred to among managers as "turnover" — as the biggest bets are providing the best returns.
While Facebook remains the most popular stock for managers, it also increased its popularity more than any other name during the first quarter.
Goldman strategist Ben Snider said the growth in popularity came "with hedge funds viewing the stock's volatility as a buying opportunity." Indeed, despite a torrent of negative headlines, Facebook shares are up 4.4 percent year to date, nearly double the S&P 500's performance though considerably below the more than 10 percent jump in the technology sector.
Other most popular adds were Microsoft, Aetna, Monsanto and XL Group. Stocks that saw the biggest decline in hedge fund ownership included Amazon, Apple, McDonald's, Citigroup and Schlumberger.
Hedge fund ownership has turned highly concentrated, with an average 68 percent in holdings coming from the top 10 positions. The record is 69 percent set in the first half of 2016.
Turnover has been restrained, with just 13 new stocks entering a basket of the 50 most-held positions that Goldman tracks.
Managers also have been busy covering short positions, as the most-shorted stocks have been outperformers. Snider said energy stocks with the biggest bets again them have surged 30 percent since the start of the second quarter.
VIDEO1:0101:01Hedge funds pile into Facebook, sell Apple sharesNews Videos
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fbe14e4b1c060e75cef1742bb9b4b370 | https://www.cnbc.com/2018/05/21/malaysia-sets-up-new-1mdb-criminal-taskforce.html | Malaysia sets up new 1MDB criminal taskforce | Malaysia sets up new 1MDB criminal taskforce
Manan Vatsyayana | AFP | Getty Images
Malaysia has set up a special taskforce that will look into possible criminal conduct of individuals involved in the management of state fund 1Malaysia Development Berhad (1MDB), the prime minister's office said on Monday.
The taskforce, which will include the anti-graft agency, police and the central bank, will also be responsible for identifying and seizing assets acquired using funds allegedly siphoned from the state fund, which was set up in 2009 by embattled former prime minister Najib Razak, whose near 10-year rule ended in electoral defeat on May 9.
"This taskforce will also be responsible for seeking cooperation of various enforcement agencies in the United States, Switzerland, Singapore, Canada and other related countries," the office of new Prime Minister Mahathir Mohamad said in a statement.
VIDEO5:4405:44What happened to Malaysia's 1MDB money?CNBC Explains
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38795ab22391c12e9ff575a5c0a5bde2 | https://www.cnbc.com/2018/05/21/nipah-virus-contracted-from-fruit-bats-kills-nine-in-india.html | Deadly virus identified as a potential epidemic kills nine in India | Deadly virus identified as a potential epidemic kills nine in India
Arterra / Getty Images
A deadly virus described by the World Health Organization (WHO) as having the potential of becoming the next deadly major outbreak has killed nine people in the southern Indian state of Kerala.
State health officials confirmed that three people had contracted the Nipah virus within the past fortnight. The first death was reported to government officials on Saturday.
The Nipah virus claimed the life of a nursing assistant Monday who had treated a patient who had died of the disease, according to local media.
Chief minister of Kerala, Shri Pinarayi Vijayan, said Monday that India's government is closely monitoring the spread of the virus.
"Health department is doing everything possible to save the lives of the infected & prevent the advance of virus," said Vijayan in a statement on Twitter.
"Private hospitals have been instructed to not deny treatment for anyone suffering from fever."
A spokesperson for the WHO was not immediately available for comment when contacted by CNBC.
Nipah can be transmitted from animals to humans and human-to-human contact. The disease can emerge from fruit bats and infect domesticated animals such as pigs.
The first recorded outbreak was in Malaysia in 1998 with over 600 cases of nipah documented since.
Cases were recorded in Bangladesh in 2004 when infected date palm sap contaminated by fruit bats had been consumed.
Drowsiness, mental confusion and respiratory problems are some symptoms of the nipah virus.
There is currently no vaccine for the disease.
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e603f872ec407ca0f4ee96d6d0f11efd | https://www.cnbc.com/2018/05/21/pompeo-strikes-parallels-between-north-korea-and-iran-in-speech.html | Pompeo strikes parallels between North Korea and Iran during his first speech since becoming America’s top diplomat | Pompeo strikes parallels between North Korea and Iran during his first speech since becoming America’s top diplomat
U.S. Secretary of State Mike Pompeo makes his first public address at the Heritage Foundation in Washington, DC on May 21, 2018.Amanda Macias/CNBC
Secretary of State Mike Pompeo drew parallels Monday between the Iran nuclear deal and the one the U.S. hopes to craft with North Korea next month.
In his first public address since becoming America's top diplomat, Pompeo described the growing ballistic missile and nuclear weapons threats of rogue regimes like Tehran and Pyongyang.
He went on to defend President Donald Trump's decision to withdraw from the Iran nuclear deal and lauded the upcoming talks between the U.S. and North Korea in Singapore.
"Our willingness to meet with Kim Jong Un underscores the Trump administration's commitment to diplomacy and helps solve the greatest challenges even with our staunchest adversaries," Pompeo said during his opening remarks at the conservative Heritage Foundation. "That willingness has been accompanied by a painful pressure campaign and reflects our commitment to resolve this challenge forever."
Pompeo, who spoke for a little over half an hour before departing to assist in the swearing-in ceremony of his CIA successor, Gina Haspel, said the U.S. would impose the "strongest sanctions in history" on Iran for its malign activities.
VIDEO0:4700:47Pompeo vows US won't allow Iran to develop a nuclear weaponNews Videos
"Thanks to our colleagues at the Department of Treasury, sanctions are going back in full effect and new ones are coming," he said. "The sting of sanctions will be painful if the regime does not change its course from the unacceptable and unproductive path it has chosen to one that rejoins the league of nations."
He implied that a similar move may be likely if the U.S. does not strike a deal with North Korea.
Some observers say Trump's decision to leave the agreement with Tehran could undermine nuclear negotiations with Pyongyang.
DJ Peterson, president of Longview Global Advisors, a geopolitical and economic risk advisory group to corporations, investors and political organizations, said the U.S. lost credibility by walking out on the Iran deal.
"[North Korea] doesn't necessarily distinguish between the Obama administration and the Trump administration; that was just a deal with America. That was a deal with the White House," he said.
North Korean leader Kim Jong-un guides a target-striking contest of the special operation forces of the Korean People's Army to occupy islands in Pyongyang on Aug. 25, 2017.KCNA | Reuters
Retired U.S. Army Lt. Col. Daniel Davis, a senior defense fellow for Defense Priorities, echoed those sentiments, saying that scrapping one deal on nukes will impact the next deal the U.S. tries to make.
"It would be hard to even come up with a plausible reason why North Korean leader Kim Jong Un would be willing to negotiate in good faith and come up with a deal after this," Davis said.
As it stands, North Korea remains the only nation to test nuclear weapons this century.
Since 2011, Kim has fired more than 90 missiles and conducted four nuclear weapons tests, more than his father, Kim Jong Il, and grandfather, Kim Il Sung, launched over a period of 27 years.
The North's arsenal includes short- and medium-range ballistic missiles, intercontinental ballistic missiles and cruise missiles. The Hwasong-15 intercontinental ballistic missile is the most powerful rocket the North has tested to date.
The missile, also known as KN-22 by the U.S., is believed to have a range capable of hitting the entire continental United States, according to estimates from the Missile Defense Project.
Kim spent much of last year perfecting his arsenal by launching 24 missiles and carrying out North Korea's largest nuclear test.
VIDEO1:0601:06Secretary of State Pompeo heading back from North Korea with 3 released prisonersNews Videos
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7c05d52ae3f88a90147bad486e82aee1 | https://www.cnbc.com/2018/05/21/reuters-america-roper-technologies-to-buy-software-firm-powerplan-for-1-point-1-bln.html | Roper Technologies to buy software firm PowerPlan for $1.1 bln | Roper Technologies to buy software firm PowerPlan for $1.1 bln
May 21 (Reuters) - IT services provider Roper Technologies Inc said on Monday it would buy software company PowerPlan for $1.1 billion in an all-cash deal.
Roper Technologies said the transaction is expected to close in the second quarter, subject to regulatory approval. (Reporting by Vibhuti Sharma in Bengaluru; Editing by Arun Koyyur)
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254f4c485066ba242b259bddf0083188 | https://www.cnbc.com/2018/05/21/roche-drug-dramatically-reduces-bleeds-in-key-hemophilia-tests.html | Roche drug dramatically reduces bleeding in key hemophilia tests | Roche drug dramatically reduces bleeding in key hemophilia tests
A logo of the Swiss pharmaceuticals giant Roche.Fabrice Coffrini | AFP | Getty Images
Roche's new hemophilia drug Hemlibra dramatically reduced bleeding in a broad population of hemophilia patients, results from two clinical trials showed on Monday, setting it up to take a dominant market position.
Hemlibra cut by 96 percent the incidence of treated bleeds in hemophilia A patients who did not get preventive treatment and compared with patients who did get preventive treatment in the form of clotting factors it reduced them by 68 percent.
The positive results from the two trials known as HAVEN 3 and 4 included so-called non-inhibitor patients. Hemlibra's initial success was in patients with inhibitors, which are antibodies that cause resistance to replacement clotting factors.
Hemlibra's current regulatory approval is only for these inhibitor patients but Roche plans to submit the latest findings to authorities around the world to widen its use.
While the drug's latest success had been expected, the positive results seen in a wide range of patients should underpin demand for a medicine that Roche is relying on as several of its blockbuster cancer drugs face cut-price rivals.
Jefferies analysts said HAVEN 4 also showed there was a potential to treat both inhibitor and non-inhibitor patients on only a once-monthly basis. Currently, Hemlibra is given as a once-weekly injection.
"This sets Hemlibra up to become the new standard of care for hemophilia A, which we view as a $5 billion peak sales opportunity," they said.
The current standard of care for people with hemophilia A without inhibitors is replacement factor VIII clotting factor.
Hemlibra will shake up the market and pose a threat to established players reliant on factor replacement therapies, notably Shire, which has agreed to be acquired by Takeda Pharmaceutical.
Also being challenged are Bayer, CSL, and Novo Nordisk, as well as Sanofi, which earlier this year bought U.S. hemophilia specialist Bioverativ.
New science also promises to bring further changes in the years ahead, with several companies working on hemophilia gene therapy, in which a harmless virus is used to introduce DNA to fix the faulty genes behind the disease, offering a possible one-off cure.
Data from the two Roche clinical studies were presented at the World Federation of Hemophilia congress in Glasgow, Scotland.
"With this data, we now have positive results from all four of our Phase III trials that reinforce the overall efficacy and safety of Hemlibra and its potential to improve care for all people with hemophilia A," said Roche Chief Medical Officer Sandra Horning.
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665d7700d044b62d52fc80b38315e6e4 | https://www.cnbc.com/2018/05/21/tesla-shares-to-soar-on-strong-model-3-profitability-analyst.html | Tesla shares to soar more than 80% on strong Model 3 profitability: Analyst | Tesla shares to soar more than 80% on strong Model 3 profitability: Analyst
VIDEO0:5900:59Tesla shares to soar more than 80%: AnalystNews Videos
The hand-wringing over Tesla's ability to generate profits on the Model 3 is overblown, according to Berenberg.
The firm raised its price target for Tesla, predicting the electric car maker will be able to meet its 25 percent gross profit margin forecast for the Model 3. Berenberg also reiterated its buy rating for the stock.
"Model 3 gross margin to positively surprise," analyst Alexander Haissl said in a note to clients Friday. "The widespread assumption that Model 3 margins can be directly inferred from Model S/X is inherently and almost totally flawed. Substantial gains from lower labour content, as well as capital and material use efficiencies, should allow Tesla to comfortably achieve a margin above 25% throughout the product cycle."
VIDEO2:2402:24Why Tesla's Model 3 production pause is a big deal: Loup's Gene MunsterClosing Bell
The analyst raised his price target for Tesla shares to $500 from $470, representing 81 percent upside to Friday's close. Tesla shares rose 2 percent in premarket trading Monday.
Haissl said the Model 3 has significantly lower material costs versus the Model S since it uses a less-expensive electric motor and takes away features such as an air suspension and aluminum body. He also estimates the labor content is about $1,000 per car for the Model 3 versus more than $4,000 for the Model S due to "higher levels of automation and lower in-sourced content."
The analyst played down recent fears that Tesla will move away from a more modernized manufacturing process.
"We think reports that Tesla is reversing its automated manufacturing strategy over-exaggerated the real changes to the production system," he wrote. "We expect Tesla to remain the battery technology leader, as traditional OEMs have shown little effort to commit meaningful capital into battery technology."
Tesla's shares are down 11.1 percent year to date through Friday compared with the S&P 500's 1.5 percent return. The company's stock rose 2.8 percent Monday.
— CNBC's Michael Bloom contributed to this story.
Disclaimer
VIDEO5:3105:31Tesla's earnings were better than expected, but Elon Musk still has a lot on his plateDigital Original
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a764f868739fa3632c08b579e45be213 | https://www.cnbc.com/2018/05/21/thai-protesters-march-in-bangkok-to-demand-elections.html | Thai protesters prepare to march in Bangkok to demand an election | Thai protesters prepare to march in Bangkok to demand an election
Scores of Thai police ringed a Bangkok university early May 22 as protesters prepared to march to Government House to mark four years of junta rule, one of the largest acts of dissent since the military grabbed power.LILLIAN SUWANRUMPHA/AFP/Getty Images
Anti-government protesters began marching in Bangkok on Tuesday from a university in the Thai capital to Government House to demand that the military government hold a general election by November.
Government House and surrounding streets have been declared a no-go zone by police for the opposition march marking four years since a May 22, 2014, coup and have warned protesters not to defy a junta ban on public gatherings.
Police set up barriers along some roads near the university and carried out security checks on Tuesday.
More than 100 demonstrators walked in a line behind a truck with loudspeakers as police looked on, according to Reuters reporters at the scene.
One of the protest organisers, Sirawith Seritiwat, also known as Ja New, said protesters planned to march peacefully. "I hope they will let us walk out. We have no intention to prolong today's activities. I think they will try to stop us ... we will not use violence," Sirawith told Reuters.
Police said around 200 protesters had gathered. "Authorities will use the law 100 percent. If they walk out we will use the law immediately. We have put forces all around Government House ... if they come in to these areas there will be a prison sentence of up to 6 months," deputy national police chief Srivara Ransibrahmanakul told reporters.
"Police have no weapons. They are carrying only batons," he said.
Activists complained of a military crackdown ahead of the gathering. On Monday, Sunai Phasuk, Thai researcher at the New York-based Human Rights Watch group, said two activists had been held incommunicado at a secret detention centre.
"Their alleged 'crime' is providing loud speakers for anti-junta rally," Sunai wrote on Twitter. They were later released.
The junta, known as the National Council for Peace and Order, is facing a public perception crisis, according to international and domestic polls that say corruption is as endemic as ever.
The government has also repeatedly delayed the general election, which was first tentatively set for 2015, with the latest date now February 2019. Some fear the date could be pushed back again.
Protests against military rule have taken place intermittently in Bangkok since the start of the year. Some of them have been led by young activists. Others have been attended by former "red shirts", or supporters of ousted former prime minister Thaksin Shinawatra, who was toppled in 2006 and fled abroad.
His sister, Yingluck Shinawatra, was ousted in the 2014 coup and also fled abroad before being convicted of corruption in absentia.
Thailand has been rocked by pro- and anti-government street protests for more than a decade, some of them deadly. The military says it carried out the latest coup in 2014 to end the cycle of violence and street protests.
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cd2b43e4abbf527dabd3b37176f43c2f | https://www.cnbc.com/2018/05/21/trump-advisor-peter-navarro-reportedly-floated-informant-stefan-halper-for-a-job.html | Trump trade advisor Navarro reportedly floated suspected FBI informant for an administration job | Trump trade advisor Navarro reportedly floated suspected FBI informant for an administration job
Peter Navarro, director of the National Trade Council.Andrew Harrer | Bloomberg | Getty Images
Peter Navarro, one of President Donald Trump's top trade advisors, recommended a man identified by some news outlets as an FBI informant for a top Trump administration job, Axios reported Monday.
Navarro floated Stefan Halper's name for unidentified ambassadorships in Asia, according to the news outlet. Navarro, a harsh critic of China, knew Halper, an academic with a focus on China, from his previous research.
CNBC and NBC News have not independently confirmed reporting in multiple new outlets identifying Halper as an FBI informant. Still, the headlines come at an inopportune time for Navarro, who already is embroiled in workplace controversy after clashing with Treasury Secretary Steven Mnuchin over trade talks with China.
The report will do little to help the trade advisor with Trump, who has raged on Twitter about finding out whether the FBI and Justice Department monitored his campaign. On Monday, the Justice Department asked its internal watchdog to expand an investigation into the methods used to investigate the Trump campaign.
A White House spokeswoman did not immediately respond to a request to comment on the Axos report.
Read the full Axios report here.
VIDEO1:2901:29Conflicting reports about Navarro's role in China talksClosing Bell
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3f958d7737f4fb55bcf54e05486a57ee | https://www.cnbc.com/2018/05/21/us-department-of-justice-says-it-will-pursue-investigations-related-to-malaysias-1mdb.html | Malaysia's embattled former leader Najib questioned by anti-corruption agency | Malaysia's embattled former leader Najib questioned by anti-corruption agency
Malaysian activists hold message posters during arrest ' Malaysia Officials 1' rally near the independent square on August 27, 2016 in Kuala Lumpur, Malaysia.Chris Jung | NurPhoto | Getty Images
Embattled former Prime Minister Najib Razak arrived at the headquarters of Malaysia's anti-corruption commission on Tuesday, which has ordered him to explain a suspicious transfer of $10.6 million into his bank account.
The sum is just a fraction of billions of dollars allegedly siphoned from state fund 1MDB, a scandal that dogged the last three years of Najib's near-decade-long rule and was one of the main reasons why voters dumped him in an election on May 9.
That shock election result upended Malaysia's political order, as it was the first defeat for a coalition that had governed the Southeast Asian nation since its independence from colonial rule in 1957.
Malaysia's new leader, Mahathir Mohamad, who at the age of 92 came out of political retirement and joined the opposition to topple his former protege, has reopened investigations into 1Malaysia Development Berhad (1MDB) and has vowed to recover money that disappeared from the fund.
Since losing power, Najib and his allegedly shopaholic wife, Rosmah Mansor, have suffered a series of humiliations, starting with a ban on them leaving the country, and then police searching their home and other properties.
Flanked by security guards, Najib entered the Malaysian Anti-Corruption Commission (MACC) headquarters in Kuala Lumpur on Tuesday, moving slowly through a throng of journalists outside the building. Wearing an open-neck shirt, Najib looked relaxed and smiled once he entered the building's atrium.
Najib has consistently denied any wrongdoing since the 1MDB scandal erupted in 2015, but he replaced an attorney-general and several MACC officers to shut down an initial investigation.
Najib has said $681 million of funds deposited in his personal bank account were a donation from a Saudi royal, rebutting reports that the funds came from 1MDB.
The initial focus of the MACC's new probe is on how 42 million ringgit ($10.6 million) went from SRC International to Najib's account.
SRC was created in 2011 by Najib's government to pursue overseas investments in energy resources, and was a unit of 1MDB until it was moved to the finance ministry in 2012.
MACC has been able to track the money trail from SRC more easily because transactions were made through Malaysian entities, whereas most other transfers of 1MDB funds went through foreign banks and companies.
To investigate 1MDB, the new government on Monday set up a task force made up of members of the anti-graft agency, police and the central bank, to liaise with "enforcement agencies in the United States, Switzerland, Singapore, Canada and other related countries".
The U.S Department of Justice said on Tuesday it would continue to pursue investigations into 1MDB and looked forward to working with Malaysian law enforcement authorities.
"The Department of Justice is committed to ensuring that the United States and its financial system are not threatened by corrupt individuals and kleptocrats who seek to hide their ill-gotten wealth," a DoJ spokesperson said in an email statement to Reuters.
"Whenever possible, recovered assets will be used to benefit the people harmed by these acts of corruption and abuse of office," the statement added.
The U.S. filed forfeiture complaints in 2016 and 2017 seeking to recover over $1.7 billion in assets traceable to funds allegedly misappropriated from 1MDB.
These complaints alleged that more than $4.5 billion was diverted from 1MDB and laundered through a web of shell companies and bank accounts located in the United States and elsewhere.
VIDEO5:4405:44What happened to Malaysia's 1MDB money?CNBC Explains
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57cef1d4aa3f9b3da0d5f85fae05f074 | https://www.cnbc.com/2018/05/21/us-treasurys-mixed-as-investors-await-key-auctions.html | US Treasury yields little changed after last week's climb | US Treasury yields little changed after last week's climb
U.S. government debt yields ticked higher Monday following a sharp increase last week, when both the 10-year Treasury note yield and two-year Treasury note yield notched multiyear highs.
Bond traders are also awaiting the latest iteration of the Federal Reserve's monthly meeting minutes, scheduled for release Wednesday.
The yield on the benchmark 10-year Treasury note, which moves inversely to price, was slightly higher at 3.076 percent, up roughly 10 basis points over the past week, though off its multiyear highs clinched Friday.
The 10-year yield briefly hit 3.128 percent on Friday, its highest level since July 8, 2011 when the note yielded as high as 3.184 percent.
The yield on the 30-year Treasury bond was also higher at 3.21 percent on Monday, though off its own highs from last week.
With little economic data expected on Monday or Tuesday, fixed income investors are awaiting the Federal Reserve's latest meeting minutes, due out on Wednesday.
The minutes offer Wall Street an idea of how the central bank is thinking about the strength of the economy, with many expecting that the Federal Open Market Committee will raise rates in June to stay ahead of creeping inflation.
Minutes from their previous meeting showed that "all participants" expected both the economy to strengthen and inflation to rise "in coming months," citing strong spending patterns and a consistently tight labor market.
Treasurys
Consumer prices as measured by the personal consumption expenditures price index — the Fed's preferred inflation gauge — jumped 2 percent year-on-year in March, the biggest gain since February 2017.
The rising prices appear to be rising in part thanks to a competitive labor market, with the Labor Department reporting that the unemployment rate fell to 3.9 percent in April, the lowest level since December 2000.
Tighter labor markets are usually considered a bellwether of labor input wages in classical economics: When workers are in higher demand, employers will typically have to pay more for their services. Wages, in turn, are often seen as a prelude to higher prices throughout the economy as people spend more as their paychecks grow.
Rising inflation, which threatens Treasury prices because it erodes the purchasing power of their fixed payments, puts upward pressure on rates.
Later in the week, the Treasury Department is expected to auction $33 billion in two-year notes, $36 billion in five-year notes and $30 billion in seven-year notes.
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87fd9ac4826fed9cc271b03739cd569c | https://www.cnbc.com/2018/05/21/watch-cnbcs-steve-liesman-host-the-2018-national-economics-challenge.html | Watch CNBC's Steve Liesman host the 2018 National Economics Challenge | Watch CNBC's Steve Liesman host the 2018 National Economics Challenge
The finalists from the Council for Economic Education's National Economics Challenge on Monday will put their economics and problem-solving skills to the test in the nation's only high school economics competition.
Each year, 11,000 student participants from across the country compete for the opportunity to participate in the finals held annually in New York City. The competition recognizes exceptional high school students for their knowledge of economic principles and their ability to apply critical-thinking skills to real-world events.
In today's competition, four U.S. high school teams square off against each other. And four teams from China will compete to see who advances to the international round against the U.S. teams.
Here are today's teams:
USA David Ricardo Division:
Hunter College High School, New YorkMonta Vista High School, California
USA Adam Smith Division:
Lexington High School, MassachusettsMount Hebron High School, Maryland
China David Ricardo Division:
Shanghai Pinghe SchoolShenzhen Foreign Language School, Team # 3
China Adam Smith Division:
WHBC of Wuhan Foreign Langauge School, Team # 1Shanghai High School International Division
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ac4346aab0189afe2fe9938659219ec8 | https://www.cnbc.com/2018/05/21/why-rising-gas-prices-wont-last-after-trump-ends-iran-nuclear-deal.html | Why rising gas prices won't last, even after Trump ends Iran nuclear deal | Why rising gas prices won't last, even after Trump ends Iran nuclear deal
A sign displaying the price of gasoline per gallon is seen at a Mobil gas station in Miami.Getty Images
Oil prices jumped after President Trump scuttled the Iranian nuclear deal, pushing gas prices higher. Will pump prices pummel your driving budget this summer — and thereafter?
My research says no. Oil's budget-bashing potential went the way of the eight-track. Recent price wiggles won't last. Why?
Americans routinely fear higher oil. Memories of disco-era oil shocks, gas lines and stagflation loom large, passed on as lore from my generation to our kids. Back then, the Middle East dominated oil, given OPEC's embargo pricing power.
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But those days are dead.
Iran isn't really crucial now. It produces about 4.5 million barrels of oil a day, exporting just 2.5 million barrels. U.S. crude production is now 10.5 million barrels a day and should reach 11.9 million barrels next year.
Saudi Arabia has promised to help some, too. We and they more than offset the 1 million barrels-a-day reduction in Iranian exports officials expect from the return of sanctions. But realistically, Iran will export as much as before. As detailed in my April 15 column, single-country sanctions never bite. Companies work around them, diverting shipments through third parties for a minor brokerage commission mark-up. The only real change is altered shipping routes. Iran sells most of its oil to China, which is unaffected by these sanctions.
To see how trivial Iran is for oil, note 2012 to 2016, when Western sanctions blocked Iranian oil exports to America and Europe. Oil prices plunged from more than $100 a barrel to $26 in January 2016. Perversely, in 2016, when Iran restarted exporting to Europe, prices rose. But other forces were dominating the market by then.
Which ones? The U.S. technology revolution in oil shale, hydraulic fracturing (aka fracking), horizontal drilling and more. When those Iranian sanctions took full effect in July 2012, America produced just 6.3 million barrels a day of crude. By 2016 we were at 9.2 million barrels a day — a bigger increase than Iran's total exports. That surge helps explain global production's jump from 76 million barrels a day to 81.5 million in the same period, creating a global glut.
In February 2016, with oil prices low, producers started cutting back because their profits were smaller. They mothballed rigs and slashed investment in new wells. Meanwhile, OPEC and Russia mostly stuck to their much-ballyhooed output cuts. Slower-growing supply and healthy global demand helped oil prices bounce back up.
But that shift has gone too far, and the new trends driving the oil market are eye-popping. U.S. production rose in 2017. This year, new exploration rigs are operating 100%. Extraction technology keeps improving, cutting costs. Some oil fields are now profitable below $40 a barrel. Pumping at today's $70 price produces premium profits. Capacity will gush. As this technology evolves, it starts rippling overseas, goosing output and capping crude prices.
Still, don't expect gasoline prices to get too low. They're less variable than oil. Depending on the state, taxes are between 10.7% (Alabama) and 25.5% (Pennsylvania) of the per gallon price of regular gas. The average is about 16%, or 53.7 cents a gallon. Those taxes remain stable despite oil's gyrations.
Another factor is supply bottlenecks — especially in West Texas, where pipelines to Gulf Coast refiners are backing up. It will be tough to provide dirt-cheap gas everywhere without expanding capacity. Another irony: These regional bottlenecks create incentives for producers to drill more in North Dakota and Oklahoma, where similar bottlenecks in 2012 inspired pipeline bonanzas. Even more oil production will come there.
Even so, gas prices should be OK for your 2018 vacation budget. The U.S. has the world's greatest natural geography and low-cost vacation destinations. So enjoy them while Goldilocks reigns over our economy (see my May 6 column on that topic) and tune out the geopolitical noise. If you've never driven to Yellowstone, you really do owe it to yourself and your family.
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865db8395ff51b70057675821c21c9ed | https://www.cnbc.com/2018/05/21/ziprecruiter.html | ZipRecruiter | ZipRecruiter
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71046571db9fe002af098fe3866bd22e | https://www.cnbc.com/2018/05/22/airbus-moves-to-comply-with-wto-ruling-on-aircraft-subsidies.html | Airbus moves to comply with WTO ruling on aircraft subsidies | Airbus moves to comply with WTO ruling on aircraft subsidies
Airbus A380 performs an aerial demonstration over the Le Bourget Airport during the 52nd International Paris Air Show on June 22, 2017, in Paris, France.Yuriko Nakao | Getty Images
Airbus said on Tuesday it had taken steps to comply with a World Trade Organization (WTO) ruling on subsidies for its A350 and A380 jets, which has seen the United States and Europe trade legal blows on behalf of Boeing and Airbus.
The move comes after the United States won the right to seek sanctions against European Union goods following a partial victory in its 14-year legal battle against European government support for Airbus at the WTO.
The EU says it expects to strike a similar legal blow in a parallel case on U.S. support for Boeing later this year.
"Airbus and the European member states France, Germany, Spain and the U.K. have agreed on some amendments to A380 and A350XWB Reimbursable Launch Investment (RLI) loans," Airbus said in a statement.
"The terms of these amendments - like the terms of the original RLI contracts themselves - remain confidential but they are aligned with current market conditions," it added.
Airbus shares slipped 0.4 percent, slightly underperforming the broader Paris market.
The subsidies row coincides with transatlantic tensions over U.S. aluminium and steel tariffs, and the impact on European firms from Washington's decision to exit an Iran nuclear pact.
It is also part of a two-way battle between the EU and the United States over aircraft subsidies that could spark tit-for-tat reprisals between the two trade superpowers.
In a rare public face-off between senior strategists in the dispute, Boeing's chief external lawyer in the case told the BBC that the United States would be free to target any European products, not just aerospace.
VIDEO0:5500:55Airbus’ ‘flying taxi’ takes to the skies for the first timeDigital Original
"The WTO will decide what the proper number is and .. give the U.S. that authority," Robert Novick, co-managing partner at U.S. law firm WilmerHale, told the BBC Today programme.
"In parallel, the U.S. will develop a list of products on which it might consider imposing counter-measures," he added.
The transatlantic dispute stems from mutual claims that the world's two largest planemakers benefited from illegal aid in the form of subsidized government loans to Airbus and research grants or tax breaks to Boeing.
Underscoring the cost and complexity of the case, the two sides have been arguing since 2011 about whether they complied with earlier rulings.
Airbus did not say how it would comply with the final ruling on European aid but a European Commission document said it would repay an A350 loan to the UK government this year and reduce the drawdown of other loans.
It also said the bankruptcy of Russian carrier Transaero, resulting in fewer A380 deliveries, had helped it to comply, while other aid had been blunted by the passage of time - an argument that has previously been rejected by Washington.
Karl Hennessee, senior vice president and head of litigation at Airbus, told BBC Today that Airbus wanted a peace settlement similar to one between Canada and Brazil that set the tone for global aircraft export financing.
Nevertheless, Boeing has appeared to rebuff the offer.
"The most important message that Europe and Airbus can send to the rest of the world about the rules of trade in civil aircraft is to comply with this decision," Novick told the BBC.
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82669ffad7a7113ffd2f9f9f821d4dd1 | https://www.cnbc.com/2018/05/22/bill-gates-is-betting-on-this-synthetic-biology-start-up.html?platform=hootsuite | Why Bill Gates is betting on a start-up that prints synthetic DNA | Why Bill Gates is betting on a start-up that prints synthetic DNA
Synthetic biology involves reconfiguring the genome of an organism to get it to do something entirely new. Here, engineered E. coli colonies express GFP (green fluorescent protein), a protein originally found in jellyfish.Ginkgo Bioworks
In 2014, Ginkgo Bioworks entered Y Combinator as the first biotech company ever accepted by the famed accelerator. Four years later the Boston-based synthetic biology start-up, founded by a team of MIT scientists in 2009, has raised $429 million, including from Cascade Investment, the asset management firm of Bill Gates, and is reportedly worth $1 billion.
Over the last several years, Ginkgo has developed an automated process for combining genetic parts that has made it the largest designer of printed DNA in the world. That breakthrough has positioned the start-up to change the face of a variety of industries and helped to earn it the No. 21 spot on the 2018 CNBC Disruptor 50 list.
Last October, Ginkgo entered into a $100 million partnership with the global health-care and agriculture giant Bayer to engineer microbes capable of producing fertilizer for crops, like corn, wheat and rice.
"We're really building the platform that lets you design organisms," said CEO Jason Kelly, who studied chemical engineering at MIT.
Meet the 2018 CNBC Disruptor 50 companies
How we chose the 2018 CNBC Disruptor 50 innovators
A look back at the CNBC Disruptor 50: 6 years, 167 companies
Essentially, synthetic biology involves reconfiguring the genome of an organism to get it to do something entirely new. Kelly likens it to computer programming, only with genetic sequences. So think of DNA as computer code, and then imagine you can design sequences of DNA on the computer, physically print out those sequences, and insert them into microorganisms such as yeast and bacteria so they make products like rose-scented oil for perfume or sweeteners for beverages.
"We're learning how to rewrite the code of life," said Frances Arnold, a professor of chemical engineering, bioengineering, and biochemistry at the California Institute of Technology. "We're seeing a move toward making things that either chemistry cannot make or can't make efficiently but biology does."
The idea of modifying the DNA of organisms precedes the moniker of synthetic biology by many years. Genetic modification dates back to the 1980s, and genetic engineering for biofuels in the agricultural, pharmaceutical and energy industry has been common practice for some time. Think of Monsanto's Bt corn, which uses a modified bacteria to protect crops from damaging insects, and you have the idea. Such work has normally been the purview of highly trained scientists, but companies like Ginkgo are catching fire now, thanks to a confluence of factors.
"We can read DNA and write DNA very cheaply now. We can synthesize DNA in ways we couldn't just five years ago," Arnold said.
Senior automation engineer optimizing automated lab protocol on colony picker.
Last December, Ginkgo opened Bioworks3, its third laboratory space. It also closed a $275 million funding round, money that will go toward financing a fourth lab space set to open later this year.
At Ginkgo's labs the difficult work of synthetic biology is conducted through computer software and run by robotics. This is the platform idea that animates Kelly's company: By figuring out a standardized way to combine genetic parts, the same process can be applied across a number of industries to produce goods at fractions of their current costs or to create entirely new products.
"That's the core idea we have: DNA is code, and you can read and write it in these factories and test how it works," Kelly said. "So you're going to go to your computer, specify the exact sequence you want, print it, put the DNA into a tube or into an organism and test how it works."
That's why Bayer chose to partner with Ginkgo. The artificial fertilizers commonly used across the United States are produced by sucking in atmospheric nitrogen gas, which plants can't use, into chemical plants that then convert the gas into a solid form plants can use. But nitrogen fertilizer products from chemical plants are notorious for releasing tons of carbon into the atmosphere.
"Agriculture has exploded because we've been able to provide synthetic nitrogen fertilizers. What a lot of people are looking for today is a more sustainable long-term approach," said Mike Miille, CEO of Joyn Bio, the joint venture Bayer and Ginkgo formed last fall.
Crops like soybeans and peanuts have microbes in their roots that perform the same reaction that chemical plants do — such crops, in other words, produce their own fertilizer. Corn, wheat and rice, however, do not. Joyn Bio plans to use the genetic engineering expertise Ginkgo has developed to modify the microbes of such plants so that they, too, can pull nitrogen gas from the air and convert it into fertilizer.
There are thousands of companies trying to create agricultural breakthroughs, and one or more of these ideas could be huge one day.Mark ConnellyStephens analyst who covers fertilizer companies
Joyn Bio plans to develop other disruptive agriculture tech, still unspecified, over time, but nitrogen fixation is its first target for a reason. Hundreds of millions of tons of fertilizer flow into the global agricultural market each year, generating sales of nitrogen fertilizer worth billions of dollars to the biggest companies, such as Nutrien and CF Industries.
The global fertilizer companies are acting as if their dominance will continue. Stephens analyst Mark Connelly said the major fertilizer companies continue to focus major capital expenditures, in the billions, on building traditional fertilizer plants, an indication they don't see a need to invest in heavily in potential disruptive technologies. The total global fertilizer market is expected to reach as high as $250 billion in the coming years, though potash-based fertilizers are also a significant component of supply in addition to nitrogen-based soil nutrients.
It's not entirely new to attempt to disrupt the nitrogen supply chain in agriculture. Monsanto, for example, created a venture with Evogene in 2007 to create a nitrogen gene technology that would increase crop yields. It never came to market.
More from CNBC Disruptor 50:The current tech bubble is bigger than the one in 2000How 23andMe founder Anne Wojcicki is leading a DNA revolutionOscar Health has a vision of fairer pay for doctors and clearer pricing for patients
"In general, agricultural applications appear to be serving as testing grounds for many genetic engineering companies for whom the human market is years away," said John Prendergass, an associate director at Ben Franklin Technology Partners in Philadelphia. "Given lower regulatory barriers and potential for early revenue generation, partnerships like this make a lot of sense."
Connelly said these microbial start-ups that are working on ag replacement products, such as microbes rather than fertilizer to fix nitrogen, are a huge area of interest and activity. "There are thousands of companies trying to create agricultural breakthroughs, and one or more of these ideas could be huge one day, but it is also currently a huge space. It's the Wild West right now, but there will be some real prizes in there," he said.
Bayer's $100 million investment in Ginkgo is "a lot of money," Connelly said. "It is basically giving them the mezzanine financing now so they won't be forced to buy this start-up from a PE company in five years."
Synthetic biology is also being extended to consumer goods, like foods, fragrances and clothing. As a result, companies like Ginkgo are becoming increasingly attractive bets for investors. From 2012 to 2016, investment in synthetic biology start-ups increased from $374 million to $1.2 billion, according to data from CB Insights.
"Investors love platforms, and DNA is the ultimate platform," Prendergass said.
What remains challenging is generating profits, and that's a direct result of how tricky the concept of synthetic biology is. Composing sequences of genetic parts that effectively produce a new drug or can enable the microbes of the corn plant to produce its own fertilizer are complex problems.
"Inside of a living cell there are thousands of proteins that enable it to make more of itself and make your malaria drug, for instance. We don't understand those. We don't understand how they work together," Arnold said.
That's a challenge that Ginkgo Bioworks is tackling head-on in 2018. In addition to the money the start-up raised last year, it also acquired Gen9, a Boston company that prints DNA. Buying the company enabled Ginkgo to begin printing sequences of DNA very cheaply, Kelly said. Ginkgo has been building up what Kelly called a "code library of usable genetic code."
Again, think of it like software: When a programmer begins writing an app for the iPhone, they don't start that project from scratch. There are programming languages already available. The same is true for the synthetic biology projects of tomorrow, Kelly said.
"As the cost comes down, this technology can apply to other areas," Kelly said. "The whole idea behind Ginkgo is that it's the same kind of work regardless of what you're engineering."
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751b891c8db3462ae893215198d7903d | https://www.cnbc.com/2018/05/22/cnbc-unveils-sixth-annual-cnbc-disruptor-50.html | CNBC UNVEILS SIXTH ANNUAL CNBC DISRUPTOR 50 | CNBC UNVEILS SIXTH ANNUAL CNBC DISRUPTOR 50
Throughout the Week, CNBC Spotlights the 50 Companies that Collectively Have the Potential to Upend Multibillion-Dollar Industries
ENGLEWOOD CLIFFS, N.J., May 22, 2018−CNBC, First in Business Worldwide, today announced the sixth annual CNBC Disruptor 50, a ranked list of the most ambitious and innovative companies representing breakthrough ideas from all over the world. This year saw a record number of nominations across every sector of the economy with 981 companies vying for a spot on the CNBC Disruptor 50 list.
CNBC revealed the list across the network's platforms and is featuring special coverage throughout Business Day programming and on CNBC Digital this week. CNBC's Julia Boorstin will lead the network's on-air coverage reporting live from multiple locations around Silicon Valley. Additionally, CNBC will have unprecedented access to the number one Disruptor, SpaceX. CNBC's Morgan Brennan will get an exclusive look inside the aerospace company and speak with President and Chief Operating Officer, Gwynne Shotwell, which will air today, Tuesday, May 22nd, throughout CNBC's Business Day programming.
CNBC.com's special report, CNBC.com/Disruptors, features in-depth profiles of the 50 companies, an explanation of how CNBC chose and ranked the companies on the list and a robust line-up of stories exploring how today's business decision makers and investors can capitalize on disruptive technology trends. CNBC will also track each company's progress throughout the coming year when many of the companies on the list are expected to celebrate initial public offerings.
This year's Disruptor 50 companies have the potential to upend multibillion-dollar industries. Combined, they have raised more than $78 billion in venture capital at an implied valuation of more than $350 billion, according to PitchBook. And, 32 of this year's Disruptor 50 companies have valuations of $1 billion or more. The companies that made the final cut share a common goal of developing revolutionary new technology into lucrative business models to create the next generation of great public companies.
Following are the top ten 2018 CNBC Disruptor 50 companies:
1. SpaceX
2. Uber
3. Airbnb
4. Didi Chuxing
5. Lyft
6. Grab
7. 23andMe
8. Udacity
9. Rent the Runway
10. Coinbase
For more information regarding the CNBC Disruptor 50, including the full list, interviews, in-depth analysis and original digital video, visit CNBC.com/Disruptors.
Follow @CNBCDisruptors on Twitter, and join the conversation using hashtag #Disruptor50.
The CNBC Disruptor 50 was selected by CNBC and CNBC.com editorial staff using a proprietary blend of quantitative and qualitative information submitted by the 981 nominated companies. Disruptor 50 data partners PitchBook and IBISWorld provided additional quantitative input. CNBC's Disruptor 50 Advisory Council, a group of 52 leading thinkers in the field of innovation and entrepreneurship, weighted the quantitative criteria and provided additional analysis of qualitative information.
About CNBC:
With CNBC in the U.S., CNBC in Asia Pacific, CNBC in Europe, Middle East and Africa, and CNBC World, CNBC is the recognized world leader in business news and provides real-time financial market coverage and business information to more than 409 million homes worldwide, including more than 91 million households in the United States and Canada. CNBC also provides daily business updates to 400 million households across China. The network's 15 live hours a day of business programming in North America (weekdays from 4:00 a.m. - 7:00 p.m. ET) is produced at CNBC's global headquarters in Englewood Cliffs, N.J., and includes reports from CNBC News bureaus worldwide. CNBC at night features a mix of new reality programming, CNBC's highly successful series produced exclusively for CNBC and a number of distinctive in-house documentaries.
CNBC Digital delivers more than 52 million multi-platform unique visitors each month. CNBC.com provides real-time financial market news and information to CNBC's investor audience. CNBC Make It is a digital destination focused on making you smarter about how you earn, save and spend your money by zeroing in on careers, leadership, entrepreneurship and personal finance.
CNBC has a vast portfolio of digital products across a variety of platforms including: CNBC.com; CNBC PRO, the premium, integrated desktop/mobile service that provides live access to CNBC programming, exclusive video content and global market data and analysis; a suite of CNBC mobile products including the CNBC Apps for iOS, Android and Windows devices; and additional products such as the CNBC App for the Apple Watch and Apple TV.
Members of the media can receive more information about CNBC and its programming on the NBCUniversal Media Village Web site at http://www.nbcumv.com/programming/cnbc.
For more information about NBCUniversal, please visit http://www.NBCUniversal.com.
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e8460f1c2b32e35054b8cbc2fc462515 | https://www.cnbc.com/2018/05/22/cooperman-says-fang-stock-valuations-are-reasonable-except-for-amazon.html | Billionaire investor Cooperman says FANG stock valuations are 'reasonable' except for Amazon | Billionaire investor Cooperman says FANG stock valuations are 'reasonable' except for Amazon
VIDEO4:2504:25I'm hoping the government is pro-business and more rational: Lee CoopermanHalftime Report
Leon Cooperman, chairman and CEO of Omega Advisors, shared his market views Tuesday on CNBC's "Halftime Report."
"A lot of these FANG stocks with the exception of Amazon support very very reasonable valuations relative to their growth rates," he said. "The biggest concern I have frankly is government intervention. The government looking at their success and dominance and sticking their beak into their business."
FANG stocks are a basket of high-growth technology stocks — , , and (formerly known as Google) that have led the bull run of the last 9 years.
Leon Cooperman on CNBC's "Halftime Report."Scott Mlyn | CNBC
The investor confirmed his firm was long Facebook shares and said he had an open order to buy more of the social media company's stock at the $180 per share level.
He said Facebook can grow its earnings at 20 percent per year and trades around a 20 times this year's earnings versus the S&P 500's 5 percent growth and 17 times earnings.
Facebook has "a fortress balance sheet. It doesn't look expensive to me," he said.
The investor also recommended AMC Networks.
Cooperman founded Omega Advisors in 1991. The firm has approximately $3.4 billion in assets under management, according to its website.
Disclaimer
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7448a92895ce9ebbbd6f5a3ac8a425e5 | https://www.cnbc.com/2018/05/22/cramer-remix-if-we-see-another-pullback-buy-oil-stocks.html | VIDEO1:0101:01Cramer Remix: If we see another pullback, buy this sectorMad Money with Jim Cramer
After U.S. crude oil prices hit a three-and-a-half-year high on Tuesday, CNBC's Jim Cramer drilled down on why investors should've seen it coming.
The "Mad Money" host pointed to an April conference call at oil giant Schlumberger led by its CEO, Paal Kibsgaard. On the call, Kibsgaard said that supply and demand were in balance, but that global crude stocks were still below the five-year average.
The CEO argued that these data signaled that oil prices could move higher soon, which led to the surge higher that occurred in early May, Cramer said, adding that prices could still climb.
"Look, without significant new exploration the price of oil will keep drifting higher," Cramer said. "So if you get any sort of pullback like we got late this afternoon, I recommend using it to build up some oil exposure."
His recommendations? "Maybe a major like Chevron or an independent like Pioneer Natural [Resources] or perhaps the most obvious of them all, the stock of the man who predicted it all, Paal Kibsgaard's Schlumberger," the "Mad Money" host said.
The patriot missile is manufactured at Raytheon's Integrated Air Defense Center in Andover, Mass.John Tlumacki | The Boston Globe | Getty Images
On tepid trading sessions that come after big market surges, Cramer likes to search for under-performing stocks of companies that still have strong underlying businesses.
"Most people prefer to chase what's hot in the hope that they can get in on the next big thing, not before it's happened, but while it's happening," he said on Tuesday.
"But the problem with hot stocks is that you're often late to the party," he continued. "The better approach? Find cold stocks of once-hot companies that could ignite again — that way you could potentially enjoy the whole run. In other words, find broken stocks of intact companies."
Cramer dubbed the recent action in shares of e-commerce giant Amazon "the quintessential example" of a once-downtrodden stock that bounced back to generate real returns. He also tapped the stock of Raytheon as a current broken-stock opportunity.
Jennifer Hyman, CEO and co-founder, Rent the RunwayScott Mlyn | CNBC
Rent the Runway may be a private company, but co-founder and CEO Jennifer Hyman told CNBC that people could benefit from viewing her retail disruptor like they view stocks.
"People should think about their closets like they think about a stock portfolio," Hyman told Cramer on Tuesday. "There are things you want to invest in, you make those investments and those are your blue chips. So you should invest in a great pair of jeans, in a great cashmere sweater. You should have things that are higher quality that last."
"But for everything else, you should just have that on rotation and have the ability to take risks and constantly have newness and variety," she continued. "And that's a subscription [to Rent the Runway]."
For more on Hyman's interview and Rent the Runway's place on CNBC's Disruptor 50 list, click here.
Lance Fritz, CEO, Union PacificScott Mlyn | CNBC
With U.S. Treasury Secretary Steven Mnuchin admitting on CNBC that there are still some "significant" issues hindering a new NAFTA deal, CEOs like Union Pacific's Lance Fritz are concerned.
"I am worried about NAFTA just overall," Fritz told Cramer on Tuesday. "What concerns me right now is there seems to be this idea that we've got to race to a deal, and if we can't get it done soon, we're going to have to pause for a while. And that strikes me as an unhealthy place to be."
Fritz, whose railroad company operates in Canada, Mexico and much of the Western United States, said that he has spoken to members of the Trump administration regarding NAFTA.
For more on Fritz's outlook on the trade deal, click here.
Micron CEO Sanjay MehrotraScott Mlyn | CNBC
A recurring theme with Micron, one of the cheapest stocks in the S&P 500, is the market's concern around the supply-demand patterns of its top products, dynamic random-access memory and flash chips.
A host of investors and analysts view them as commodities subject to vicious boom-bust cycles that can erode demand quickly and create a supply glut.
But if you ask Micron President and CEO Sanjay Mehrotra, that thesis is unraveling with each iteration of products.
"When you look at the technology complexity, it's increasing," Mehrotra told Cramer in a Tuesday interview. "Each successive generation of new technology that is deployed into production is actually giving you less supply growth capability on a per-waiver basis."
The result is more market stability and growth for Micron's flagship products, the CEO said, adding that the fundamentals for flash chips are "healthy."
To watch Mehrotra's interview, click here.
In Cramer's lightning round, he rattled off his take on callers' favorite stocks:
Beacon Roofing Supply: "They missed the quarter. A lot of these companies missed their quarter. Can they come back? Yes. Would I sell them now? I don't know. I mean, the problem is that Toll Brothers reported a pretty good quarter and everybody hated it. Anything housing right now is going down, so I want to be careful."
Sprint Corporation: "I think T-Mobile has much more upside at $57. I think T-Mobile is the one you want to own, not Sprint."
Disclosure: Cramer's charitable trust owns shares of Schlumberger, Amazon and Raytheon.
Questions for Cramer? Call Cramer: 1-800-743-CNBCWant to take a deep dive into Cramer's world? Hit him up! Mad Money Twitter - Jim Cramer Twitter - Facebook - Instagram - VineQuestions, comments, suggestions for the "Mad Money" website? madcap@cnbc.com
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693ffefeb360b4974e590f6d79679037 | https://www.cnbc.com/2018/05/22/cramers-lightning-round-accounting-issues-at-flex-mean-sell.html | Flex: "You know, there were some problems with that last Flex quarter. There were some accounting issues and I can't recommend any stock that has accounting issues because accounting issues and irregularities equal sell."
Altria Group: "It's got this competitor that we call Juul and it's hurting. The whole industry is being roiled by this and that's why I can no longer recommend any of the tobacco companies. You have to read the Philip Morris quarterly conference call to know how bad things really have gotten."
Corning Inc.: "I don't like optical fiber, but that's just me remembering the old days, so I'm going to have to say no to that one."
Beacon Roofing Supply: "They missed the quarter. A lot of these companies missed their quarter. Can they come back? Yes. Would I sell them now? I don't know. I mean, the problem is that Toll Brothers reported a pretty good quarter and everybody hated it. Anything housing right now is going down, so I want to be careful."
Verint Systems: "This is one of these companies that does surveillance, basically, [and] digital video, and I like that industry. I'm OK with it."
Sprint Corporation: "I think T-Mobile has much more upside at $57. I think T-Mobile is the one you want to own, not Sprint."
Opko Health: "Ever since they bought BioReference Lab, it's just been a disaster. And I don't know what to say. I mean, it shouldn't be. I think the company's a reasonable company, but it just doesn't seem to be able to get any traction. That's why we need [CEO] Phil Frost on."
First Data Corp.: "We had [CEO] Frank Bisignano on recently and he carried himself well. That was a terrific quarter. What can I say? I did not expect it to be that much of a blowout and it was."
VIDEO4:3404:34Cramer's lightning round: Accounting issues at Flex mean you should sell the stockMad Money with Jim Cramer
Questions for Cramer? Call Cramer: 1-800-743-CNBCWant to take a deep dive into Cramer's world? Hit him up! Mad Money Twitter - Jim Cramer Twitter - Facebook - Instagram - VineQuestions, comments, suggestions for the "Mad Money" website? madcap@cnbc.com
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1b6eaa32266e6f8f133ae256af2113f3 | https://www.cnbc.com/2018/05/22/european-markets-seen-mixed-as-investors-monitor-earnings.html | Europe closes higher amid earnings; autos gain on China tariff cut; Altice rallies 19% | Europe closes higher amid earnings; autos gain on China tariff cut; Altice rallies 19%
European stocks closed higher Tuesday, as China said it would reduce tariffs on cars and auto parts and pressure on Italian markets eased.
The pan-European Stoxx 600 closed up 0.27 percent, with most sectors and major bourses in positive territory.
Italian government bond yields came off 14-month highs on Tuesday, after several days of heavy selling amid concerns about a potential new governing coalition. The proposed link-up of anti-establishment parties had lifted Rome's 10-year yields up nearly 70 points since the start of the month.
Autos were among those to lead the gains, up almost 1 percent after China's Finance Ministry said it would cut the import duty on passenger cars to 15 percent from current levels of 25 percent. The announcement, which came Tuesday, also said tariffs on some automotive parts would fall to 6 percent. Schaeffler and BMW were trading more than 2.5 percent higher following the news.
Telecoms stocks were also among Europe's top performers after the chief of France's telecoms regulator told Le Monde that he was open to consolidation in the sector, re-igniting talk of telecom deals. Altice rose to the top of the sector, up more than 19 percent.
Looking at individual stocks, Fischer surged near the top of the European benchmark after UBS upgraded its stock recommendation to a "buy." Its shares were more than 7 percent higher.
On Wall Street, stocks opened higher, building on strong gains from the previous session.
Meanwhile, surging oil prices ignited market participants' concerns about a flare-up in inflation and faster-than-expected U.S. interest rate increases.
Oil prices rose amid concerns over Venezuela's crude output following a disputed presidential vote. Brent crude traded at $80.40 a barrel, up more than 1 percent, while WTI stood at $72.67, over 0.6 percent higher.
Bank of England Governor Mark Carney said the U.K. economy would bounce back from a weak start to the year. He denied claims that the central bank had confused investors and households by deciding not to hike interest rates earlier this month.
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dcd5bc05ef45d251603f0441257281a8 | https://www.cnbc.com/2018/05/22/even-destination-maternity-is-having-a-gender-diversity-debate-about-its-board.html | Even Destination Maternity is having a gender diversity debate about its board — and dissident women win | Even Destination Maternity is having a gender diversity debate about its board — and dissident women win
VIDEO2:2002:20Activist investors look to add more women to boardsSquawk on the Street
What to expect when you're expecting ... more women on boards?
That was the key question amid an under-the-radar proxy battle at retailer Destination Maternity.
Shareholders were asked to decide whether prior board experience should preclude women from obtaining future board seats. They voted in favor of a dissident slate of board nominees on Wednesday, backed by investors Nathan Miller of NGM Capital and Peter O'Malley of Kenosis Capital. The winning slate had three women and one man nominee.
On the losing side was a slate backed by the company, which nominated three men and one woman, the interim CEO Melissa Payner-Gregor.
Earlier, the nominees by the dissidents, who together hold about 9 percent of Destination Maternity's stock, failed to obtain support from Institutional Shareholder Services, an influential proxy advisory firm, which makes voting recommendations for contested board nominations, among other subjects.
ISS wrote in a May 10 report that shareholders should avoid voting for the dissidents' slate due to concern over "the fact that none of the dissident's nominees have previously served on public company boards."
The dissidents fired back, pointing out the low proportion of women who currently hold that experience. As of the first quarter of 2018, the percentage of women on boards was 16.9 percent among Russell 3000 companies, according to Equilar. The dissidents say that if experience is a pre-determinant to board membership, then the gap between the number of women directors to male ones will never be closed.
"If the company's argument is this chauvinistic trope that women can't join the board because they've never been on as a director before, then this embarrassing situation in Corporate America will never be remedied," O'Malley, managing member of Kenosis Capital, a merchant bank, said in an interview with CNBC.
CNBC requested comment from Destination Maternity five times over the course of five days. The company did not return CNBC's calls or emails but sent shareholders a letter Monday evening.
After speaking with stockholders during the proxy season, Destination Maternity said the company reaffirms "our commitment to increasing gender diversity at the board level by identifying and appointing at least one additional highly qualified female director to the board as soon as possible." ISS declined to comment beyond its report.
After Wednesday's vote, the company share price was down 2.5 percent. Shares of Destination Maternity have slumped 75 percent over the last three years amid management upheaval, a failed takeover bid and dwindling mall traffic that has cut into sales and profitability. The market cap is currently a mere $40 million, and the dissident investors say that if a turnaround doesn't happen quickly, the company wouldn't have long to survive.
"I'd say a year is generous," said Marla Ryan, one of the dissident nominees and founder of Lola Advisors, a business consultancy for the apparel, beauty and wellness industry. Prior to her role there, she held senior positions at Lands' End and J. Crew. "This is a brand that's been around for such a long time and really has that brand equity and awareness. It shouldn't go away."
"But we fear it may," O'Malley said.
On the dissident slate, Ryan is joined by Holly Alden, the co-founder of Stance, a sock manufacturing company, and of Skullcandy, an audio accessory company. Also on the slate are Anne-Charlotte Windal, a retail consultant and former retail equity analyst, and Christopher Morgan, a senior retail analyst at the hedge fund Kingdon Capital Management.
Marla Ryan and Peter O’Malley.CNBC
Destination Maternity was founded in 1982 by Rebecca Matthias and her husband, Dan, who became the company's first chief executive officer. As of Feb. 3, the company operated 1,124 retail locations under the brands Motherhood Maternity, A Pea in the Pod and Destination Maternity. They also lease retail space in other stores like Macy's, BuyBuy Baby and Boscov's, according to company filings.
Recently, the company has faced tremendous challenges. It has not had a permanent CEO in eight months. Melissa Payner-Gregor is Destination Maternity's second interim CEO during that period. She's the company's first female CEO, albeit on a temporary basis.
In its report, ISS said "the company's severe stock underperformance, negative financial results and poor succession planning strongly suggests that additional board change is warranted." The proxy advisory firm urged investors to withhold votes for the chairman, Barry Erdos and CEO Payner-Gregor.
ISS recommended investors vote for Peter Longo, who was appointed in December and had previously run Macy's logistics and operations business, and Pierre-Andre Mestre, chairman of the French clothing retailer Orchestra-Premaman, who was appointed in April. (Orchestra-Premaman had been in a merger agreement with Destination Maternity, which fell through last July, causing further pressure on the shares).
ISS said its voting recommendation "would present an opening for two dissident nominees to be elected, while reducing the risk of the dissident obtaining outright control of the board."
Another proxy advisory firm, Glass Lewis, urged investors to vote for all four of management's nominees.
The company has had two other women directors, aside from Payner-Gregor in its history, but both left in February 2011, according to data compiled by Equilar. Since that period, shares of Destination Maternity have slumped 88 percent.
Slates made up of a majority women are incredibly rare. Only once in the three years starting in January 2015 has a management team or dissident put forth a slate in the U.S. that had a majority women nominees, according to Proxy Insight, which compiles details on shareholder votes. That was in 2016, when Chico's urged investors to vote for its five nominees, four of whom were women. After Chico's received support from ISS and Glass Lewis, the activist, Barington Capital, dropped its proxy fight.
"If you drink from the same bucket of water over time, you only know one taste," Ryan said in an interview with CNBC. "Some argue that there are not enough qualified women. So we need to equip them to get them up there and give them opportunities along the way to make that happen."
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e34a90610ff23d5a849c0013dfdc938f | https://www.cnbc.com/2018/05/22/futures-point-to-a-higher-open-after-stocks-break-above-25000.html | Dow drops nearly 200 points after Trump says he's not satisfied with China trade talks, North Korea summit may not happen | Dow drops nearly 200 points after Trump says he's not satisfied with China trade talks, North Korea summit may not happen
VIDEO5:5305:53Market wants this trade issue out of the way: SantoliClosing Bell
Stocks dropped on Tuesday after President Donald Trump said he was not satisfied with U.S.-China trade talks. He also said a highly anticipated summit with North Korea may not happen after all.
The Dow Jones industrial average fell 178.88 points to close at 24,834.41 as Boeing shares declined 2.5 percent. The declined 0.3 percent to 2,724.44 with energy lagging. The Nasdaq composite lost 0.2 percent to close at 7,378.46.
Trump told reporters he was "not satisfied" with the trade talks that took place with China last week. He called the negotiations a "start" as his administration keeps working toward a final deal to address trade imbalances with Beijing.
The president also discussed a summit with North Korean leader Kim Jong Un, stating: "Whether or not it happens, you'll be knowing pretty soon." The summit is scheduled for June 12 in Singapore.
"There's a lot of uncertainty right now and that's reflected in the tight trading band we've been in for the past few months," said Jennifer Ellison, principal at Bingham, Osborn & Scarborough.
Traders work on the floor of the New York Stock Exchange on Jan. 30, 2018 in New York City. Spencer Platt | Getty Images News | Getty Images
Stocks started the session trading higher after China said it will reduce levies on automakers and car parts. China's Finance Ministry said tariffs on certain vehicles will come down to 15 percent from as much as 25 percent while levies on some parts will be brought down to 6 percent effective July 1.
Shares of Ford and General Motors rose on the news, gaining 0.1 percent and 0.5 percent, respectively. Tesla initially rose more than 1 percent before sliding 3.3 percent.
The announcement by China comes after Treasury Secretary Steven Mnuchin told CNBC on Monday the U.S. has made "very meaningful progress" with China on trade matters, noting: "Now it's up to both of us to make sure that we can implement it."
Mnuchin's comments helped push the Dow up nearly 300 points as Wall Street interpreted the remarks as tensions between the U.S. and China easing. The Dow also closed above 25,000 for the first time since March on Monday.
Rising trade tensions between the U.S. and China, coupled with rising rates and inflationary fears, pushed stocks off of record highs earlier this year. Since then, the major indexes have recovered slightly from those losses.
However, Steve Chiavarone of Federated Investors said he is not too worried about the tensions between the two giant economies, noting the amount of money in tariffs proposed is far smaller than the benefit of lower taxes. "It's like 20 to 1," the firm's assistant vice president said.
VIDEO1:1901:19The VIX is sending signals about the market rallyTrading Nation
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839aa116a5b6e0390e2a193292c7ef98 | https://www.cnbc.com/2018/05/22/ge-charts-must-show-this-before-rebound-looks-real-oppenheimer-says.html | GE’s charts need to show this before the rebound looks real, Oppenheimer technician says | GE’s charts need to show this before the rebound looks real, Oppenheimer technician says
VIDEO1:5301:53Trading Nation: Is worst behind GE?Trading Nation
Calling a bottom in General Electric has been among the more painful and fruitless endeavors on Wall Street over the past decade.
With shares now touching a three-month high, many are hoping the worst is finally behind the ailing industrial giant. A top technical analyst has a simple message: Don't hold your breath.
"The stock has moved through this $15 level, a little bit of a near-term breakout," Ari Wald, head of technical analysis at Oppenheimer, told CNBC's "Trading Nation" on Monday.
But to get fully get behind GE's rebound, Wald needs to see a shift in its 200-day moving average at the minimum.
"At the least we want to see that 200-day start to turn sideways, ideally even higher," said Wald. "So, best thing we can say is that we wouldn't bet against it, but we're placing our bets elsewhere."
GE's 200-day moving average has been in decline since April 2017, the last time its shares traded above the technical level, and has fallen 40 percent during the past year.
The options market also remains skeptical of GE's rally, according to Dennis Davitt, partner at Harvest Volatility Management.
"People are not believing in it in the options market," Davitt said on Monday's "Trading Nation." "We saw a big buyer of options, shorter-dated options, one-month options, that are expiring — the June $14 put. We've had big buyers of them in the marketplace."
Put contracts increase in value as a stock declines.
GE shares rose on Monday after the company announced plans to merge its transportation business with rail equipment company Wabtec. The $11 billion deal, expected to close early next year, is the latest in GE's efforts to winnow operations to focus on its core industrial portfolio.
Beyond these deals, Davitt says GE must tackle its balance sheet before he can warm up to the stock.
"Until I see something come out of their liabilities on the financials side, the other stuff is just noise to me and that's kind of what the options market is saying," he said.
GE closed out its March-ended quarter with $106.5 billion in long-term debt on its balance sheet.
Disclaimer
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3ddb4737898ec427caa8de42f587f48d | https://www.cnbc.com/2018/05/22/gop-house-closes-a-loophole-linked-to-puerto-ricos-financial-crisis.html | In loosening bank regulation, GOP House closes a loophole linked to Puerto Rico's financial crisis | In loosening bank regulation, GOP House closes a loophole linked to Puerto Rico's financial crisis
San Juan, Puerto Rico.CNBC
U.S. lawmakers closed a long-standing legal loophole that helped spark a financial crisis in Puerto Rico that has decimated the savings of thousands of residents.
Tucked inside legislation that passed the House of Representatives Tuesday night — a larger bill largely focused on rolling back Dodd-Frank banking regulation — is a provision that creates greater oversight of brokerage firms operating in U.S. territories.
The provision ends a 78-year-old legislative loophole that allowed subsidiaries of global banking institutions that operated in U.S. territories, like Puerto Rico, to do certain types of financial transactions that are legally barred stateside.
This exemption from the so-called Investment Company Act of 1940 also allowed funds in Puerto Rico to skirt leverage standards and certain affiliated party transactions that apply to funds operating in the U.S.
The loophole allowed for Swiss banking giant UBS and other banks to underwrite specific Puerto Rico bonds and then sell them directly into bond funds that were sold only to island residents, a CNBC investigation, published in December, found.
VIDEO0:0000:00Bill does not weaken regulations for largest banks: Barney FrankClosing Bell
The funds, which were not registered with the SEC, were highly levered and concentrated largely in Puerto Rico bonds, which became practically worthless in recent years. The residents who bought them lost billions of dollars in savings.
The legislation passed Tuesday repeals the exemption to ensure that financial institutions that operate in all U.S. territories, including Puerto Rico and the U.S. Virgin Islands, have to abide by the same rules as their stateside counterparts. Funds issued and sold to investors by institutions in Puerto Rico will now need to be registered with the SEC.
CNBC's investigation prompted Rep. Nydia Velázquez (D-N.Y.) to call for a congressional hearing to investigate the marketing and sales practices of investment companies operating in Puerto Rico. Her office is expecting that the passage of Tuesday's bill will negate the need for such a hearing.
Velázquez, a senior member of the House Financial Services Committee, had tried three times before, in 2015, 2016 and last year, to close the loophole. But her prior bills, which weren't part of a bigger legislative package, failed to pass.
When Congress first enacted the Investment Company Act of 1940, it was deemed too expensive for regulators with the SEC to travel to U.S. territories — which then also included Alaska and Hawaii, in addition to Puerto Rico and the U.S. Virgin Islands.
Since then, both Alaska and Hawaii have become states, air travel to and from Puerto Rico has become less expensive and a large portion of financial activity takes place electronically. That makes it far easier for regulators to patrol financial activities in U.S. territories than it was 78 years ago, Rep. Velázquez has argued.
The bill, called the "Economic Growth, Regulatory Relief and Consumer Protection Act, passed on Tuesday.
Velazquez said she voted no on it for other reasons. For example, the bill rolls back many protections for bank customers, including preventing discrimination against minorities in mortgage lending. It also raises the threshold for a bank to be considered systemically important to $250 billion in assets. It was seen as favorable to medium-sized U.S. banks by loosening some of the current rules.
"On balance, these are poor choices that, in my view, heighten the risk of improper financial activities similar to those that precipitated the 2008 financial crisis," Velazquez said in a statement.
On-island financial institutions will have three years to comply with the new rules, assuming they get signed into law. The SEC has to option to grant an additional three years, if warranted.
"This bill will put Puerto Rico's mutual fund industry in regulatory parity with the Mainland and, at last, bring to an end decades of exploitation of Puerto Rican investors," Velázquez said in a written statement. "I am heartened, at least, that by passing my legislation, as part of this larger package, we will no longer hear of the people of Puerto Rico being swindled out of their nest eggs due to an antiquated loophole in federal investment law."
VIDEO3:4703:47Dodd-Frank overhaul: 5 buys
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9965eaa21eb66534d19d6636dbe3c653 | https://www.cnbc.com/2018/05/22/how-to-mute-somebodys-instagram-stories.html | Instagram adds two new functions that could help curb your Instagram addiction | Instagram adds two new functions that could help curb your Instagram addiction
Instagram Co-Founder and CEO Kevin Systrom speaks onstage at the inaugural Girlboss Rally on March 4, 2017 in Los Angeles.Getty Images
Instagram is introducing new features to help people manage what they see and how much time they spend on the app.
The moves to allow people to have more control could be a reflection of parent company Facebook's tweaks to protect users' "well-being" on its platform. Facebook admitted in December that using its products could have negative effects on mood and mental health. The company said Tuesday the company is rolling out a feature to mute people in your main feed over the next few weeks. With this feature, a person will be able to click on the three dots in the upper right corner above a user's post. A menu will appear, with the option to mute the user's posts or mute the user's post and stories.
"Mute can make your feed even more personalized to what matters to you," an Instagram spokesperson told CNBC. "We've also heard it may be a useful tool for managing complex social dynamics."
Currently, you are allowed to "mute" selected Instagram Stories. Here's how it works: Just tap and hold the profile picture of the person whose Stories you no longer want at the top of your feed. Then, you can select an option to mute that user. The user's Stories will no longer autoplay and will automatically go to the back of the list. With this method, the muted person's regular Instagram content will still appear in the main feed unless you completely unfollow them.
Instagram is also testing a feature that will let people know when they have seen all the posts from their network posted during the previous 48 hours. The notification, which was first reported by TechCrunch, says "You're All Caught Up – You've seen all new posts from the past 48 hours" and appears in the middle of the feed. We didn't see this feature yet, but Instagram confirmed it's under testing.
That said, it's nearly impossible to view all the posts in that time frame because of the amount and rate content is posted. (Trust us, we tried.)
VIDEO5:5505:55Tech experts urge you not trust Instagram or FacebookSquawk Alley
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ddb8ee0ac4f84f05162b28283cc606b8 | https://www.cnbc.com/2018/05/22/inflation-is-coming-to-the-u-s-economy-on-an-18-wheel-flatbed.html | Inflation is coming to the US economy on an 18-wheel flatbed | Inflation is coming to the US economy on an 18-wheel flatbed
Getty Images
Investors and policymakers have gone looking for inflation over the past decade and largely have come up empty.
It could, however, come barreling at them soon like an 18-wheeler.
Multiple signs of inflation in freight-related industries are at or near historical highs, in what could be an early sign that price pressures are building and ready to reverberate around the economy.
Freight marketplace DAT keeps track of supply and demand in the freight industry through a bulletin board that matches companies with loads to be delivered to the vehicles that will take the goods to the marketplace. The measures are in the spot market, where vendors that don't contract their deliveries find drivers for their products.
Recent readings show demand for vehicles skyrocketing, a sign that generally points to inflationary pressures building up in the supply chain.
"It's an indication that there's capacity pressure in the marketplace, that brokers are searching more and posting more in order to find a truck," said Peggy Dorf, market analyst at DAT. "This is an indicator that pressure is much higher than it was a year ago."
Metrics the firm uses to track demand for trucks are showing a sharp increase and outstripping the number of drivers available. Supply-demand dynamics, then, would indicate rising rates for trucks that could lead to pricing pressures on a broader level.
Loads on the spot market in general are up 100 percent from the same period a year ago. Another measure, the flatbed load-to-truck comparison, which tracks the amount of vendors looking for flatbeds and is generally the highest of all truck types, is up 142 percent.
Every other broad market trend line that DAT posts was up double digits on a year-over-year basis — including the all-important fuel costs, which are up 20 percent.
"Trucking in general is a leading indicator," Dorf said. "If the economy is also growing, it's one of those rising tides [that] lifts all boats. The pressure on the spot market doesn't seem to have let up."
The numbers by themselves, though, don't indicate that inflation is ready to strike soon. Indeed, the most recent readings, such as the consumer and producer price indexes, show inflation pressures rising though relatively benign.
But they do jibe with some other indicators showing inflation is rising beneath the surface.
Also, the New York Fed's Underlying Inflation Gauge, which goes beyond more popular data sets like the consumer price index, rose to 3.2 percent in April, its highest reading since July 2006. The Atlanta Fed's Sticky-Price CPI gauge, a measure of goods whose prices are less prone to fluctuation, was up 2.5 percent in April, its highest level since February 2017.
VIDEO4:3104:31More than 50,000 truck drivers needed nowClosing Bell
Now, the rapid increase in trucking demand is beginning to gather attention, with some corners of the financial markets wondering how long it will take until broader inflation gauges are impacted.
"When you have price pressure that is above and beyond what's normal, someone has to eat it," said Peter Boockvar, chief investment officer at Bleakley Advisory Group. "The truckers are obviously going to charge more for their services because they can, the buyers of that stuff who need the trucks are not going to eat the cost. They're going to do their best to pass it down."
While the most recent reading of the producer price index showed just a 2.6 percent gain over the past 12 months, the freight subindexes told a different story: truck transportation jumped 6 percent, rail was up 5.1 percent and air rose 3.9 percent. Overall, the general freight trucking component is just below the all-time high it hit in February.
General freight trucking component of the producer price index, from 2008-present.
Source: FactSet
"Demand is still exceeding capacity in most modes by a significant amount. In turn, pricing power has erupted in those modes to levels that spark overall inflationary concerns in the broader economy," Donald Broughton wrote in the most recent Cass Freight Index Report, a widely read industry publication.
While Broughton, founder and managing partner of Broughton Capital, said he believes technological improvements will offset long-term price pressures, he added that transportation indicators are showing noteworthy levels.
"April's 12.8% increase [in the Cass Freight Expenditures Index] clearly signals that capacity is tight, demand is strong, and shippers are willing to pay up for services to get goods picked up and delivered in modes throughout the transportation industry," he wrote. "We should also remind readers of a fundamental rule of marketplaces: volume leads pricing. Repeatedly we have watched in a host of different markets, that volume goes up before pricing starts to improve and volume goes down before pricing starts to weaken."
And the pricing indicators are quietly pointing higher.
Spot market rates for flatbeds were at $2.71 a mile for the week ended May 12, just a penny off the record they had set the week before, according to DAT. A number of trucking companies reported big rate jumps in the first quarter. Daseke said its rates were up 10 percent for flatbeds, while Universal Logistics Holdings said revenue per mile excluding fuel surcharges rose 12.7 percent annually, according to a Journal of Commerce report.
The surge in demand has led to driver shortages and sharp pay increases, which are likely to be ultimately passed onto consumers.
"We're paying a lot more than we ever had," Robert Ragan, chief financial officer of Melton Truck Lines, recently told CNBC. "We're in a unique operating environment right now in the transportation industry, where demand is at an all-time high and supply of qualified drivers continues to dwindle. We have a hard time filling our trucks, and pay is skyrocketing."
It all adds up to an environment that could prove tricky ahead.
The Federal Reserve is continuing to raise interest rates, with at least two more quarter-point hikes expected this year. Central bank officials watch a number of indicators, and if more start flashing inflation signals, that could mean a faster pace of rate increases ahead.
"It's inevitable that prices will go up," Boockvar said. The Fed is "on autopilot now, unless things accelerate on inflation."
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e1946f6e87e3a22f72818bf362796abb | https://www.cnbc.com/2018/05/22/its-too-early-to-say-trump-caved-on-trade-negotiations-with-china.html | It's too early to say Trump caved on trade negotiations with China | It's too early to say Trump caved on trade negotiations with China
VIDEO3:1703:17US-China trade spat about political gain for Trump ahead of midterms: StrategistSquawk Box Europe
President Donald Trump likes to play the game big — big hotels, big deals and big promises of the things he wants to accomplish, both in his previous life as a real estate magnate and his current iteration as the head of state.
When it comes to trade, though, the president is in the uncomfortable position of having to play small ball, a baseball term referring to moving runners around the bases in a slow, deliberate manner instead of trying to hit the ball out of the park.
So it comes with his latest China trade endeavors, in which the president's hopes to obliterate a $375 billion trade deficit are proceeding not with grandiose game-changing home runs but with the equivalent of check-swing singles.
Trump scored a run this week with China's pledge to reduce tariffs on imported autos. But at this pace, it's going to be a long game, and even he conceded that he wants more from the talks.
"For President Trump, it's about the direction, it's about the message. He can say, 'Look, I'm making America great again,'" Neil Dwane, global strategist at Allianz, told CNBC. "But it's taken 20 years for America to get this trade deficit to this level. It's going to take them 10 or 20 years to redress it, even if they possibly can."
Indeed, the president's hopes to erase the deficit with China never had a chance of happening, and it's likely he knows that.
Donald TrumpCarlos Barria | Reuters
He wanted more out of the recent negotiations between an administration entourage and Chinese officials than the auto deal and a vague promise to import more American goods that did not come with the dollar figure the White House sought.
But criticism in some quarters that Trump caved to China's demands doesn't seem fair, just as expecting immediate results in the U.S.-China talks seems unrealistic.
"I think it's too early to cast aspersions on the administration. It is positive that there is less of a focus on tariffs and more of a focus on the broader trade relationship," said Dean Garfield, president of the Information Technology Industry Council, an advocacy organization monitoring the negotiations both in the U.S. and in China.
Tech has been a focal point of the talks. The U.S. is concerned about intellectual property theft and other issues, and tech firms want the ability to operate cloud computing, financial payment systems and other businesses in China without constraints.
Garfield said he's willing to be patient with the negotiations, but hopes to see tangible agreements in place before the end of the year.
"This is not something that's going to get hashed out in a couple of weekends," he said. "What we're talking about is driving structural changes to China's trade approach, which is a long-term endeavor."
Markets have generally responded positively to the pace of negotiations so far.
Stocks rallied strongly Monday, then tailed off a bit Tuesday as skepticism grew over whether Trump would hold a hard line and get significant concessions. There also are concerns with what approach the administration will take with Chinese telecom ZTE, which has faced stiff U.S. sanctions for multiple trade violations and has become a focal point in the trade talks.
Major averages were mixed around noon, but automakers were mostly positive — electric car maker Tesla was an exception — and semiconductors also rallied.
Paul Hickey of Bespoke Investment Group said the auto tariff news as well as the ZTE negotiations "are all positive developments suggesting that the two parties are working out deals to resolve their disputes."
Markets particularly liked Treasury Secretary Steven Mnuchin's comments over the past few days that a trade war has been averted, at least for now.
However, there remain fears that the peace may not last.
"We are quite concerned that this could be a temporary truce," Eli Lee, head of investment strategy at the Bank of Singapore, told CNBC. "At the end of the day, I think this issue could come back to the forefront."
WATCH: The Chamber of Commerce CEO talks trade.
VIDEO4:1504:15Chamber of Commerce CEO on China trade talksSquawk Box
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b620b3d8267fe6821cb855aba08e8d21 | https://www.cnbc.com/2018/05/22/john-bolton-joins-us-china-trade-talks.html | Trump's hawkish national security advisor John Bolton jumps into the White House's China trade talks | Trump's hawkish national security advisor John Bolton jumps into the White House's China trade talks
National Security Adviser John Bolton.Nicholas Kamm | AFP | Getty Images
As the U.S. and China continue hashing out trade negotiations, a new player has joined the fray: President Donald Trump's national security advisor, John Bolton.
A National Security Council official told CNBC that it was only "natural" that Bolton be involved in recalibrating the U.S. trade relationship with China.
"Rebalancing trade and investment relations are an important component of the President's overall strategic approach to China, and therefore it is natural that the National Security Adviser would play a role in ensuring U.S. economic officials' ongoing discussions with China are framed within that strategic approach," the official said.
Bolton's involvement in trade negotiations signals a broadening scope of authority for the president's top national security aide, whose views on the U.S.' shifting relationships with North Korea and Iran were central points of scrutiny when he was appointed in March.
The high-stakes trade talks between the U.S. and China come as the Trump administration prepares for a June summit with North Korean leader Kim Jong Un, a frequent target of Bolton's criticism over the years. North Korea, likewise, recently criticized Bolton while threatening to pull out of the landmark meeting. China, which is North Korea's biggest and most important ally, has played a key role in arranging diplomatic connections between the communist dictatorship and the U.S.
The hawkish Bolton has also been outspoken on China trade policy. In a talk-radio interview in March, Bolton said China has for too long "taken advantage of its place in the world" through "the trade arrangements it has with the United States and other countries," multiple outlets reported.
VIDEO2:0302:03Never was a trade war, it was a trade dispute with China: Sec. MnuchinPower Lunch
He added that a revamped trade policy with China "could be a little shock therapy, get their attention, and hopefully it'll have a good impact."
Bolton also suggested, in a 2016 op-ed for the Wall Street Journal, that the U.S. should challenge China's relationship with Taiwan — which China considers to be an official part of its country through the "one China" policy. He even appeared to suggest that military intervention should not be off the table.
Bolton has had rocky history with North Korea. About a month before he was tapped to join the White House team of core advisors to the president, he penned an op-ed for the Journal laying out a case for a pre-emptive attack on North Korea.
Prior to Bolton joining the Trump team, the White House's "maximum pressure" campaign had been a seen as a catalyst for progress between the two nations.
Kim Jong Un's regime made overtures toward thawing relations with the U.S. and South Korea. Kim vowed to destroy its only known missile test site and agreed to landmark talks with South Korean President Moon Jae-In and, separately, a summit with Trump.
But annual military drills between the U.S. and South Korea, which North Korea views as a threat, spurred the regime to abruptly call off the talks with its southern neighbor and potentially cancel Kim's meeting with Trump.
Worse for the prospect of the Trump-Kim meeting, which is still currently scheduled for June 12 in Singapore, was North Korea's angry reaction to Bolton's latest statements on ridding the rogue regime of nuclear weapons.
Bolton said in television interviews on May 13 that the U.S. had the "Libya model" of denuclearization in mind going into talks with North Korea. Libya's dictator at the time, Muammar Gaddafi, agreed to relinquish his nuclear weapons in exchange for the U.S. relaxing sanctions on his country.
VIDEO1:3501:35China to cut import tariffs on autosSquawk Box
Gaddafi was later killed in the street by a mob of his own people in a violent insurrection — a vision that appears to serve as Kim's main takeaway from the "Libya model."
North Korea's vice foreign minister on Wednesday said his country does "not hide our feeling of repugnance towards" Bolton, and referenced his remarks about Libya in a searing statement.
Trump quickly distanced himself from Bolton's analogy in Oval Office remarks last week.
"The Libyan model isn't a model that we have at all," Trump said Thursday.
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83b729683b0c1940e249cbd5adeea0f8 | https://www.cnbc.com/2018/05/22/lumiwatch-uses-built-in-projector-to-turn-your-arm-into-a-touchscreen.html | This watch turns your arm into a touchscreen | This watch turns your arm into a touchscreen
VIDEO0:5900:59LumiWatch turns your arm into a touchscreenDigital Original
Researchers at Carnegie Mellon University and ASU Tech have come up with an idea for a projector watch that turns your arm into a touchscreen. The LumiWatch prototype uses a built-in, 15-lumen laser projector to display a smartphone-sized interface on the user's arm. It can be swiped and tapped like a traditional touchscreen. The watch has custom software that removes image distortion and calibrates the screen for each user. The battery will run for an entire day and can run a continuous projection for around an hour.
If it were to eventually go on sale, the researchers estimate it would cost around $600.
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a7aaf39a2d451b4fb39e5284b719631e | https://www.cnbc.com/2018/05/22/markets-fail-to-appreciate-how-much-further-earnings-have-to-grow.html | Markets are failing to appreciate how much further earnings have to grow, asset manager says | Markets are failing to appreciate how much further earnings have to grow, asset manager says
Traders and financial professionals work on the floor of the New York Stock Exchange.Drew Angerer | Getty Images
The U.S. may be close to the peak of its earnings cycle, but earnings still have room to climb — and markets are failing to reflect that potential, according to asset manager NN Investment Partners (NNIP).
Investors seem to have reacted with near indifference to an objectively strong corporate earnings season. Reuters calculated that first quarter earnings were expected to increase 27 percent from the first quarter of 2017.
Of the 465 companies in the S&P 500 index that reported earnings up to May 18, about 80 percent reported earnings above analyst expectations, the wire agency reported. As for revenues, 75.2 percent of companies reported first quarter 2018 revenue above analysts' expectations.
But stock market averages are barely higher than they were at the beginning of the season — as of Tuesday, the S&P 500 was a negligible 0.6 percent higher than it was at the year's start.
Netherlands-based NNIP, in a research note Tuesday, described the market response so far as "lukewarm." Analysts have put this down to earnings expectations being priced-in, a record bull climb in 2017 that couldn't be sustained, and expectations of Federal Reserve monetary policy tightening along with trade war fears.
VIDEO4:2604:26Stocks kick off May on a low note during a key week for the marketTrading Nation
Still, the investment firm predicts the U.S. may well be able to sustain its earnings levels for some time.
"This looks like a typical late cycle phenomenon. Investors are looking for signs that the earnings cycle is near its peak, which in absolute earnings growth terms is likely," said Patrick Moonen, principal strategist multi asset at NN IP, noting that next year growth will fall back towards single-digit territory.
Nonetheless, he added: "At the same time, there are indications that while we are in late cycle it is not down-cycle — since mid-April, the momentum in sales and gross operating profit are accelerating again."
Moonen said that wage growth has been muted despite unemployment falling below 4 percent, therefore not putting a major strain on profits.
Investors have expressed bewilderment at the current market. Barings CEO Tom Finke, who heads up the firm's $304 billion in assets under management, called it "a very strange recovery." He said: "We have sectors that are dying and industries that have grown dramatically, and valuations that seem unrealistic... but Amazon keeps growing." The reference to the tech giant was a nod to its more than 34 percent stock price increase since the start of this year.
But while NNIP seems confident about the road ahead for corporate earnings, others are not so keen on holding onto equities in the current climate.
"Take your money off the table," Cross Border Capital Chief Executive Michael Howell told CNBC's "Squawk Box Europe" on Tuesday. He warned that rising bond yields and a flattening yield curve, which mean higher borrowing costs and indicate negative investor sentiment toward short-term lending, respectively, should make those invested in equities "very worried."
Other investors have cautioned against underestimating the impact of quantitative tightening, as central banks gradually raise interest rates from post-financial crisis lows.
VIDEO3:5103:51Yield curve points to challenges for US economy, warns investorSquawk Box Europe
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68f86fe07d044575c491a5ff5a3ee93f | https://www.cnbc.com/2018/05/22/mcdonalds-is-being-sucked-into-the-movement-to-ban-plastic-straws.html | McDonald's is being sucked into the movement to ban plastic straws | McDonald's is being sucked into the movement to ban plastic straws
A container with a drink is served at the McDonald's fast-food outlet.Philippe Huguen | AFP | Getty Images
The plastic drinking straw, one of the smallest components in the mountain of trash remaining after the typical fast-food meal, has become an unlikely battleground in the war on waste.
A proposal being presented to McDonald's shareholders at their annual meeting Thursday asks that the chain find alternatives to plastic straws at its more than 36,000 restaurants worldwide.
The vote is just the latest shot in a growing backlash against excessive and hard-to-recycle packaging in the fast-food industry, whether it's plastic wrap, plastic foam cups, boxes, carryout bags or trays. The trash pile keeps growing.
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"It's terrible and it only seems like it is getting worse," said Beth Terry, author of Plastic-Free: How I Kicked the Plastic Habit and How You Can Too.
All told, the nation produced 258 million tons of municipal solid waste in 2014, compared to 88 million tons in 1960, based on the most recent data from U.S. Environmental Protection Agency. And almost a quarter of it was various containers and packaging.
McDonald's, citing big efforts already underway to reduce waste and promote recycling, is recommending shareholders vote against the straw study proposal.
"We continue to work to find a more sustainable solution for plastic straws globally," the chain said in a statement Monday. "In the meantime, we have adopted compostable straws in certain markets to meet regulations while we work with packaging experts to develop a planet-friendly, cost-effective answer for all McDonald's restaurants."
A group called SumOfUs wants quicker action. It said it has collected more than 480,000 names on an online petition so far calling on McDonald's to end use of plastic straws. The group estimates McDonald's hands out millions of single-use plastic straws a day.
"Straws are an important issue because, for the most part, we can do without them," said Sondhya Gupta, a London-based senior campaigner for SumOfUs. "You just get them popped into a drink without thinking about them. They are small and they are light so they are difficult to recycle."
The consumer organization cites an academic journal story that appeared last year estimating only 9% of plastics ever produced were recycled.
If McDonald's were to ban plastic straws, it wouldn't be alone. Alaska Airlines just said it is eliminating plastic straws on its flights. A few cities, mostly in California, have imposed bans.
While McDonald's contemplates action in the U.S., it is moving ahead in the United Kingdom. It is replacing plastic straws with paper versions in some restaurants in a test this month.
"Additionally, customers have told us that they want to have to ask for a straw, so we're acting on that and moving them behind the counter," said Paul Pomroy, CEO of McDonald's UK. "Together with our customers we can do our bit for the environment and use fewer straws."
McDonald's points out, too, that it has already pledged to make all customer packaging from renewable, recycled, or certified sources by 2025, up from 50%. It will also institute recycling at all its restaurants by 2025, up from 10%.
Activists like an author Terry salute McDonald's moves, but at the same time, they say the losing ground on other fronts.
For instance, the current food industry trend of promoting home delivery also means more boxes and additional packaging. "The more progress we make, the more we fall behind," said Terry, based in Oakland, Calif.
"Things are beginning change, but the pace is still too slow," said Eric Goldstein, senior attorney for the Natural Resources Defense Council.
Pressure for change is building, however, forcing more food companies to talk about their efforts to be sustainable.
Some 15% of global food and drink launches mentioned environmentally-friendly packaging in the 12 months leading up to May last year, up from 11% four years previously, according to the global market research firm Mintel.
While McDonad's wrestles with straws, other chains are taking action in different ways.
Starbucks. The chain has set aside $10 million to award grants to inventors in the quest for a compostable coffee cup.Dunkin' Donuts. It is nixing plastic foam cups from all its locations worldwide by 2020.Chipotle Mexican Grill. It says it will cut waste from packaging and leftover food destined for landfills in half by 2020 and initiate recycling at all its locations.
Besides groups, pressure to cut waste is also coming directly from consumers. In the U.S., 78% of adult food shoppers surveyed said brands should work to make packaging more environmentally responsible, Mintel said.
About a third of diners say they actively seek out restaurants that offer environmentally-friendly disposable packaging and avoid those that don't, found tracking firm Technomic. More than half say they're willing to pay more for environmentally-friendly packaging.
Other experts, however, have their doubts.
Tom O'Guinn, a University of Wisconsin expert on consumer behavior, said packaging issues aren't enough to sway diners' decisions on where to eat.
"The average American doesn't care lot about this," he said. "People don't want to sit there and think, 'Gee, this is a slight improvement in packaging.'"
But Terry, who says she has weaned herself down to consumption of about two pounds of plastic a year, said any progress is good -- even if it's just about straws.
"We are not going to solve this problem all at once," she said.
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5ad0d1a9fdccdf952068f9ad5d9931fd | https://www.cnbc.com/2018/05/22/meet-the-most-hated-stocks-in-the-market-today-consumer-staples.html | Meet the most hated stocks in the market today: Consumer staples | Meet the most hated stocks in the market today: Consumer staples
Stephanie Kuykendal | Bloomberg | Getty Images
Just how contrarian are you? How to know when the onrushing herd has it right? When following Warren Buffett's credo to be greedy when others are fearful, where's the line between brave and foolhardy?
These are the self-directed questions of an investor today mulling Wall Street's most-hated trade: owning the classic American consumer-staples stocks.
Exactly how much does Wall Street hate the packaged-food and household-products group? Let's count the ways:
The shares of Campbell Soup, General Mills, Kraft Heinz, Procter & Gamble, Colgate-Palmolive and Clorox are down between 17 and 30 percent year to date, compared with a slight gain for the S&P 500.Aside from Kraft Heinz, those stocks currently carry buy ratings from one-third or fewer of the analysts who cover them versus a bit more than 50 percent buys among all large-cap stocks.Goldman Sachs strategists calculate that hedge funds collectively have a bigger bet shorting the consumer-staples stocks than owning them.An already disliked group got another kick Friday with Campbell Soup's lousy results accompanying the hasty departure of its CEO of seven years, Denise Morrison. She joins the former heads of Mondelez and General Mills in a gust of CEO turnover atop Big Food, a sign that the operating climate itself is forcing abrupt change.
While worse-positioned than most old-line food makers (heavily dependent on passe canned soup, and on condensed soup at that), Campbell is representative of the group's difficulties: fraying loyalty among younger consumers for older brands and processed foods, rising commodity costs with little pricing power, and stiffer competition from retailer-controlled private-label products.
Michael Ramlet, founder of the market-research firm Morning Consult, told CNBC's "Closing Bell" on Monday that the Campbell's brand fell 22 positions in a consumer ranking among millennials compared with its standing with baby boomers and Generation X.
VIDEO1:1901:19The VIX is sending signals about the market rallyTrading Nation
If those operating pressures weren't bad enough, the stocks are a bad fit for the current market moment. A thrumming U.S. economy has more cyclically geared investments in fashion. Rising bond yields make the staples companies' once-coveted dividend payouts less interesting.
Even the companies' efforts to escape the trap of "tired 20th-century brand portfolio" through targeted acquisitions have failed to win over investors. General Mills has acquired Annie's organic-snacks, Cascadian Farms organic products and Blue Buffalo pet foods, but it has so far gotten the company plenty of new debt without diverting investor attention away from its struggles in cereal and yogurt.
Acquisitions or mergers involving the staples companies themselves are a constant topic of wishful chatter on Wall Street. Yet there are only a few large, likely buyers such as Kraft Heinz, Nestle, Unilever and Danone, and none has been tempted yet. Because the U.S. staples companies generally have a fair amount of debt or are too large, private equity purchases are a stretch at current share-price levels.
Which leaves an investor with the conclusion that most of what there is to like about this sector is how hated it is. Plus the faith — shared by Buffett himself — that the decline in sales is not accelerating or permanent.
Esteemed deep-value hedge-fund investor Seth Klarman of Baupost Group has said, "Value investing is at its core the marriage of a contrarian streak and a calculator."
The pervasive gloom surrounding the staples stocks, detailed above, shows that buying them here qualifies as contrarian. As for the calculator, some of the numbers are starting to fall into line.
The food stocks now all trade at steep discounts to both the broad market and their own history, based on current forecast profits — which, admittedly, have come down and might continue falling. The forward price/earnings ratios of Campbell, General Mills and Kellogg relative to the S&P 500 have not been as low as they are today for 15 to 18 years. P&G, Colgate and Clorox were last this cheap on a relative basis seven to nine years ago.
And while their dividend streams might no longer be the only game in town for income and will not do much to buffer further share-price declines, several of these stocks yield above 4 percent, on par with high-grade corporate bonds.
One reason investors seem so certain of the hopelessness of the staples' business prospects is how wretched their stock performance has been over the past two years: Campbell cut in half, General Mills down 42 percent since the spring of 2016, in a market that's up 30 percent.
Back then, of course, the market pushed these stocks to historically overvalued levels, in love with what they thought were their stable, defensive businesses, low volatility and reliable yields.
There is no saying the pantry-and-medicine-cabinet companies are cheap enough yet, even at half their P/Es of two years ago. But at some point and some price, they will require merely "less bad" news or one deal announcement or a sufficiently urgent strategic restructuring or a hint of stabilizing sales trends to start a recovery.
Probably the last group that was considered similarly uninvestable was the brick-and-mortar retailers last year, after Amazon's purchase of Whole Foods.
The stocks went down relentlessly for months and seemed like perpetual value traps, before staging a fierce rebound — though not close to full recoveries of all losses.
And perhaps we're seeing something similar now with General Electric — the poor corporate performance and ugly stock action came in so many waves and went so much further than most thought possible, that the negative case for the stock came to seem irresistible. GE shares are up 20 percent in the past several weeks — but are still down by half since a year ago.
Is that a comfort to the would-be contrarians in consumer-staples stocks — or a dire warning?
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ae73765943cf9a2c10bebf57e9826e1f | https://www.cnbc.com/2018/05/22/moon-travels-to-washington-in-bid-to-save-trump-kim-summit.html | Moon travels to Washington in bid to save Trump-Kim summit | Moon travels to Washington in bid to save Trump-Kim summit
President Donald Trump (R) greets South Korean President Moon Jae-in prior to delivering a joint statement from the Rose Garden of the White House in Washington, U.S., June 30, 2017.Jim Bourg | Reuters
South Korean president Moon Jae-in will meet Donald Trump in Washington on Tuesday in a bid to salvage a potentially historic summit next month between the US leader and North Korea's Kim Jong Un.The hastily arranged White House trip is intended to reassure the Trump administration, which has indicated concern that next month's summit could fail, and irritation at Mr. Moon's own performance as a go-between.
"It now seems Mr. Moon is the most anxious that the talks between Mr. Trump and Mr. Kim could fall apart," said Kim Jae-chun, a professor at Sogang University in Seoul.
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While South Korea has positioned itself as the intermediary between Washington and Pyongyang for months, tensions have increased in recent days over the issue of the denuclearization of North Korea's weapons arsenal.
US officials — in particular John Bolton, Mr. Trump's hawkish national security adviser — see a firm commitment to "denuclearize" as a key first step by Pyongyang, while North Korea has remained vague about how it might denuclearize, despite earlier pledges to do so.
It said last week it would cancel the proposed summit if Washington continued to pressure it to "unilaterally" abandon its nuclear weapons program.
"Mr. Moon will stress [to Mr. Trump] that the US should not push a one-sided denuclearization of North Korea by demanding it first dismantle nuclear weapons in return for compensation later," said Yang Moo-jin, a professor at the University of North Korean Studies in Seoul.
"Mr. Moon will probably tell Mr. Trump that what Kim Jong Un wants is to be treated as a normal leader of a normal nation. And they will discuss how to guarantee the Kim regime's security and how to help develop North Korea's economy."
Pyongyang has been particularly irritated by the proposal made by Mr. Bolton that North Korea should adopt the " Libya model " for denuclearization — a reference to the late Colonel Muammar Gaddafi's 2003 decision to scrap his country's fledgling nuclear program.
The very idea of the Libya model of abandoning nuclear weapons in exchange for aid is known to infuriate officials in Pyongyang, who believe that the deal paved the way for Gaddafi's overthrow and murder in 2011.
By contrast with his national security adviser, the US president last week dismissed the Libyan experience as a model for any eventual deal with Pyongyang, instead promising Mr Kim "very strong" protections if he agreed to dismantle the country's nuclear program.
Even politicians in Seoul have expressed angst over Mr. Bolton's proposal, which has long been a taboo topic.
"Because of Bolton's unreasonable talk about the Libyan model, there is now a red light in the inter-Korean and US-North Korea talks," said Woo Sang-ho, a lawmaker with the ruling Democratic party.
"Trump's talk of guaranteeing the security of the North Korean regime is the complete opposite of Bolton's Libyan solution . . . I think the momentum for talks will only return after this issue gets cleared."
Bong Young-shik, a North Korea expert at Yonsei University in Seoul, said: "Many officials in the Moon administration hate John Bolton because of [past] bitter experiences . . . He is known as a hardliner who does not work on a case-by-case basis."
Mr. Moon last month met Kim Jong Un in a landmark summit that ended with a declaration to reduce hostilities and denuclearise the Korean peninsula.
However, the exact meaning of denuclearization was never clarified and Mr. Moon now faces skepticism from the US that he over-interpreted North Korea's desire to denuclearize.
"Mr. Trump already seems concerned that Mr. Moon misinterpreted Kim Jong Un's message or intention," said Prof Bong. "Mr. Moon runs the risk of losing his credibility."
Pyongyang has long sought to sow dissension between Washington and Seoul, which have been allies since the Korean war.
Some experts have expressed fear that if the US rushes into the June 12 summit without sufficient preparation, the meeting will inevitably fail and the risk of conflict on the Korean peninsula will once again increase.
More from the Financial Times:North Korea's summit threats bode ill for nuclear dealTrump hails North Korea plan to close nuclear siteUS brushes off North Korean threats to pull out of summit
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ff6b0955afbe7c3c9a0a2288b426be28 | https://www.cnbc.com/2018/05/22/new-virtual-kidnapping-scam-targets-chinese-students-online-data.html | New ‘virtual kidnapping’ scam targeting Chinese students makes use of data shared online | New ‘virtual kidnapping’ scam targeting Chinese students makes use of data shared online
AndreyPopov | Getty Images
A warning about a "new" international scam targeting Chinese students in Australia was issued by the Australian Federal Police on May 14, 2018.
In a typical scenario, students are contacted by someone pretending to be from the Chinese Embassy or Consulate telling them that they have been implicated in a serious crime in China or Taiwan, and asking them to collaborate with investigations.
The target is told to hide themselves for a few days and cut off all contact, including with family members in China or Taiwan. The families then receive calls telling them their child studying in Australia has been kidnapped, and a ransom demand is made.
More from the Conversation: Why the victim can also become the offender in online fraudFacebook is fighting social media identity theft in India, but it's a global problemWhy we need to do more for the victims of online fraud and scams
International scams of this nature are hard to investigate, but there are things you can do to avoid falling victim to them.
Chinese and Taiwanese people have been victims of telecommunication scams like this for decades.
Crime syndicates would provide notes to their members, teaching them how to mask their caller IDs and what to say. The criminals usually collect personal information such as the student's name, birthday, university attended and where they are originally from. This information, though basic, is essential to build trust with the victims.
The scam starts in Taiwan
The first generation of the kidnapping scam started in Taiwan in the late 1990s.
Organised crime syndicates would call parents and tell them that their child had been kidnapped and demand a ransom. During the call there would be sounds in the background of someone crying and screaming, saying "Help me, Mum/Dad!" Sometimes they might have the name of name of the child and, occasionally, will have researched the background of the family. Lots of Taiwanese were caught in the scam and paid the ransom.
Since the sim cards in use at the time were usually pre-paid cards, and the mobile phones usually cloned, criminal investigation was difficult. This pushed Taiwanese Government to tighten the rules on purchasing pre-paid cards.
And then moves to China
Before too long organised crime syndicates with members from both Taiwan and China started to use this method to scam people in China.
Criminals set up their crime base on Kinmen Island (an island belonging to Taiwan located close to the Chinese mainland). From there they could connect to the signals provided by a Chinese service provider and scam people in China. Conversely, crime bases were set up in Xiamen, the China territory opposite Kinmen, using signals provided by Taiwanese service providers to conduct scams on Taiwanese people.
In both situations they could avoid being arrested as there was limited collaboration between Taiwan and China on criminal investigations. Collaboration between the two jurisdictions only began when the Chinese government realised the seriousness of the scam.
The scam comes to Australia
With the commencement of cooperation between Taiwan and China against the telecommunication scam, a number of cases were successfully cleared and suspects were repatriated between Taiwan and China for prosecution. To minimise the risk of prosecution, organised crime syndicates then moved to their operations to Eastern Europe, East Africa or Southeast Asia (including Australia, Cambodia, Indonesia, Kenya, Thailand and the Philippines) in the past few years.
Moving the call centre to a third country not only made it more difficult to investigate the crime, it also made a successful prosecution more difficult.
What is innovative in the recent scam compared with the earlier ones is that they have chosen to target international students from China and Taiwan who are away from their family. International students are more likely to be a successful target since it's harder for parents based overseas to check whether the event is real.
With the advance of technology, people are now putting more information online. At the same time, student data is a popular target for hackers and a hot product on the online black market. Criminals are able to target parents, build trust with them and persuade them the scam is real using the detailed information they have about the family and the "kidnapped" child.
In the reported cases, the students followed the instructions of the criminal syndicates and hid themselves. When concerned parents cannot get in touch with their child, they tend to believe the scam is real and pay the ransom.
The transnational character of the crime has made investigation difficult. The victims – students and parents – are in different countries and, to make progress on an investigation, the Australian authorities need cooperation with Taiwanese or Chinese authorities. As the victims are not resident in the country where the syndicate is based and from where the scam is conducted, the police in the third country are usually reluctant to collaborate.
Furthermore, members of the crime syndicates are highly mobile and it is often too late to secure evidence and arrest criminals by the time the police in Australia have received and actioned a request for investigation assistance. Or it might turn out that the call centre is not in Australia but in a third country.
With scams like this it is important to encourage reporting to the police and to raise public awareness. In this case, the Australian Federal Police, and the Chinese Embassy and the Taiwan Cultural and Economic Office in Canberra have all issued an alert to students about the scam.
Students and parents should have diverse ways of making contact with each other. For example, students could share with their parents the contact information of their close friends so that the parents have another way to contact their children. They also should have a special way or code to indicate to each other when they really are in danger.
Finally, everyone should be vigilant about securing personal data. This includes: schools securing their systems to avoid leaks of student information; students being careful not to put too much personal information online; and all parties being alert when adding new friends on social media.
Commentary by Lennon Y.C. Chang, a Senior Lecturer in Crimonology at Monash University. He is also a contributor at The Conversation, an independent source of news and views from the academic and research community. Follow him on Twitter @lennoncyc.
For more insight from CNBC contributors, follow @CNBCopinion on Twitter.
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1aee42bead07c7962a4115f916fd4e08 | https://www.cnbc.com/2018/05/22/plans-in-motion-for-missouris-largest-ever-wind-farm.html | Plans in motion for Missouri's largest-ever wind farm | Plans in motion for Missouri's largest-ever wind farm
Matt Hoover Photo | Image Source | Getty Images
Ameren Missouri has entered into an agreement to acquire, post-construction, a 400-megawatt (MW) wind farm in northeast Missouri, the power firm said Monday.
The facility will be Missouri's biggest and will be made up of 175 American-made wind turbines. An affiliate of renewable energy business Terra-Gen will build the wind farm in Adair and Schuyler counties, with ground-breaking on the project set for summer 2019. The site will generate enough energy to power an estimated 120,000 homes by 2020. The service area of Ameren Missouri, a subsidiary of the Ameren Corporation, covers 64 counties.
"We are excited to take this transformative step to bring more renewable generation to our customers," Michael Moehn, Ameren Missouri's president, said in a statement. "Adding more wind energy will help us achieve our goal to reduce carbon emissions 80 percent by 2050." The U.S. installed over 7,000 MW of wind energy capacity in 2017, according to data from the Global Wind Energy Council (GWEC), a figure that puts it behind only China in terms of new installations. As a whole, the wind industry added over 52 gigawatts of wind power last year, according to the GWEC.
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368c515f9a3aa76bde4d60195493f9f3 | https://www.cnbc.com/2018/05/22/spiking-autozone-shares-roll-completely-over-and-tank-on-cost-concerns-raised-on-earnings-call.html | Spiking AutoZone shares roll completely over and tank on cost concerns raised on earnings call | Spiking AutoZone shares roll completely over and tank on cost concerns raised on earnings call
A man walks outside an AutoZone store in Albuquerque, New Mexico.Sergio Flores | Bloomberg | Getty Images
AutoZone shares dropped 9.5 percent on Tuesday, erasing a sharp gain from earlier in the day, after worries of rising costs for the company were raised during its quarterly earnings call.
During the call, CEO William Rhodes said he expects selling, general and administrative expenses to rise between 6.5 and 7.5 percent for fiscal year 2019 as the company raises wages.
Those comments "would seem to [indicate] concerns about labor inflation and possible peak margin," Jefferies analyst Bret Jordan told CNBC in an email.
William Rhodes III, chief executive officer of AutoZone Inc., waits to begin a listening session with U.S. President Donald Trump, not pictured, Retail Industry Leaders Association, and member company chief executive officers in the Roosevelt Room of the White House in Washington, D.C.Andrew Harrer | Bloomberg | Getty Images
AutoZone's Rhodes noted the changes to the company's wages were designed to "attract and retain terrific knowledgeable AutoZoners and to make sure our wages are competitive."
Before the call, AutoZone's stock popped as much as 6.8 percent on the back of stronger-than-expected earnings. The company's profit for fiscal third quarter totaled $13.42 per share, well above a Reuters forecast of $12.94.
But the stock post its biggest one-day fall since Feb. 27, when it dropped more than 11 percent.
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349f111cc410f26fe9888b14cabe083b | https://www.cnbc.com/2018/05/22/stealth-slowdown-means-stocks-are-cruising-to-a-bruising-ex-bull.html | 'Stealth slowdown' means Wall Street is 'cruising to a bruising,' ex-super bull warns | 'Stealth slowdown' means Wall Street is 'cruising to a bruising,' ex-super bull warns
VIDEO1:4601:46Wall Street ignoring ‘stealth slowdown’ in economy, warns former super bull Trading Nation
A veteran economic forecaster and self-described former super bull is telling investors not to get too comfortable with the stock market's latest rally.
Economic Cycle Research Institute co-founder Lakshman Achuthan warned on CNBC's "Trading Nation" that an economic slowdown is already here — suggesting that Wall Street is dangerously optimistic right now.
"There's some tension here between what's going on with the economy outside your window and what's going on with expectations on Wall Street," Achuthan said Monday. "There is a stealth slowdown already happening."
He provided a chart that showed real consumer spending and income growth "rolling over."
"Since late last year, consumer spending growth has been easing, as has personal income growth," he noted. "That points to a fresh softening in a big part of the U.S. economy."
That's not the only bearish trend in the chart, according to Achuthan.
"Spending is outpacing income growth," he said. "That puts a lot of pressure on consumers, especially if interest rates are starting to rise."
His thoughts came as the Dow was rallying to close above the 25,000 mark for the first time since March. The index is now positive for the year. The also had a strong day, settling up 0.74 percent on Monday for its best day since May 10.
Achuthan wasn't sure when Wall Street could begin taking the economic sluggishness more seriously. But he still concluded that stocks are "cruising for a bruising right here."
"From an economic cycle risk point of view, the risk is rising," Achuthan said. "We have further slowing to go."
VIDEO5:0205:02Economic cycles expert details slowdown investors may be missingTrading Nation
Disclaimer
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aa2f12bea5497fc8227aa17fa70e82df | https://www.cnbc.com/2018/05/22/stocks-making-the-biggest-moves-after-hours-rrgb-tcs-more.html | Stocks making the biggest moves after hours: Red Robin, The Container Store and more | Stocks making the biggest moves after hours: Red Robin, The Container Store and more
Getty Images
Check out the companies making headlines after the bell:
Red Robin Gourmet Burgers stock plunged more than 16 percent after the bell, after the burger chain missed on top and bottom lines in the first quarter. Red Robin reported EPS of 69 cents on $422 million in revenue versus the 76 cents on $427 million analysts were expecting, according to Thomson Reuters. The company also says same store sales fall 0.9 percent year-over-year.
Shares of The Container Store lost more than 11 percent in extended trading. The specialty retailer reported a fiscal fourth-quarter loss of $399,000, after reporting a profit in the same period a year earlier, according to the Associated Press. Prior to posting its financial results, The Container Store was trading up 8 percent after several days of steady gains.
Shares of Urban Outfitters spiked after the bell, before paring gains and falling nearly 3 percent. The clothing and lifestyle retailer, and parent company of such brands as Free People and Anthropologie, beat on earnings and revenue in the first quarter. Urban also reported a 10 percent increase in retail segment comparable sales and a 13 percent increase in wholesale comparable sales. Despite the loss, shares of the retailer are up 17.5 percent year-to-date.
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