DIRS.INFO The most relevant business & tech news

☆ A glut of cheap Chinese goods is flooding the world and stoking trade tensions
▼ + stars: | 2024-03-28 | by ( Hanna Ziady | Laura He | ) edition.cnn.com time to read: +8 min

The oversupply of Chinese goods in key industries is stoking tensions between the world’s biggest manufacturer and its major trading partners, including the United States and the European Union. From clothes to carsChina’s exports of low-priced goods got a boost after it joined the World Trade Organization (WTO) in 2001. “What China exports is advanced production capacity that meets the needs of foreign customers,” Xinhua News Agency wrote. US President Joe Biden recently pledged to investigate whether imports of Chinese vehicles pose a national security threat. “But perhaps more importantly, persistent oversupply and low prices of Chinese goods will add to geopolitical tensions and keep the threat of tariffs and counter-tariffs alive,” she wrote in a recent note.

Persons: Hong Kong CNN —, ” Jens Eskelund, Xi Jinping, Huang Jingwen, ” Eskelund, Brad W, ” Markus W, Voigt, China’s BYD, Warren Buffett, Setser, Li Qiang, “, ”, Joe Biden, Jennifer McKeown, Shawn Deng Organizations: Hong Kong CNN, European Union, European Union Chamber of Commerce, Zero, of, People, China’s National Bureau of Statistics, Council, Foreign Relations, World Trade Organization, Aream Group, Tesla, Getty, China Development Forum, Xinhua, Agency, ., EV, European Commission, WTO, Capital Economics Locations: Hong Kong, United States, China, Europe, Beijing, Xinhua, China's Shandong, . Washington, Brussels

☆ Mexico tops China as the leading exporter of goods to the US
▼ + stars: | 2024-02-07 | by ( Elisabeth Buchwald | ) edition.cnn.com time to read: +1 min

New York CNN —For the past two decades, the United States imported more goods from China than all other nations. Mexico is now the top exporter of goods into the US, according to new trade data released by the Commerce Department on Wednesday. Mexico sent $475.6 billion worth of goods into the US last year, a 5% increase from 2022. China, meanwhile, exported $427.2 billion worth of goods to the US last year, a 20% slump from 2022. That’s the largest annual decline in the trade deficit since 2009.

Persons: Matthew Martin, Brad Setser, Trump Organizations: New, New York CNN, Commerce Department, —, Oxford Economics, Council, Foreign Relations Locations: New York, United States, China, Mexico, US

☆ Is China really dumping Treasury bonds and sending yields higher? A former US official explains the mystery
▼ + stars: | 2023-10-06 | by ( Filip De Mott | ) www.businessinsider.com time to read: +4 min

China is not actually dumping its stockpile of US bonds, former Treasury official Brad Setser wrote. A large part of China's holdings are not accounted for in official US data, he said. While it has sold some Treasurys, Beijing has also bought up US debt in the form of agency bonds. Agency bonds are issued by government-sponsored enterprises, and some of the top issuers are US-backed firms like Fannie Mae and Freddie Mac. During 2022 and the first six months of 2023, China purchased over $100 billion agency debt and sold just $40 billion in Treasurys, he estimated.

Persons: Brad Setser, —, Torsten Sløk, Setser, Belgium's, China's, Fannie Mae, Freddie Mac Organizations: Treasury, Service, Council, Foreign Relations, Apollo, Treasury International Capital, Foreign, Administration of Foreign Exchange, Agency Locations: China, Beijing, Treasurys

☆ Choppy waters as Europe navigates China-US rivalry
▼ + stars: | 2023-10-04 | by ( Mark John | ) www.reuters.com time to read: +6 min

The fracturing of the rules and bonds tying the global economy together - so-called "geo-economic fragmentation" - seemed implausible only a few years ago. Nowhere is it more pressing than for Europe, whose wealth has always relied on trade, from its rapacious colonial history through to its reinvention as self-styled champion of WTO rules. Both the United States and Europe have been hardening their stance towards Beijing while stressing the rules of world trade must be fairly applied. The main EU concern is that the U.S. proposals could break WTO rules by discriminating against third parties. "And we really hope ... that after the election in the United States this is going to continue."

Persons: Jon Nazca, Gordon Brown, Brown, Brad Setser, Biden, Joe Biden, Donald Trump, Trump, Wang Huiyao, Petra Sigmund, Philip Blenkinsop, Joe Cash, Belen Carreno, Mark John, Catherine Evans Organizations: Triple, Majestic, APM, REUTERS, Trade Organization, USA, International Monetary, European, Reuters, for, Thomson Locations: Algeciras, Spain, China, Europe, America, American, United States, Moroccan, Marrakech, Beijing, Washington, Brussels, U.S, EU, for China, IMF, Madrid

Reuters Image Acquire Licensing RightsReuters Image Acquire Licensing RightsReuters Image Acquire Licensing RightsTo be sure, Japan and China are still forces to be reckoned with. But they don't bestride the Treasuries market like they once did, nor does the threat of them selling strike the same fear into bond investors, global markets at large, and even policymakers in Washington. China's Treasuries holdings fell a valuation-adjusted $34 billion in the first half of the year, although its U.S. agency debt holdings rose nearly $20 billion. Reuters Image Acquire Licensing RightsReuters Image Acquire Licensing RightsWith U.S. bond yields at their highest since the late 2000s, the widening yield gap is pushing the yuan and yen to historically low levels against the dollar. Speculation is rising that Beijing or Tokyo could soon dip into their Treasuries holdings to fund dollar-selling intervention in the currency market.

Persons: Kim Hong, Brad Setser, Carol Bertaut, Ruth Judson, Judson, Jamie McGeever, Jonathan Oatis Organizations: South Korean, REUTERS, Rights, Treasuries, . Treasury, Federal Reserve, Reuters, of Foreign Relations, Treasury, U.S, Bank of America, Thomson Locations: Rights ORLANDO , Florida, Japan, China, Belgium, Britain, Washington, Foreign, U.S, Beijing, Tokyo

☆ World Bank’s green overhaul is slowly taking shape
▼ + stars: | 2023-08-21 | by ( Rebecca Christie | ) www.reuters.com time to read: +7 min

BRUSSELS, Aug 21 (Reuters Breakingviews) - To step up the fight against climate change, World Bank President Ajay Banga wants to overhaul the lender’s balance sheet without overturning its credit rating. Earlier this year, the World Bank pledged $50 billion over 10 years via changes to how it manages its equity to loan ratio. Such backing has been used before, for example by the UK to fund $1 billion of World Bank projects in India. The central banks would hold those bonds as liquid reserves, while the World Bank could use the SDRs for financing its operations. All of these options are more complicated than if the World Bank’s shareholders simply increased its paid-in capital outright.

Persons: Ajay Banga, Janet Yellen, Lawrence Summers, N.K, Singh, Joe Biden, Yellen, ”, Guarantors, Brad Setser, Stephen Paduano, George Hay, Francesco Guerrera, Streisand Neto Organizations: Reuters, World, Treasury, World Bank, Reuters Graphics, Mastercard, Citigroup, AAA, U.S, Bank, London School of Economics, International Monetary Fund, European Union, U.S ., Thomson Locations: BRUSSELS, U.S, Asia, Banga, India, Japan, China, European, Marrakech, Singh

☆ China is hiding key data to pretend its economy is doing OK. It's not.
▼ + stars: | 2023-08-16 | by ( George Glover | ) www.businessinsider.com time to read: +2 min

China is hiding unflattering data, with its economy struggling. The National Bureau of Statistics didn't report youth unemployment numbers this month. The National Bureau of Statistics said Tuesday it would stop releasing youth unemployment numbers, after joblessness among 16-to-24 year olds spiked to 21% in June. China's economy could be a "ticking time bomb", the President told a fundraiser event in Utah, adding that "when bad folks have problems, they do bad things." Those measures could help jumpstart China's struggling economy – but trying to turn off the bad news tap will not.

Persons: Brad Setser, Joe Biden, jumpstart Organizations: National Bureau, Statistics, Financial Times, Service, National Bureau of Statistics, Treasury Locations: China, Beijing, Wall, Silicon, Japan, Utah, China's

☆ Why tiny homes could be a big deal
▼ + stars: | 2023-08-06 | by ( Matt Turner | ) www.businessinsider.com time to read: +6 min

It's easy to look at these tiny homes as undersized gimmicks, but there are real use cases. Others are leaning on tiny homes to house homeless veterans. Denver changed its zoning laws to make ADU construction easier, allowing two-story units in some parts of the city. Tiny homes won't fix that, but innovation in zoning and construction, taken with recent data pointing to a surge in residential construction, offer reasons for hope. Why tiny homes could be a big dealThis first appeared in the Insider Today newsletter.

Persons: Joyce Higashi, Katie Sandoval, Clark, Maggie, John Randolph, crumbles Karl Maasdam, Lawrence D, Thornton, Rebecca Zisser, Francesca Gino, Gino, she's, Read, Morgan Stanley, Arantza Pena Popo, Who's, James Gorman, Ted Pick, Morgan Stanley copresident, Insider's Hayley Cuccinello, Pick, Andy Saperstein, Ted Pick Big, Tyler Le, Brad Setser, Tess Turner, Stack, coders, — Jasmine Hyman, Doc Martens, Matt Turner, Hallam Bullock, Lisa Ryan Organizations: Service, Harvard, Big Pharma Locations: Wall, Silicon, California, San Jose, New Hampshire, Denver, Austin's, New York City

☆ Trick That Helps Big Pharma Companies Avoid Paying Billons in US Taxes
▼ + stars: | 2023-08-03 | by ( Brad Setser | Tess Turner | ) www.businessinsider.com time to read: +11 min

But take a look at the corporate disclosures of America's largest pharmaceutical companies, and a puzzling hole opens. Large legal loopholesThe offshore migration of these pharmaceutical companies' profits may seem egregious, but the tax gymnastics are generally legal. On paper, America's corporate-tax rate is 21%, but the country's largest and most profitable pharmaceutical companies don't pay anything close to that. What's more, the superlow rate enjoyed by American pharmaceutical companies isn't necessary for these firms to be internationally competitive. A spoonful of medicine to make the taxes go downAmerica's pharmaceutical companies have made great contributions to medicine.

Persons: Democratic Sen, Ron Wyden, AbbVie, it's, Keytruda, Gilead, Eli Lilly, they've, Brad W, Whitney, Tess Turner Organizations: Merck, National Institutes of Health . Pharmaceutical, Democratic, Pfizer, US pharma, US Treasury, Trump, Treasury, US, Denmark's, Nordisk, Novartis, National Institutes of Health, Whitney Shepardson, Council, Foreign Relations Locations: Oregon, America, Caribbean, Europe, Bermuda, Puerto Rico, Germany, Ireland, Singapore, Switzerland, Belgium, Denmark

In some ways, China and Japan are joined at the hip. As beggar-thy-neighbor foreign exchange depreciation pressures bubble up across Asia, the attraction of a weaker exchange rate grows. In terms of bilateral trade between China and Japan, the attraction is equally clear. China is Japan's largest trading partner, Japan is China's third-largest individual nation trading partner, and bilateral trade is worth around $370 billion annually. Remarkably, the yen has depreciated 25% against the yuan over the last three years, giving corporate Japan a substantial competitive advantage over China Inc.

Persons: Steven Englander, Brad Setser, Jamie McGeever Organizations: Reuters, U.S, Asian Development Bank, Standard Chartered, Finance, Bank for International, China Inc, of Foreign Relations, Thomson Locations: ORLANDO, Florida, Japan, China, Asia, East Asia, Beijing

☆ Can China Export Its Way Out of Its Economic Slump?
▼ + stars: | 2023-06-28 | by ( Keith Bradsher | ) www.nytimes.com time to read: +1 min

Thailand and other Southeast Asian nations exported their way out of economic trouble after the Asian financial crisis in 1997 and 1998. Ireland and Spain did the same after the global banking collapse in 2008 and 2009. Yet China could invite political blowback from countries worried that a flood of exports could erode their own economies, costing workers their jobs and companies their market share. And China’s close partnership with Russia, a country now reviled across much of Europe for its invasion of Ukraine, has caused alarm in Europe about the continent’s reliance on China. But there is also a practical challenge for China: Its trade surplus in manufactured goods is so large — equal to a 10th of the entire Chinese economy, by Mr. Setser’s calculations — that it may be hard to expand it further.

Persons: Deborah Elms Organizations: Asian Trade Center Locations: Thailand, Ireland, Spain, Greece, China, Europe, Russia, Ukraine, Southeast Asia, Singapore

☆ Opinion | The Woman in Charge of Saving Turkey’s Economy
▼ + stars: | 2023-06-12 | by ( Peter Coy | ) www.nytimes.com time to read: +1 min

When all hope is lost, hire a woman to take over (and take blame). Studies of the so-called glass cliff have found that companies are more likely to bring women on as chief executives or directors when business is bad. Now there’s Hafize Gaye Erkan, a former Wall Street banker who has been named the new central bank governor of Turkey. It “has consistently supported Ukraine politically and militarily without alienating Russia economically,” Yevgeniya Gaber, a nonresident senior fellow at the Atlantic Council in Turkey, wrote recently. Turkey also has the world’s 19th-largest economy, with a gross domestic product of nearly $1 trillion a year, according to the World Bank.

Persons: Linda Yaccarino, Hafize Gaye Erkan, Brad Setser, ”, “, Yevgeniya Organizations: Wall Street, Council, Foreign Relations, Central Bank of, NATO, Atlantic Council, World Bank, International Monetary Fund Locations: Turkey, Republic of Turkey, Ukraine, Russia

☆ Big Pharma Is Avoiding Taxes, and Trump’s Tax Reforms Made It Worse - The New York Times
▼ + stars: | 2023-05-12 | by ( Paul Krugman | ) www.nytimes.com time to read: +1 min

On Thursday, Brad Setser of the Council of Foreign Relations — esteemed by cognoscenti for his forensic analyses of balance of payments data — testified to a Senate committee about global tax avoidance by pharmaceutical companies. This issue may not have loomed large on many people’s radar screens, and with everything else going on you may wonder why you should care. About pharma: The U.S. health care system, unlike health systems in other countries, isn’t set up to bargain with drug companies for lower prices. In fact, until the Biden administration passed the Inflation Reduction Act, even Medicare was specifically prohibited from negotiating over drug prices. As a result, the U.S. market has long been pharma’s cash cow: On average, prescription drugs cost 2.56 times — 2.56 times — as much here as they do in other countries.

☆ Credit Suisse reinforces Japan’s offshore anxiety
▼ + stars: | 2023-03-21 | by ( Pete Sweeney | Thomson Reuters | Asia Economics Editor Pete Sweeney Joined Reuters Breakingviews In Hong Kong In September Previously He Served As Reuters' Chief Correspondent For China Economy | ) www.reuters.com time to read: +4 min

HONG KONG, March 21 (Reuters Breakingviews) - The crisis at Credit Suisse has traders wondering who’s next. Japanese lenders, with their staid depositor bases, look like unlikely targets for bank runs. Yet the rising cost of short-term dollar and euro credit, combined with extreme yen volatility, have made hedging much more expensive. Domestic commercial lenders alone held $600 billion of international debt securities at the end of 2022, and some look overexposed. Take Japan Post Bank (7182.T), a $32 billion institution whose parent is partly owned by the Ministry of Finance.

☆ Analysis: Cash-strapped countries face IMF bailout delays as debt talks drag on
▼ + stars: | 2023-03-02 | by ( Jorgelina Do Rosario | ) www.reuters.com time to read: +7 min

IMF funding is often the sole financial lifeline available to countries in a debt crunch, and key to unlocking other financing sources, with delays putting pressure on government finances, companies and populations. Though staff agreements can be reached without financing assurances, the IMF board needs them to approve the programme. Chinese Premier Li Keqiang said on Wednesday the country is willing to "constructively" participate in solving debt problems of relevant countries under a multilateral framework. But Beijing has always emphasised all creditors should follow the principle of "joint action, fair burden" in debt settlements. Adding another layer of complexity to these debt talks, the Common Framework doesn't lay out precise rules on how a debt restructuring with bilateral creditors should work.

ORLANDO, Fla., Feb 22 (Reuters) - Although China's selling of U.S. Treasury securities over the past year raises multiple geopolitical questions, it's merely switching to other dollar bonds - casting doubt about a more alarming strategic investment shift. Beijing's stash of U.S. government bonds ended last year at $862.3 billion, the lowest since May, 2010, according to Refinitiv data. Meanwhile, China's holdings of U.S. agency bonds last year rose by $50.9 billion and valuation effects accounted for $34.8 billion. This means the real increase was $85.9 billion, substantially more than the decline in Treasuries holdings. "Maybe the big story is there is no sign that China's dollar holding portfolio has changed much.

Japan's 10-year bond yield, trading at 0.4%, fell on Wednesday but is not far off its highest levels since 2015. Total holdings of foreign bonds by Japanese institutional investors, excluding Japan's $1 trillion reserve portfolio, reached $3 trillion at their peak. GOING HOMEThe implications of higher inflation and a possible end to ultra-low rates are not lost on Japanese investors. Still, anticipating a shift, Japanese investors sold a net 2.1 trillion yen ($15.94 billion) of foreign bonds in December, marking a fourth straight month of selling. According to Nomura, Japanese investors have been far more active buyers of global and overseas equities than domestic stocks in the last decade.

Japanese investors hold a lot of foreign bonds - some $4.3 trillion in various debt instruments, of which $2.085 trillion is "portfolio investments." Around half of that is in U.S. assets such as Treasuries, agency debt and corporate bonds, and around a third in euro zone securities. Wholesale liquidation of Japanese investors' foreign bond holdings is unlikely barring a "very substantial" rise in Japanese yields from here. chartLast year, Japanese investor selling picked up pace as U.S. and euro zone borrowing costs rose. Hedged investors have cut back their exposure to foreign bonds, particularly banks and now life insurers, according to Setser and Etra.

☆ Debt ceiling fights aren’t new. The next one could unleash ‘Armageddon’
▼ + stars: | 2022-10-29 | by ( Julia Horowitz | ) edition.cnn.com time to read: +6 min

Fears are brewing that a showdown between Republicans and President Joe Biden over the debt ceiling in 2023 could present a similar moment of reckoning. “The debt ceiling is probably the biggest institutional quirk in the US that carries with it some global risk and risk to the Treasury market,” Setser said. While brinkmanship over the debt limit has become commonplace, the stakes could be higher now that financial markets are on edge. “If the US does not raise its debt ceiling and defaults on its debt, that is an Armageddon moment,” Day said. Yellen told CNN that it’s “utterly essential” that the debt ceiling is raised when necessary.

Search resuls for: "Setser"

19 mentions found