U.S. consumer confidence, home prices, and the trade deficit all improved, according to economic reports published Tuesday.

Consumer confidence hit a 16-year high, as consumers said they were more confident about getting or keeping jobs and the economic outlook in general. The Conference Board said its index jumped more than nine percentage points in March.

Experts track consumer attitudes for clues about the consumer spending that drives most U.S. economic activity.

A separate report by S&P Case-Shiller showed home prices rose sharply over the past 12 months, increasing at the fastest pace since July 2014.  Some buyers may have speeded up home purchases to avoid further expected interest-rate hikes.  Experts say prices are rising in part because demand for homes is outstripping the supply.

In a separate report, the Census Bureau said the trade deficit shrank as imports dropped sharply. The deficit means that U.S. consumers buy more from foreign companies than Americans are selling to customers abroad.
…

Ford Motor Co. is investing $1.2 billion in three Michigan facilities, including an engine plant where it plans to add 130 jobs.

President Donald Trump, who has pressured automakers to invest more and create jobs in the U.S., applauded the move Tuesday in an early morning tweet.

“Big announcement by Ford today. Major investment to be made in three Michigan plants. Car companies coming back to U.S. JOBS! JOBS! JOBS!,” Trump tweeted hours ahead of the announcement.

The investments were in the works well before Trump took office, however. Ford announced plans to upgrade some of its Michigan plants in November 2015 as part of a new contract with the United Auto Workers union.

Ford Americas President Joe Hinrichs said the company told the White House about the investments Tuesday morning. Hinrichs said it’s not unusual for the company to reach out to state and national political leaders before such an announcement.

Hinrichs said Tuesday’s announcement was timed to a state meeting where officials approved nearly $31 million in grants and 15-year tax exemptions for Ford.

Ford will spend $850 million to upgrade the Michigan Assembly Plant next year to build the Ford Ranger midsize pickup and Ford Bronco SUV. Ford plans to build the Ranger starting at the end of 2018 and the Bronco starting in 2020.

The suburban Detroit plant currently makes small cars, which are moving to a plant in Mexico. Trump has needled Ford and other automakers in the past about plans to move small car production to Mexico. Amid slowing sales of smaller vehicles, Ford did scrap plans for a brand new plant in Mexico, but will continue to build small cars at an existing facility there.

Hinrichs said the Michigan Assembly Plant will operate on two shifts unless demand dictates that a third shift be added. The plant used to operate on three shifts, but it cut a shift and 673 factory workers in 2015 because of slumping sales of small cars.

Ford will spend $150 million to upgrade its Romeo Engine Plant outside Detroit. The company says it will create or retain 130 jobs at that plant, which will make components for a new engine.

Ford also is spending $200 million on a data center that will store information collected from self-driving and connected cars. The data center will be located at an assembly plant in the Detroit suburb of Flat Rock. Ford announced in January that the Flat Rock plant would get $700 million in upgrades and 700 new jobs to make electric and self-driving cars.

Ford shares rose 2.2 percent to $11.71 in afternoon trading.
…

Online retailer Amazon has announced another move into a traditional brick and mortar business, drive-up grocery stores.

The company announced the AmazonFresh Pickup service Tuesday, according to CNBC. The service, which is currently only available to Amazon employees, would allow Amazon Prime members to order groceries online, choose a pick up time and pick them up at that store.

The service would allow customers to select fruits, vegetables, breads, dairy and meats among other items. Pick up times can be made as soon as within 15 minutes of placing an order.

Amazon also offers a grocery delivery service to certain parts of the United States.

AmazonFresh Pickup is the latest move for the company, which is also reportedly considering furniture and home appliance showrooms, according to the New York Times.

The company is also experimenting with convenience stores without cashiers.

 
…

Indonesia has the world’s fourth-largest population at almost 260 million, but only 10 percent are registered as taxpayers and only about one million actually submit a tax return. That’s a major reason for the country’s huge and growing deficit, which has stalled the present administration’s ambitious infrastructure plans.

To jump-start the recovery of assets that wealthy Indonesians sequester abroad, the country launched a tax amnesty program in the summer of 2016. It was an experiment that drew criticism from the likes of OECD, the IMF, and domestic labor unions. Still, as it enters the final days of its nine months, the program has exceeded monetary expectations, netting about $330 billion of tax revenue.

The big question, once it wraps up on March 31, is what to do with that money. Finance Minister Sri Mulyani has created a task force to address the repatriated assets, but they can only really start their work after the final numbers are released. The government must also respond to criticism that the amnesty program lets off tax evaders too easily, to the detriment of the working class.

Closing the deficit

“The revenue from this will significantly contribute to reducing the national deficit,” said Asmiati Malik, an economics researcher at the University of Birmingham. “It could do so by as much as 70 percent: from $23 billion to $8.2 billion.”

In recent weeks, regional tax offices have put on daily public campaigns to encourage participation in the amnesty program. Hestu Yoga Saksama of the Taxation Directorate General told the Jakarta Post as many as 4,000 people signed up for it every day in March that as many as 4,000 people signed up for it every day in March, suggesting it arose from a general tendency to procrastinate on personal finances.

“In our culture, people tend to wait until the very last moment,” said Yoga.

Over three million Indonesians have become new tax payers in the last year, according to the Directorate General of Taxation. This includes high profile business people like those of the Indonesian Chambers of Commerce and Industry, a business lobby, who signed up en masse earlier this year.

Since the 1990s, when there were ethnic riots and political unrest before and after the fall of long-time dictator Suharto, rich Indonesians have relocated money to tax havens like Singapore, according to Bloomberg.

“Two huge benefits of the amnesty program for taxpayers now are the low interest rate and the abolition of tax debt,” said Yustinus Prastowo of the Center for Indonesia Taxation Analysis.

If they repatriate assets, individuals will be charged between two and ten percent interest, rather than typical corporate or personal income tax rates, which can reach 30 percent. And they must commit to keeping those assets within Indonesia for at least three years.

Expanding the tax base

Indonesia has already generated more revenue from its tax amnesty experiment than analogous efforts in countries like India and Germany, but according to some experts, there remains room for expansion.

“The major issue is that the number of taxpayers who joined the amnesty program is still low, proportionally,” said Malik. “There are roughly 700,000 people who joined the program out of a total 32 million taxpayers… which is only 2.2 percent of those eligible.”

Malik called for a more progressive tax policy to increase participation in both the amnesty program and taxation in general. “It should be more progressive regarding extensification [widening the tax base], and increase the incentive for tax compliance and avoidance,” she said. “These solutions hinge on using ‘one-gate identification’ that integrates a person’s bank account, national ID, and tax ID, so that no one can avoid declaring their assets.”

That being said, the first round of the amnesty program is well-timed; by September of this year, Indonesia will join the Organization for Economic Cooperation and Development’s Automatic Exchange of Information initiative to share its tax figures internationally. That means it will be able to access the details of Indonesian citizens’ offshore assets in countries like Singapore and the Cayman Islands.

Rising inequality

The OECD, however, was an early critic of Indonesia’s project of tax amnesty. Programs like this are “unlikely to deliver benefits that exceed their true costs, but carry a risk of leading to an erosion of the gross revenue collected and may negatively affect overall tax compliance,” Philip Kerfs, of OECD’s Centre for Tax Policy and Administration, told Bloomberg in August 2016.

Opponents of the program argue that tax evaders are essentially rewarded for flouting the law.

Last fall, there were large worker protests in Jakarta against tax amnesty, and most of the country’s labor unions have vocally opposed the policy.

The International Monetary Fund also expressed doubts about the program. “We were a little skeptical with the implementation of tax amnesty anywhere, but we hope we are wrong in Indonesia,” said IMF’s Luis Bereu.

On Monday, the Directorate General of Taxation announced it was devoting “special attention” to pursuing several members of a Forbes list of the richest Indonesians who have not yet registered for tax amnesty.

 

 

Prastowo suggested another reason why the funds may eventually fall short of their potential — the hardline rallies that gripped Jakarta last November and December, against the city’s Chinese Christian governor. The political disturbance, he said, may have deterred investors from bringing their money back home. It’s a remarkable parallel to the unrest that sent many wealthy Indonesians packing in the first place.
…

Turkish and Gulf airlines are touting free WiFi and better in-flight connectivity for smartphones as they scramble to mitigate the impact of a ban on laptops in plane cabins bound for the United States.

The restrictions could deal a blow to fast-growing Gulf airlines, which depend on business-class flyers stopping over in Dubai or Doha for far-flung destinations, and to Turkish Airlines with its high volume of transit passengers.

A Turkish Airlines official said it was working on rolling out a system to allow passengers to use 3G data roaming on mobile phones to connect to the internet in-flight, and planned to make WiFi freely available on some aircraft from next month.

“We’ve sped up infrastructure work after the latest developments. … If the work is complete, we’re planning on switching to free WiFi services in our Boeing 777 and Airbus 330 aircraft in April,” the official told Reuters.

Emirates said Thursday it was introducing a “laptop and tablet handling service” for U.S.-bound flights which would allow passengers to use their devices until just before they board. The devices would be “carefully packed into boxes” and returned on arrival in the United States, it said.

Emirates passengers can access limited free WiFi or pay $1 for 500 MB.

Fellow Gulf carrier Etihad encouraged passengers to pack their electronics in check-in luggage but said it would also allow devices to be handed over at boarding, a spokesman said. Turkish said it had introduced a similar measure.

Qatar Airways did not respond to questions on how it planned to mitigate the impact of the new security measures, but in a Facebook posting this week it said its in-flight entertainment was “the only entertainment you’ll need on board.”

Royal Jordanian also took a tongue-in-cheek approach, listing on Twitter “12 things to do on a 12-hour flight with no laptop or tablet,” including reading, meditating, saying hello to your neighbor, or “reclaiming territory on your armrest.”
…

In New York, the Dow Jones Industrial Average fell for the eight consecutive day on Monday.  Investors may have been discouraged by the failure of U.S. President Donald Trump to pass big changes to the health care insurance system that he promised during the campaign.

U.S. stock indexes were down sharply in morning trading, but by Monday’s close, the S&P 500 was off just one-tenth of a percent, with the Dow down two-tenths.  The NASDAQ posted a slight gain.

U.S. and other stocks had been mostly rising since the November election on business hopes that promised cuts in taxes and regulation and a boost in spending on public works would stimulate the economy and boost profits.

Now investors are worried that the inability of the Republican president to get support from his Republican-controlled Congress means he will struggle to deliver promised changes on other complex and controversial efforts.

Later this week, government officials will report new data on growth of the U.S. economy and the health of the job market.
…

Transnational crime, or crimes committed across international borders, is growing at a faster pace than many realize, partly because the international community is not paying a lot of attention to it. That’s the conclusion from Global Financial Integrity or GFI, a non-profit Washington think tank that tracks illicit financial flows across borders.

The group’s latest findings estimate that transnational crime is worth between $1.6 to $2.2 trillion per year. GFI says the lion’s share of illicitly generated funds around the globe comes from counterfeiting, worth between $923 billion to $1.13 trillion per year, followed by drug trafficking which generates between $426 to $652 billion in illegal funds annually.

“Transnational crime is a business, and business is very good,” said Channing May, author of GFI’s “Transnational Crime and the Developing World.”  Less understood, said May, are the lasting and negative consequences for governments and the economies of developing countries.  

“Very rarely do the revenues from transnational crime have any long-term benefit to citizens, communities or economies of developing countries. Instead, the crimes undermine local and national economies, destroy the environment and jeopardize the health and well-being of the public,” said May.

Rounding out the top 10

Of the top 10 illegal revenue generators around the globe, human trafficking is ranked in fourth place, generating roughly $150 billion per year, followed by illegal mining, worth upwards of $48 billion. In eighth place, crude oil theft is valued between $5 to $12 billion, and in 10th place, the trafficking of human organs may be worth as much as $1.7 billion per year.

The report says shutting down the global shadow financial system that facilitates the movement and transfer of illicitly generated funds is technically not a difficult undertaking, but rather a matter of political will.

Complete report due March 29

GFI program manager Christine Clough said recommendations include greater financial transparency and regulations requiring all corporations to declare the nature and the ultimate beneficiaries of doing business within countries.

“Networks involved in these illicit markets are akin to major global corporations: they need access to finance and banking to be profitable to continue operating,” said Clough.

The complete GFI report will be released March 29 in Washington and is based on a compilation of statistics from various government and non-governmental bodies and law enforcement sources.
…

The globally popular statue of a young girl will keep staring down Wall Street’s famed “Charging Bull” through February 2018 instead of being removed this coming Sunday, the mayor said.

She’s “standing up to fear, standing up to power, being able to find in yourself the strength to do what’s right,” said Democratic Mayor Bill de Blasio, who appeared with the “Fearless Girl” statue Monday on the lower Manhattan traffic island where the two bronze figures face each other.

The mayor said the political turmoil surrounding Republican President Donald Trump makes the endearing child particularly relevant.

“She is inspiring everyone at a moment when we need inspiration,” he said.

The 4-foot-tall, 250-pound ponytailed girl in a windblown dress was installed this month to highlight the dearth of women on corporate boards as she stands strong against the 11-foot-tall, 7,100-pound bull. The girl became an instant tourist draw and internet sensation.

On Monday morning, Democratic U.S. Rep. Carolyn Maloney, of New York, led a group of prominent women in front of City Hall to honor the artist, Kristen Visbal, and State Street Global Advisors, the asset management firm that commissioned the work and, with the McCann advertising firm, helped Visbal create her sculpture.

“She was created to bring attention to the courage and unrealized power of women in so many fields, and she has clearly struck a nerve,” said Maloney, who is pushing for the statue to become a permanent installation.

Visbal said the positive response to her artwork “renewed my faith in sculpture to make an impact on society, to create a debate the way a good piece of art should.”

She has received more than 1,000 emails from India, Denmark, Sweden, Spain and elsewhere, including one from a mother who wanted to wallpaper her daughter’s room with the girl’s image.

“I see men and women as the ying and yang of society,” Visbal said. “They bring different things to the table. They solve problems in a different way. But we need to work together.”

“Fearless Girl” will stay in place for another 11 months through an art program of the city’s Department of Transportation that manages lower Broadway near Wall Street.

Visbal said one of her models was a friend’s young daughter, whom she asked “to envision staring down a great big bull and, boy, she really had style.” The girl was white, and the creative team then incorporated another girl, a Latina, “to come up with a child that has universal appeal,” Visbal said.

The fictional figure is linked to a very real message: Women make up only about 16 percent of U.S. corporate boards, according to the ISS Analytics business research firm.

Artist Arturo Di Modica’s bull arrived after the 1987 stock market crash as a symbol of Americans’ financial resilience and can-do spirit. He wants the girl gone, calling the statue an “advertising trick” fashioned by two corporate giants, while his sculpture is “art.”
…

President Donald Trump says that empowering and promoting women in business are priorities in his administration.

 

In a round-table discussion, the president is telling a group of female business owners that his team will work on barriers women face. He says the administration is also trying to make childcare more affordable and accessible.

 

WATCH: Trump’s comments during roundtable discussion

The gathering comes on the first work day since the Republican-led plan to repeal and replace the nation’s health care law was pulled before a House vote, a major setback for the Trump administration.

 

The White House is trying to focus this week on another campaign priority: creating jobs and economic issues.
…

The Associated Press used dozens of interviews and multiple public records requests to determine that North Carolina’s “bathroom bill” will cost the state more than $3.76 billion in lost business over a dozen years.

This is how the largest elements were compiled and used:

 

PAYPAL

 

A state Commerce Department analysis shows officials expected a planned Charlotte PayPal operations center to contribute more than $200 million annually to the state’s gross domestic product — an overall measure of the economy. By the end of 2028, the state expected PayPal to have added more than $2.66 billion overall to the state economy, according to the March 2, 2016, analysis.

 

But shortly after House Bill 2 was enacted, PayPal CEO Dan Schulman announced the company was backing out of the 400-job plan because of the law.

 

The fiscal cost-benefit analysis model has been used for more than a decade when the state offers major discretionary tax breaks to attract jobs. The Job Development Investment Grant program can provide incentives for up to 12 years under state law — so the analyses are often done for that length of time. A recent annual report on the incentive program shows it’s not uncommon for the state to estimate that a company could add billions to the economy over the grant’s life.

 

DEUTSCHE BANK

 

Using the same model, the Commerce Department estimated that a Deutsche Bank project in Cary would pump about $47 million annually into the economy once fully staffed at 250 jobs in 2017. The September 2015 analysis predicted a total impact of about $543 million by the end of 2027. But the company announced it was halting plans because of the law.

 

COSTAR

 

The AP used figures from North Carolina and Virginia to conclude that CoStar’s decision not to put its facility in Charlotte will cost North Carolina at least $250 million.

 

When CoStar announced in October 2016 that it had picked Virginia for a research center employing 732 people, that state said the project’s economic impact would be $250 million based on payroll, capital investments and other factors. That number is consistent with planning documents from North Carolina that projected the company to bring the same number of jobs _ average salary, around $57,000. State economic planners expected a capital investment of $24 million, so its impact would’ve exceeded $250 million in the first half-dozen years.

 

Officials said they didn’t run the wider-ranging 12-year analysis that was used for Deutsche Bank and Paypal.

 

CoStar’s CEO had recommended Charlotte to his board and was preparing for final negotiations for a site there when the board backed out because of negative publicity over the law, according to a September 2016 email exchange between Charlotte Chamber of Commerce and city officials.

 

VOXPRO

 

The AP analysis valued Voxpro’s decision not to come to the state at about $52 million based on figures from North Carolina and an interview with the CEO.

 

The company was in negotiations to bring hundreds of call-center jobs to the Raleigh area, but chose not to because of the law, founder and CEO Dan Kiely said in an interview. The company chose Athens, Georgia; Kiely said the company will employ 500 there.

 

North Carolina’s Commerce Department projected annual wages around $29,000 for 2016-20. The project was expected to create 230 jobs in the last quarter of 2016, according to state documents. The AP used 230 jobs over three months for its 2016 calculations, and the same headcount for 2017.

 

Kiely said the company would have ramped up hiring in 2017 to bring 500 jobs to the North Carolina site. The AP used the 500-job figure for the years 2018, 2019 and 2020; that’s consistent with the company’s expectation for staffing to reach 500 workers at the Georgia site before 2020.

 

North Carolina officials said they didn’t run the wider-ranging, 12-year analysis that was used for Deutsche Bank and Paypal.

 

ADIDAS

 

The AP used figures from North Carolina and Georgia to compute a value of about $67 million for the decision by Adidas not to choose North Carolina for a factory.

 

The shoe and apparel company was considering a High Point site and visited about a week before the law passed, according to state economic development emails. They show that soon after the law passed, a top Adidas executive sought a meeting with Commerce Secretary John Skvarla to discuss the law’s implications. By late June, North Carolina Economic Development Partnership recruiter Evan Stone bemoaned that the company’s “site location decision is imminent, and High Point was the preferred site but is being rejected solely on the basis of recent legislation.”

 

The AP calculation started with North Carolina officials’ estimate that Adidas would’ve made a capital investment of $35 million, according to emails. To estimate yearly payroll, the AP used the 160 jobs it’s bringing to Georgia with an average salary of about $40,000. That payroll number was multiplied by five years _ a time period commonly used for projections during early rounds of negotiations with state officials.

 

North Carolina officials said they didn’t run the wider-ranging 12-year analysis that was used for Deutsche Bank and PayPal.

 

SPORTS, CONVENTIONS, CONCERTS

 

The AP conducted more than a dozen interviews and email exchanges with tourism officials and planners to determine the state lost more than $196 million from sporting events, conventions, concerts and other events. Cities researched include: Asheville, Charlotte, Greensboro, Raleigh, Manteo, Wilmington, Durham and Fayetteville.

 
…

U.S. economic growth is expected to accelerate this year and next, yet remain modest, even if President Trump’s promised tax cuts and infrastructure spending are implemented, a survey found.

The economy will grow a solid 2.3 percent this year and 2.5 percent in 2018, according to 50 economists surveyed by the National Association for Business Economics. Those rates would be up from 2016’s anemic pace of 1.6 percent.

Still, those rates are below the 3 percent to 4 percent growth that Trump has promised to bring about through steep corporate and individual tax cuts and more spending on roads, airports and tunnels.

Most of the economists surveyed assume that a tax reform package will be approved by Congress this year. About two-fifths expect an infrastructure spending proposal to pass this year, while rest forecast it will happen in 2018 or beyond.

The survey also found that 70 percent of economists think financial markets are too optimistic about the impact of Trump’s proposals, should they be enacted.

The S&P 500 stock index has risen about 6.5 percent since the presidential election on anticipation of faster growth stemming from Trump’s policies. Shares slipped last week as Congress and the Trump administration failed to agree on a health care proposal to replace the Obama administration’s Affordable Care Act.

The economists surveyed work for companies, trade associations and in academia. The results were compiled by Timothy Gill, an economist at the American Iron and Steel Institute; Steve Cochrane, an economist at Moody’s Analytics; and David Teolis at General Motors, among others.

The survey found economists more optimistic about hiring than they were in a previous survey, conducted in December. They now forecast employers will add an average of 183,000 jobs a month this year, up from their earlier forecast of 168,000. The new figure is roughly in line with last year’s average of 187,000.

Most of the economists assume that Trump’s tax proposals will pass in the second half of this year, though about one-fifth expect that it will take until next year.

Most do not expect an infrastructure package, even if it passes this year, to boost the economy until 2018, the survey found.

Trump’s tax proposals will face many challenges before they become law. Most economists surveyed by NABE do not expect they will include a proposal from House Republicans to tax imports and exempt exports. That proposal is forecast to raise $1 trillion in revenue over a decade. Without it, the tax plan will need to raise other revenue or will make the government’s budget deficit larger.
…

Just months ahead of local elections, the Cambodian government has ordered the microfinance industry to cap the interest rate on new loans at 18 percent a year. While borrowers will applaud that at least in the short term the decision has rocked the industry, which fears some firms will go bankrupt. The end result could be fewer small loans for villagers, who will be driven into the hands of predatory lenders. For VOA, Robert Carmichael has the story from Phnom Penh.
…

A joint committee of ministers from OPEC and non-OPEC oil producers has agreed to review whether a global pact to limit supplies should be extended by six months, it said in a statement on Sunday.

An earlier draft of the statement said the committee “reports high level of conformity and recommends six-month extension.”

But the final statement said only that the committee had requested a technical group and the OPEC Secretariat “review the oil market conditions and revert … in April, 2017 regarding the extension of the voluntary production adjustments.”

It was not immediately clear why the wording had been changed, although a senior industry source said the committee lacked the legal mandate to recommend an extension.

OPEC and rival oil-producing countries were meeting in Kuwait to review progress with their global pact to cut supplies.

The Organization of the Petroleum Exporting Countries and 11 other leading oil producers including Russia agreed in December to cut their combined output by almost 1.8 million barrels per day (bpd) in the first half of the year.

“Any country has the freedom to say whether they do or they don’t support [an extension]. Unless we have conformity with everybody, we cannot go ahead with the extension of the deal,” Kuwaiti Oil Minister Essam al-Marzouq said, adding that he hoped a decision would come by the end of April.

The oil ministerial committee “expressed its satisfaction with the progress made towards full conformity with the voluntary production adjustments and encouraged all participating countries to press on towards 100 percent conformity,” the statement said.

The December accord, aimed at supporting the oil market, has lifted crude to more than $50 a barrel. But the price gain has encouraged U.S. shale oil producers, which are not part of the pact, to boost output.

The committee said it took note that certain factors, such as low seasonal demand, refinery maintenance and rising non-OPEC supply had led to an increase in crude oil stocks. It also observed the liquidation of positions by financial players.

“However, the end of the refinery maintenance season and noticeable slowdown in U.S. stock build as well as the reduction in floating storage will support the positive efforts undertaken to achieve stability in the market,” it said.

It asked the OPEC Secretariat to review oil market conditions and come back with recommendations in April regarding an extension of the agreement.

“This reaffirms the commitment of OPEC and participating non-OPEC countries to continue to cooperate,” the statement said.

Russian Energy Minister Alexander Novak said it was too early to say whether there would be an extension, although the agreement was working well and all countries were committed to 100 percent compliance.

‘Encouraging elements’

Before the meeting, Iraqi Oil Minister Jabar Ali al-Luaibi told reporters there were some encouraging elements that suggested the oil market was improving, and that if all OPEC members agreed measures to help price stability, Iraq would support such steps.

“Any decisions taken unanimously by members of OPEC … Iraq will be part of the decision and will not be deviating from this,” Luaibi said.

Iraq’s oil production is running at 4.312 million bpd this month, Luaibi said, adding that his country had cut its oil exports by 187,000 bpd so far and would reach 210,000 bpd in a few days.

Compliance with the supply-cut deal was 94 percent in February among OPEC and non-OPEC oil producers combined, Russia’s Novak said.

Russia is committed to cuts of 300,000 bpd by the end of April, Novak said.

Novak said he expects global oil stockpiles to decrease in the second quarter of this year.

“The dynamics are positive here, I believe,” Novak said, adding that inventories in the United States and other industrialized countries had risen by less than in the past.

Kuwait’s oil minister said the market may return to balance by the third quarter of this year if producers comply fully with their production targets.

“More has to be done. We need to see conformity across the board. We assured ourselves and the world that we would reach our adjustment to 100 percent conformity,” Marzouq said.
…

U.S. Treasury Secretary Steven Mnuchin said on Friday he believes financial markets could improve “significantly” once they fully reflect the potential for U.S. economic growth from President Donald Trump’s economic policies.

Mnuchin said at an event sponsored by news website Axios that optimism about U.S. growth from policies such as regulatory reform and tax reform is “definitely not all baked in” to market valuations.

U.S. stock prices and the dollar have strengthened significantly since Trump was elected in November, largely in anticipation of corporate profits rising as regulatory burdens ease and tax rates fall. Some of those gains were retraced this week as Republicans in Congress faced stiff opposition from

conservatives in passing a bill to replace the Obamacare health law.

“I think there is some good news that’s baked in, but yet, I think there is further room for significant growth in the economy that would be reflected in the markets,” Mnuchin said. “The consequence would be that the market could go up significantly,” Mnuchin added.

Treasury secretaries in the past have shied away from publicly discussing market valuations.

But Mnuchin said Trump’s policies could produce growth of 3 percent to 3.5 percent, which is significantly higher than the fourth quarter reading of 1.9 percent.

“We’re in an environment where the U.S. assets are the most attractive assets to invest in on a global basis.”

Mnuchin said he is still aiming to achieve passage of comprehensive tax reform by the time Congress takes its August recess. He also said he expects the Trump administration’s Obamacare replacement bill to pass later on Friday.
…

The Trump administration will approve the Keystone XL pipeline Friday, senior U.S. officials say, ending years of delay for a project that has served as a flashpoint in the national debate about climate change.

 

The State Department will recommend the pipeline is in U.S. interests, clearing the way for the White House to grant a presidential permit to TransCanada to build the $8 billion pipeline, two officials said. It’s a sharp reversal from the Obama administration, which rejected the pipeline after deeming it contrary to national interests.

 

The officials, who weren’t authorized to speak publicly on the matter and demanded anonymity, said the State Department’s recommendation and the White House’s final approval would occur Friday.

The White House declined to comment, other than to say it would offer an update Friday. State Department spokesman Mark Toner wouldn’t reveal the decision, but said the agency had re-examined Keystone thoroughly after ruling against the proposed project barely two years ago.

 

“We’re looking at new factors,” Toner said. “I don’t want to speak to those until we’ve reached a decision or conclusion.”

Canada to Texas Gulf Coast

 

The 1,700-mile pipeline, as envisioned, would carry oil from tar sands in Alberta, Canada, to refineries along the Texas Gulf Coast, passing through Montana, South Dakota, Nebraska, Kansas and Oklahoma. The pipeline would move roughly 800,000 barrels of oil per day, more than one-fifth of the oil Canada exports to the U.S.

 

Oil industry advocates say the pipeline will improve U.S. energy security and create jobs, although how many is widely disputed. Calgary-based TransCanada has promised as many as 13,000 construction jobs — 6,500 a year over two years — but the State Department previously estimated a far smaller number. The pipeline’s opponents contend the jobs will be minimal and short-lived, and say the pipeline won’t help the U.S. with energy needs because the oil is destined for export.

 

President Donald Trump has championed the pipeline and backed the idea that it will prove a job creator. In one of his first acts as president, he invited pipeline company TransCanada to resubmit the application to construct and operate the pipeline. And he had given officials until next Monday to complete a review of the project.

No American steel

 

A Trump presidential directive also required new or expanded pipelines to be built with American steel “to the maximum extent possible.” However, TransCanada has said Keystone won’t be built with U.S. steel. The company has acquired the steel, much of it from Canada and Mexico, and the White House has acknowledged it’s too difficult to impose conditions on a pipeline under construction.

 

Portions of Keystone have been built. Completing it requires a permit involving the State Department because it crosses the U.S.-Canada border.

 

In an unusual twist, the agency’s recommendation won’t come from Secretary of State Rex Tillerson. The former CEO of oil company Exxon Mobil recused himself after protests from environmental groups who said it would be a conflict of interest for Tillerson to decide the pipeline’s fate.

 

Instead, Tom Shannon, a career diplomat serving as undersecretary of state for political affairs, will sign off, officials said.

Route under litigation

 

Even with a presidential permit, the pipeline will still face obstacles — most notably when it comes to the route, which is being heavily litigated in the states. Native American tribes and landowners have joined environmental groups in opposing the pipeline.

 

Environmental groups also say the pipeline will encourage the use of carbon-heavy tar sands oil which contributes more to global warming than cleaner sources of energy. President Barack Obama reached the same conclusion in 2015 after a negative recommendation from then-Secretary of State John Kerry.

 

The Trump administration has dropped fighting climate change as a priority and left open the possibility of pulling out of the Paris deal. 
…

A cluster of Black Lives Matter groups and the organization leading the push for a $15-an-hour wage are joining forces to combine the struggle for racial justice with the fight for economic equality, just as the Rev. Martin Luther King Jr. tried to do in the last year of his life.

 

They are launching their first national joint action April 4, the 49th anniversary of King’s assassination, with “Fight Racism, Raise Pay” protests in two dozen cities, including Atlanta; Milwaukee; Memphis, Tennessee; Chicago; Boston; Denver; and Las Vegas.

 

King was gunned down in 1968 while on a visit to Memphis to support striking black sanitation workers.

 

“When MLK was assassinated, he was talking to workers who were dealing with union-busting, unfair wages,” said Kendall Fells, organizing director for the Fight for $15. “The bottom line is that every day, workers of color across the country face deep-seated racism that would seem to be out of Dr. King’s era, but sadly it’s still happening today.”

 

New political reality

Fells said the new political reality requires the groups to band together. After President Donald Trump’s election, some civil rights and social justice organizations are taking an all-hands-on-deck approach against an administration they see as hostile to the working poor and minorities.

 

By working together, the two groups can reach more people and amplify their messages, activists say.

 

“What we both realize is we’re stronger when we operate together,” Fells said. 

United in Ferguson

Fight for $15 has helped raise the minimum wage in places like New York and Washington. The Black Lives Matter movement grew largely out of the protests over the fatal shooting of Michael Brown by a white officer in Ferguson, Missouri, in 2014. The organization has demanded police reforms and an end to killings of unarmed black people.

Fight for $15 and Black Lives first came together in Ferguson. The nearly all-black workforce at the neighborhood McDonald’s had been on strike before Brown was killed. After Brown’s death, those workers used their organizing skills to protest police department practices.

 

In a controversial 1967 speech titled “Beyond Vietnam,” King made a radical shift in his message, speaking out about the triple evils of war, racism and capitalism and linking economic and racial inequality. That same year, the civil rights leader launched his Poor People’s Campaign to address disparities in employment and housing.

 

“We’re not simply remembering his assassination,” said the Rev. William Barber II, who will lead the Memphis protest. “We’re remembering why he was there and reimagining that for the 21st century. Dr. King was connecting black and white poverty and saying black and white poor people need to be allies.”

Broadening the coalition

 

Asha Ransby-Sporn, national organizing chair with the Black Youth Project 100, one of dozens of Black Lives groups that are taking part in the protests, said police harassment and the routine treatment of blacks as criminals are among the biggest barriers to economic justice for black Americans.

 

Broadening the coalition, as King attempted, is important, she said.

 

“We can’t fight on any of these fronts without fighting on all of them,” Ransby-Sporn said.

 

Terrence Wise, a $9.50-an-hour McDonald’s employee and Fight for $15 organizer in Kansas City, Missouri, plans to take part in the April 4 protest there.

 

“It’s one thing to be able to make a living wage, but to go home from work and be harassed by the police or treated differently in our communities, or discriminated against in the workplace … I need to be treated as a human being,” Wise said. “They’re one and the same fight.”
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New data show U.S. home sales advanced in February while job layoffs rose slightly last week.

Thursday’s Commerce Department report showed home sales rose 6.1 percent to hit a seven-month high in February. If newly-constructed homes sold at last month’s pace for a full year, 592,000 would change hands. That is nearly 13 percent better than the same time last year.

Analysts at Wells Fargo Securities said unusually mild weather in February sped up the buying process, so the next few months may see slower sales.

The number of Americans signing up for unemployment assistance rose by 15,000 last week, according to the Labor Department. While the number of layoffs was higher, at 258,000 it is still low enough to show a healthy job market.
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The head of the U.S. central bank says new research strengthens the case for investing in early childhood education.

In a Washington speech Thursday, Federal Reserve Chair Janet Yellen said evidence shows “growing up poor makes it harder to succeed as an adult.”

A survey by Fed experts shows childhood poverty makes it less likely that people will be employed as adults, and hurts their chances of having stable jobs and adequate incomes.

Yellen says research also underscores the value of investing in workforce habits and skills like mathematics, literacy, teamwork, communication, and the ability to cope with conflict.  

She says giving kids a strong foundation will help build a stronger U.S. economy. She urged politicians to carefully consider the impact of proposed policies on the future of children and the nation.  

 
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Neda Saiyyada was among a handful of women in India whose company gave her six months of maternity leave last year instead of the mandatory three months. The extended leave helped the young mother enormously.

“When I was pregnant, my biggest worry was that I will not be able to leave my child,” she said. “In three months the child is nothing, can’t even hold the neck straight, and my child was eating and sitting up straight when I joined back, so it was a blessing in disguise.”

About 1.8 million women working in India’s formal sector will soon be legally entitled to get the extended maternity leave that Saiyyada was so grateful for after parliament passed a landmark bill earlier this month doubling maternity leave from 12 weeks to 26 weeks.

WATCH: India maternity leave

India is joining a handful of countries, such as Canada and Norway, that give women generous paid leave of six months or more.

Besides boosting maternal and child health, experts hope the longer maternity leave will encourage more women to return to work and help close a growing gender gap in a country where women account for about one-quarter of the workforce.

Women in workforce

Shachi Irde, executive director of the nonprofit Catalyst India Women’s Research Center, worried that the number of women in the workforce is not only small, it has been declining. 

“In 2004 to 2005 there were about 37 percent women in the workforce, now it has dropped to 29 percent,” she said.

Pointing out that India is the only country facing this downward trend, she said “there are many reasons, but one of them is child care.”

According to a study by the Associated Chambers of Commerce and Industry of India, 25 percent of new mothers in India quit their jobs after having their first child. And research by Catalyst shows that family responsibilities make it tougher for women to climb the career ladder: About half of working women do not go beyond junior or midlevel positions.

India has few quality child care facilities and most women fall back on the family to take care of children.

The new law tries to address that problem by making it compulsory for workplaces employing more than 50 people to set up day care facilities.

The extended leave itself also will be a huge help, said Neda Saiyyada, who added, “It will encourage women to stay connected with the workplace.”

Will hiring drop?

However some human resource professionals fear the new bill could discourage employers from hiring women, particularly small companies that would see the extended maternity leave as an additional burden.

“For businesses, it is just not easy to not have an employee for six months,” said Sairee Chahal, founder of SHEROES, a portal for women job seekers. “Instead of saying we will hire you as an employee, they will hire you for noncore roles or for more modular roles so this does not fall on them.”

She pointed out that maternity leave has been doubled at a time when the organized sector is facing multiple challenges and shorter business cycles. 

“It (companies) is also under churn of a different kind, under churn of automation, under churn of globalization. So all those trends are overpowering it at this stage,” she said.

Others say the government should also have looked at involving both parents in the extended leave period instead of only making the provision for the mother.

Caveats

But in a country that is coping with a huge population of 1.3 billion people, the 26 weeks of leave will only be given for the first two children, and women would only be entitled to 12 weeks for a third child.

The bill also brings no benefits to women working in the informal sector, which employs as much as 90 percent of the female workforce. That includes housemaids, laborers or workers in small workshops, who do not get entitlements such as paid leave.

But for the time being, those who stand to get six months off are celebrating.

Traptika Chauhan who is expecting a baby in August was “extremely, extremely relieved” when she heard about the passage of the bill. She pointed out that with more and more people staying in nuclear families, child care is a challenge for working couples.

“I don’t have my parents who stay here or my in-laws who stay here. Then it is really difficult to leave such a small baby all by himself or herself and leave for work,” she said. “Plus your own body is trying to cope up so extremely, extremely great news and perfect for me.”
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Grumbling Venezuelans were lining up for scarce gasoline across the OPEC nation on Wednesday, due to mounting oil industry woes in the country with the world’s largest crude reserves.

Venezuela, which also has the world’s cheapest gasoline, has wrestled with intermittent gasoline shortages in recent months, especially in the central coastal area.

Long lines were reported in capital Caracas, which is unusual, and the eastern city of Puerto Ordaz on Wednesday.

Dozens of cars could be seen snaking into streets and some service stations were shuttered.

“I can’t find 95 octane gasoline anywhere. And we’re an oil-producing country! It’s pathetic,” said Jose Paredes in Caracas’ wealthy Altamira district.

The waits heap extra hardship on the nation of 30 million, where many already jostle for hours in hot lines for food and medicines amid product shortages caused by a brutal economic crisis under leftist president Nicolas Maduro.

State oil company PDVSA’s new head of trading blamed the shortages on problems with internal shipping of products and vowed the issue would be solved soon.

“We’re strengthening deliveries to the center of the country to stabilize gasoline supplies,” Ysmel Serrano tweeted.

Industry Woes

The gasoline shortage comes as new top executives are appointed at PDVSA, largely from political and military quarters, and increasing problems in Venezuela’s oil industry.

As of March 22, about a dozen tankers were waiting around PDVSA ports in Venezuela and the Caribbean to discharge refined products, components, and diluents crucial for oil blending, Reuters vessel tracking data showed.

Backlogs and payment delays to PDVSA’s suppliers, which are now demanding to be prepaid, sometimes mean shippers wait weeks to deliver oil products.

And many tankers are idle because PDVSA cannot pay for hull cleaning, inspections, and other port services, according to internal documents and Reuters data.

Union leader Ivan Freites, a PDVSA critic, said Venezuelan refineries, which have been at around half capacity for months amid outages, only had oil inventories for around two days versus a standard of 15.

“To solve this immediately, we would need deliveries from at least 10 tankers,” he said.

In Venezuela’s industrial city of Puerto Ordaz, the problem has been increasing this week and National Guard soldiers were trying to maintain order at operational service stations.

“We’ve been working extra hours, opening before 6 a.m and closing after 11 p.m. because of the lines,” said Caura service station manager Felix Rodriguez, tired and with blood-shot eyes, adding he had not been given a reason for the slow deliveries.
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Dozens of German companies including Siemens attended meetings in Bolivia this week to discuss building a coast-to-coast railway through Brazil, Bolivia and Peru that could speed up the export of corn and soybeans to Asia, German and Bolivian officials said on Wednesday.

The massive, $10-billion project would involve building a 3,700-kilometer (2,299 miles) rail line across the continent, linking the Atlantic and Pacific oceans, through mountains and jungles.

“This is the project of the century,” said Germany’s State Secretary of German Transport, Building and Urban Development Rainer Bomba.

Representatives from Brazil, Peru, Paraguay, Uruguay and Bolivia as well as Germany and Switzerland are still studying the feasibility of the train route, which would drastically shorten shipping routes from Brazil’s coast to Asian markets for key commodities.

Siemens, Europe’s top engineering group, participated in the meetings “to get more information about the project,” spokesman Dennis Hofmann said in an email.

“The project is at an early stage and questions have to be clarified,” he wrote.

The discussions, on Tuesday and Wednesday, come after a similar, Chinese-led project build a trans-South America railway ran into roadblocks late last year due to cost and environmental concerns.

Bolivian and German officials did not name other companies that attended the meetings, but Bomba said: “The presence of 40 German companies here demonstrates that Germany is not only in the planning phase, but also in the realization phase.”

Bolivia’s Public Works Minister Milton Claros told Reuters Bolivia and Germany had signed agreements for technical assistance and financing for the project. The ministry said the project would connect the Brazilian port of Santos to the Peruvian port of Ilo and had a preliminary cost estimate of $10 billion.

Brazil is expected to export 28 million tons of corn and 61 million tonnes of soybeans in the 2016/17 crop year according to the USDA. It is the world’s largest soybean exporter and second-largest corn exporter.

China and Peru agreed in 2015 to study a 3,000-mile-long railway through the Andes, but Peru balked when China estimated its cost at $60 billion. Peru’s President Pedro Pablo Kuczynski later said the rail should go through Bolivia.

Land-locked Bolivia has long pined for a corridor to the Pacific, blasting Chile for taking its coastline in a war in the late 19th century and maintaining its Navy on Lake Titicaca.

Brazil had also questioned the Chinese project and would likely back the Bolivian route, a member of the Brazilian delegation said.

“We identified problems in the reports made by the Chinese group. We communicated the points of disagreement to Chinese authorities and we are seeing how we can continue the studies,” said Joao Carlos Parkinson, coordinator of economic affairs at Brazil’s Foreign Ministry, who attended the meetings.

Brazil’s Ambassador to Bolivia Raymundo Santos said talks would continue.

“Our delegation confirmed Brazil’s interest in participating,” he said. “The political side has been resolved, but now the technical work has to move forward.”
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The big snowstorm in the U.S. Midwest and East last week was a respite for some small-business owners whose revenue took a hit from the generally mild winter and who now are rethinking their cold-weather strategies.

Retailers who sell winter clothing or snow shovels have had fewer customers this season. Plumbers who expected to fix frozen pipes have had less work, and people who make money removing snow have had idle equipment. On the flip side, better weather means more business for companies that cater to people who want to be outdoors.

The period from December through February was the sixth-warmest winter on record, according to the National Oceanic and Atmospheric Administration, the U.S. government agency that compiles statistics about the weather. The average January temperature in the lower 48 states, which excludes Alaska and Hawaii, was 33.6 degrees Fahrenheit (less than 1 degree Celsius). That’s a few degrees above the 20th-century average. And February was downright hot in some places — nearly 12,000 local warm records were set or tied, including a 99-degree (37-degree Celsius) reading in Oklahoma.

Meanwhile, snow was sparse in many places. Chicago, which has often had 1 foot (0.3 meter) or more in February, was virtually snowless last month. The temperate weather meant dog owners didn’t need warm coats and protective booties for their pooches. Hope Saidel, co-owner of the retailer Golly Gear in the Chicago suburb of Skokie, had half the normal amount of sales during January.

‘Devastating’ drop

“When we heard the 10-day forecast was going to be up in the 60s [Fahrenheit], we thought, ‘This is not going to be good,’ ” Saidel says. “It was devastating.”

Saidel quickly changed her strategy to focus on warm-weather items like leashes, harnesses and bicycle baskets that can carry small dogs, and moved the coats and booties away from the front of the store. That helped salvage the season.

The warmer weather saved homeowners from frozen and burst pipes, but their good fortune has curtailed business for Ted Puzio’s plumbing and electrical company in Roanoke, Virginia. The average low temperature in the area this winter has been several degrees above normal, according to the government figures. Southern Trust Home Services, whose business is entirely residential, also isn’t getting as many service calls as usual for heating system repairs.

Puzio’s overall business is growing, but he notices the shortfall from the plumbing side of the company.

“We’re not getting the bump-up we typically do,” Puzio said.

Atlantic Westchester, a Bedford Hills, New York, company that services commercial heating and air-conditioning systems, makes more money when it’s colder and heating systems have to work harder. But this has been the second mild winter in a row, and President Bud Hammer estimates revenue is down 15 percent from a typical season.

Maintenance work

To make back some revenue, the company has sought work at buildings that hadn’t maintained their heating systems during and after the Great Recession that began nearly a decade ago. Hammer’s salespeople are contacting building managers and keeping watch for potential customers with telltale signs of trouble — like a building that has open windows because the heating system is in overdrive.

Temperatures that the U.S. government said have been several degrees higher than normal have hurt both of Tara Saxton’s businesses in the Fremont, New Hampshire, area. Saxon’s contracting company, KTM Exteriors & Recycling, has missed out on cold-weather work like clearing snow off roofs. It also has been unable to start on warmer-weather projects like replacing roofs and siding, because temperatures that made it into the 60s (more than 15 degrees Celsius) have also quickly nose-dived. Although Saxton has been doing more interior work like kitchens, revenue is still down more than $200,000 this winter.

Saxton’s other business, Maple Rock Racing, a promoter of snowmobile races, was hurt when several races had to be postponed because of the lack of snow — the second straight year a mild weather has disrupted the schedule. For the races that were held, attendance was in the hundreds, not thousands. Some sponsors already withdrew after last winter, and Saxton is uneasy about the future.

“I’m sure after this year, we’ll be in a similar situation when we go calling [sponsors] this summer,” she said.

But some companies got a revenue boost this winter.

At Sunnyland Furniture in Dallas, a patio furniture retailer whose sales usually slow in winter, warmer weather enticed people to buy fire pits and seating so they can sit outside when the temperature is in the 50s (more than 10 degrees Celsius), Vice President Brad Schweig said. Shoppers are also looking ahead to spring.

“We’ve seen things ramp up earlier than usual,” Schweig said.

Swimming in customers

Jason Askins’ pool remodeling and repair franchise had an 80 percent increase in business the first two months of this year because of the warmer weather in Edmond, Oklahoma.

“People are starting to think about getting the pool ready,” said Askins, whose phone at America’s Swimming Pool doesn’t usually start ringing until April. The extra business allowed Askins to hire seasonal workers early; he’s already brought in five and expects six more, giving him a staff of 15.

When Michelle and Frank Griffith started their food truck business, Firehouse Grilling Co., last year, they expected to take the winter off, as Cleveland usually has high temperatures around 37 (3 degrees Celsius). But the average since December has been several degrees above that, with February’s highs around 50 (10 degrees Celsius), according to government figures — warm enough to bring people outdoors to get something to eat.

“The snowblower hasn’t been even taken out,” Michelle Griffith said. She estimated that the couple picked up an extra 20 percent in revenue because they kept the converted firetruck operating through the winter. But they did change the menu to fit the calendar.

“We’ve done chili, hot chocolate, warm comfort foods,” Griffith said. “I wouldn’t sell chili in the middle of the summer at an amusement park.”
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Sears, once the monolith of American retail, says that there is “substantial doubt” that it will be able to keep its doors open.

 

Company shares, which hit an all-time low last month, tumbled more than 12 percent Wednesday.

 

Sears has been a member of the retail dead pool for years, but until this week the company had not openly acknowledged its tenuous existence, said Ken Perkins, who heads the research firm Retail Metrics LLC.

 

Sears has long maintained that by balancing the sale of key assets while at the same time enticing customers with loyalty programs, it would eventually turn the corner.

 

Yet industry analysts have placed the staggering sums of money that Sears is losing beside the limited number of assets it has left to sell, and concluded that the storied retailer may have reached the point of no return.

 

The company has lost $10.4 billion since 2011, the last year that it made a profit. Excluding charges that can be listed as one-time events, the loss is $4.57 billion, Perkins says, but how the losses are stacked no longer seem to matter.

 

“They’re past the tipping point,” Perkins said. “This is a symbolic acknowledgement of the end of Sears of what we know it to be.”

 

For Sears to survive, Perkins believes it would need to do so as a company running maybe 200 stores. It now operates 1,430, a figure that has been vastly reduced in recent years.

 

Analysts see not much of a future

As for Kmart, which Sears also owns, Perkins does not see much of a future.  

 

Millions of dollars have been funneled through the hedge fund of Chairman and CEO Edward Lampert to keep Sears afloat but with sales fading, it is burning through cash. Lampert combined Sears and Kmart in 2005, about two years after he helped bring Kmart out of bankruptcy

 

According to a regulatory filing late Tuesday, Sears Holdings Corp. lost more than $2 billion last year. Adjusted for one-time charges, its loss was $887 million.

 

Sears has been selling assets, most recently its Craftsman tool brand. But it says its pension agreements may prevent the spin-off of more businesses, potentially leading to a shortfall in funding.

“Our historical operating results indicate substantial doubt exists related to the company’s ability to continue as a going concern,” Sears said in a filing with the Securities and Exchange Commission.

 

Sears, which employs 140,000 people, announced a major restructuring plan in February with hopes of cutting costs by $1 billion through the sale of more stores, jobs cuts and brand asset sales.  And it’s reconfiguring its debts to give itself more breathing room.

But it has to get more people through the doors or shopping online for what it’s selling.

 

Sales at Sears and Kmart locations that have been open at least a year, a key indicator of a retailer’s health, dropped 10.3 percent in the final quarter of 2016.

 

The company plans to use a big portion of the $900 million it got for Craftsman to shore up its pension plan. It will put $250 million in cash and some income from annual payments toward the plan as part of a deal with the Pension Benefit Guarantee Corp., a federal agency that protects private pension plans.

 

The company said in its regulatory filing, however, that its agreement with the agency might stand in the way of more asset sales that would buy it more time.

 

Lampert has long pledged to return Sears to greatness, leveraging best-known brands like Kenmore and DieHard, as well as its vast holdings of land.

 

Failing to reach new kind of consumer

Those aspirations have been scrambled by a new consumer that has ripped up the decades-old playbook that the industry has relied upon for years.

 

There are also new and dynamic players that have also revolutionized the market, namely Amazon.com.  

 

Department stores have been among the hardest hit by those seismic changers as Americans spend money on their homes or on dinners out, rather than on clothing. When they do buy clothes, they’re not spending much, hitting up places like T.J. Maxx for fat discounts.

 

Sears has upped its presence online, but is having a hard time disguising its age. Its stores are in need of a major redo.

 

Longtime rivals like Wal-Mart and Target are spending heavily to revitalize stores and they’re intensely focused on a new consumer that goes online before stepping into a store.  Meanwhile, J.C. Penney has been hitting Sears hard by bringing back major appliances to its stores. Penney, Macy’s and others have been shuttering locations as well. But real estate research firm Green Street Advisors says about 800 stores, or 20 percent of all U.S. mall anchor space, would need to close to match the inflation-adjusted sales productivity of 2006.

 

Sears in January said it would close 108 additional Kmart and 42 more Sears locations.

 

In its most recent quarter, Sears, based in Hoffman Estates, Illinois, just northwest of Chicago, lost $607 million. Revenue declined to $6.05 billion from $7.3 billion during the same period the year before.

 

It was the sixth consecutive quarter of losses.

 

“They’ve been delusional about their ability to turn around the business,” said Perkins.
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Farmers in the U.S. agricultural heartland who helped elect Donald Trump are now pushing his administration to avoid a trade dispute with Mexico, fearing retaliatory tariffs that could hit over $3 billion in U.S. exports.

The value of exports at risk is based on a Reuters analysis of a tariff list that Mexico used in a trucking dispute six years ago and that  Mexican officials have said could serve as a model if Trump sets new barriers to Mexican goods.

Pork producers contacted Trump’s transition team soon after the November 8 election to stress that tariff-free access to Mexico has made it their top export market by volume, said John Weber, president of the National Pork Producers Council.

The council has sent the administration multiple letters, including one signed in January by 133 agricultural organizations, and is arranging for several hog farmers to fly to Washington next month to talk to officials.

‘Pounding them’ on trade

“We just keep pounding them on how critical trade is to us,” said Weber, who fears Mexico could revive the list of mostly agricultural products it successfully used to push Washington into letting Mexican truckers on U.S. highways in 2011.

Pork products topped that list and, if revived, the tariffs would apply to over $800 million worth of annual pork exports, according to data compiled by IHS Markit’s Global Trade Atlas.

“We’ll be the first to take the hit,” Weber said.

The lobbying effort by U.S. businesses that rely on the Mexican market shows how Mexico can press its case in Washington despite having an economy 1/17 the size of America’s and relying on the U.S. market for nearly 80 percent if its exports.

In Iowa, where pigs outnumber people 7 to 1, hog and grain farmer Jamie Schmidt voted for Trump in part on his promise to cut regulatory burdens for businesses.

 

Now he and others who farm the flat, rich land around Garner, Iowa, worry about trade. Schmidt gets about half of his income from hogs, earning $4 to 5 for each of the 425 pigs he sells per week, usually to a Tyson Foods packing plant in nearby Perry, Iowa.

Tariffs from Mexico could depress U.S. wholesale prices and wipe out his profits, Schmidt said. “It would be devastating.”

Targeting states

In December, after fears of a trade dispute fueled a deep peso slump, Mexico started mapping out U.S. states that are most reliant on its market, replicating the strategy it used in the trucking dispute, said two senior Mexican officials.

Mexican officials also prepared briefs, seen by Reuters, on Mexico’s own risks in a dispute, including losing much of its cost advantage in building cars, such as the Ford Fusion made in Hermosillo, Mexico.

Reuters could not verify a complete list of products and states Mexico considered targeting this time around.

But the country’s foreign minister said last month that tariffs could target Iowa, which raises a third of U.S. hogs and exports about a quarter of its pork production, $100 million of which went to Mexico last year.

The minister also said tariffs could aim at Wisconsin, the center of U.S. cheese production, and has singled out Texas for its “notable” trade surplus with Mexico. All three states voted for Trump in the 2016 election, with the president taking Iowa and Wisconsin by slim margins.

 

Trump has accused Mexico of destroying U.S. jobs and has vowed to leave the 1994 North American Free Trade Agreement with Canada and Mexico if he cannot renegotiate better terms with Mexico. The United States went from running a small trade surplus with Mexico in the early 1990s to a $63 billion deficit in 2016.

Besides pork, cheese was also a top target in the trucking dispute in which Mexico retaliated with tariffs against rules that banned its trucks from U.S. roads.

$3B-plus in U.S. exports

Some $200 million in current annual exports of cheese would be targeted if the tariff list were revived, according to the IHS database, which the U.S. government uses to measure the impact of trade disputes. The full tariff list would apply to $3.25 billion in current U.S. exports.

John Holevoet, the director of government affairs at Wisconsin’s Dairy Business Association, said he has attended multiple meetings with Wisconsin federal lawmakers this year where risks of Mexican trade were discussed.

Weber of the pork producers group said he believed the Trump administration understands the vulnerability of U.S. farm exports. Republican Representative Steve King, who represents Iowa’s agriculture-focused 4th Congressional District, also pointed out that Iowa’s role as the first state in the presidential nominating process helps keep farm interests in Washington’s view.

But King told Reuters he was worried the White House was still not taking trade risks seriously enough.

A possible 20 percent tax on Mexican imports, which White House spokesman Sean Spicer has said could also pay for Trump’s proposed border wall, would cause a trade war, he said.

King said he had been in contact with the White House on the matter but had yet to secure a one-on-one meeting with the president. “I’m making sure that here in Washington they know what this means.”
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