Month: August 2018

Tesla Inc. CEO Elon Musk says investors have convinced him that he shouldn't take the company private, so the firm will remain on the public stock markets. The eccentric and sometimes erratic CEO said in a statement late Friday that he made the decision based on feedback from shareholders, including institutional investors, who said they have internal rules limiting how much they can sink into a private company. Musk met with the electric car and solar panel company's board on Thursday to tell them he wanted to stay public and the board agreed, according to the statement. In an Aug. 7 post on Twitter, Musk wrote that he was considering taking the company private. He said it would avoid the short-term pressures of reporting quarterly results. ...

U.S. Commerce Secretary Wilbur Ross has appointed a former federal prosecutor to monitor China's ZTE Corp — after people familiar with the matter said he rescinded an offer to a former U.S. official for signing a "Never Trump" letter before the 2016 presidential election. A new monitor for ZTE is required as part of a June settlement that ended a ban on U.S. companies selling components to China's No. 2 telecommunications equipment maker. The ban threatened ZTE's survival and became a source of friction in trade talks between Washington and Beijing. Roscoe Howard, a former U.S. attorney in Washington, will lead a compliance team designed to help ensure that ZTE does not illegally sell products with American parts to Iran and other sanctioned countries. Howard, who got his law degree…

Federal Reserve Chairman Jerome Powell will not lack for urgent topics to address when he gives the keynote speech Friday to an annual gathering of global central bankers in Jackson Hole, Wyoming. Fed watchers will be listening for anything Powell has to say about financial turmoil in emerging markets, the economic threats posed by the growing trade war launched by President Donald Trump, and Trump’s criticism of the Fed’s recent interest rate hikes. Investors will especially want to hear whether Powell addresses the central question of whether any of those developments might lead the Fed to alter its plan to raise interest rates two more times this year and to keep raising them next year as well. If Powell sounds confident that the economy won’t be unduly hurt by the…

Federal Reserve Chairman Jerome Powell signaled Friday that he expects the Fed to continue gradually raising interest rates if the U.S. economic expansion remains strong. Powell added that while annual inflation has risen to near the Fed's 2 percent target rate, it doesn't seem likely to accelerate above that point. That suggests that he doesn't foresee a need for the Fed to step up its rate hikes. Late next month, the Fed is widely expected to resume raising rates. Speaking to an annual conference of central bankers in Jackson Hole, Wyoming, Powell said the Fed recognizes that it needs to strike a careful balance between its mandates of maximizing employment and keeping price increases stable. He said a gradual approach is the best way for the Fed to navigate between…

A new set of tit-for-tat tariffs imposed by the United States and China on each other's goods took effect Thursday. The U.S. announced earlier this month that it would impose 25 percent tariffs on $16 billion worth of Chinese goods, on top of the 25-percent tariffs it imposed on $34 billion worth of Chinese products in early July. Beijing has followed suit in each case with an identical percentage of tariffs in retaliation. China's commerce ministry issued a statement Thursday criticizing the U.S. tariffs as a violation of World Trade Organization rules, and says it will file a legal challenge under the WTO's dispute resolution mechanism. The new round of tariffs took effect the day after delegations from both nations met in Washington for first of two days of talks…

French President Emmanuel Macron will make the tough political choices needed to meet his deficit commitments, his government spokesman said, as he looked to put a bodyguard scandal behind him at his first Cabinet meeting after the summer break. Macron and his ministers in all likelihood need to find savings in next year's budget, to be presented to parliament next month, if they are to prevent the deficit from ballooning once again. The president faced his first crisis in the summer when video surfaced of bodyguard Alexandre Benalla beating a protester. Macron's own aloof response fanned public discontent. Now the 40-year-old leader returns to work facing difficult political choices as he embarks on a new wave of reforms to reform the pensions system, overhaul public healthcare and shake-up the highly…

Saudi Arabia has called off both the domestic and international stock listing of state oil giant Aramco, billed as the biggest such deal in history, four senior industry sources said on Wednesday. The financial advisors working on the proposed listing have been disbanded, as Saudi Arabia shifts its attention to a proposed acquisition of a "strategic stake" in local petrochemicals maker Saudi Basic Industries Corp., two of the sources said. "The decision to call off the IPO was taken some time ago, but no-one can disclose this, so statements are gradually going that way — first delay then calling off," a Saudi source familiar with IPO plans. Saudi Aramco did not immediately respond to an emailed request for comment. The Saudi Royal Court had no immediate comment. The proposed listing of…

Disney is offering to pay full tuition for hourly workers who want to earn a college degree or finish a high school diploma. The Walt Disney Co. said Wednesday it will pay upfront tuition to workers who want to take classes starting in the fall. Disney initially will invest $50 million into the "Disney Aspire" program and up to $25 million a year after that. Other large corporations have begun paying tuition for workers in a job market with low unemployment. In May, Walmart said it will offer workers the chance to get a college degree at three universities with online programs. Disney is rolling out its program in phases, with the first limited to online classes. It is being administered by Guild Education, the same firm operating Walmart's program.…

Following Seoul's announcement that South Korean companies have illegally imported North Korean coal, U.S. experts are worried about North Korean trade that contravenes international sanctions. The Korea Customs Service (KCS) announced earlier this month that three South Korean companies illegally imported North Korean coal that was transshipped at Russian ports, in violation of United Nations resolutions. The U.N. Security Council adopted a resolution on August 5, 2017, banning North Korea from exporting coal, iron, lead and other materials. Another resolution later that year, on December 22, called for U.N. members to seize and inspect vessels suspected of transporting prohibited items.  According to the KCS, in seven shipments between April and October of last year, three South Korean companies imported a total of 35,038 tons of North Korean coal and pig iron…

Chilean President Sebastian Pinera said on Tuesday that his overhaul of the country's tax structure would "modernize" Chile's revenue system and stimulate investment by local and foreign companies. The conservative leader said in a televised address that reform would, among other proposals, calibrate taxes paid by conventional companies with those paid by digital technology companies. The reform aims "to create a simpler and more equitable and fully integrated tax system for all Chilean companies." Digital commerce companies with local operations like Netflix and Uber are likely to be affected under the reform. E-commerce is gaining traction in Latin America after a slow start. Last month, an Amazon Web Services vice president met with Pinera to discuss Amazon investing in the country as part of a longer-term regional expansion plan. Pinera,…

Mexico risks losing long-term passenger growth and billions of dollars if it fails to go through with building a new hub in the capital to alleviate congestion, an executive with the International Air Transport Association (IATA) said on Tuesday. Mexico's incoming government last week postponed a decision on whether to complete a partially constructed new airport in Mexico City, saying the public should be consulted on the fate of the $13-billion hub, which the next president initially opposed. President-elect Andres Manuel Lopez Obrador said the project was tainted by corruption prior to his July 1 landslide election victory, and had pressed for an existing military airport north of the capital to be expanded instead. Without the new airport, around 20 million fewer passengers would fly to Mexico City starting in…

Claudio Belotti knows he cut the denim that became the jeans Meghan Markle wore on one of her first outings as the fiancee of Britain's Prince Harry.   That's because he cuts all of the fabric for Hiut Denim Co., a 7-year-old company that makes jeans in Cardigan, Wales. Belotti is a craftsman with 50 years of experience that gives his work a personal touch — something that's not quite couture but not exactly mass-produced either.   "There's a story behind each one," Belotti said. "You're paying for the skill."   Customer demand for something unique is helping small companies like Hiut buck the globalization trend and set up shop in developed countries that had long seen such work disappear. While international brands like H&M and Zara still dominate the clothing…

South Africa's state-owned Land Bank said on Monday a plan to allow the state to seize land without compensation could trigger defaults that could cost the government 41 billion rand ($2.8 billion) if the bank's rights as a creditor are not protected. Land Bank is a specialist bank providing financial services to the commercial farming sector and other agricultural businesses. President Cyril Ramaphosa announced on Aug. 1 that the ruling African National Congress (ANC) is forging ahead with plans to change the constitution to allow the expropriation of land without compensation, as whites still own most of South Africa's land more than two decades after the end of apartheid. Land Bank Chairman Arthur Moloto said in the company's 2018 annual report that the bank has approximately 9 billion rand of…

The bull market in U.S. stocks is about to become the longest in history.   If stocks don't drop significantly by the close of trading Wednesday, the bull market that began in March 2009 will have lasted nine years, five months and 13 days, a record that few would have predicted when the market struggled to find its footing after a 50 percent plunge during the financial crisis.   The long rally has added trillions of dollars to household wealth, helping the economy, and stands as a testament to the ability of large U.S. companies to squeeze out profits in tough times and confidence among investors as they shrugged off repeated crises and kept buying.   "There was no manic trading, there was no panic buying or selling," said Jack…

Beverage giant PepsiCo on Monday purchased Israel's fizzy drink maker SodaStream for $3.2 billion, a boon for a company that has enjoyed a resurgence after being targeted by anti-Israel boycotters in the past. PepsiCo said it was acquiring all SodaStream's outstanding shares at $144 per share, a 32 percent premium to the 30-day volume weighted average price.   Earlier this month, SodaStream reported its strongest results in company history, a 31 percent year-over-year jump in revenues to $172 million, an 89 percent leap in operating profit to $32 million and an 82 percent climb by net profit to $26 million.   PepsiCo Chairman and CEO Indra Nooyi called the companies "an inspired match" since both companies aim to reduce waste and limit their environmental footprint.   "Together, we can advance…

U.S. oil giant ConocoPhillips says it has reached an agreement with Venezuela's state-owned oil company to recover nearly $2 billion it was awarded as part of a decade-old expropriation dispute. Monday's statement from Houston-based Conoco says that PDVSA has agreed to recognize the judgement by an international arbitration panel and will make the first $500 million payment within 90 days and the rest over a period of some four years. In exchange, Conoco will suspend legal actions to seize PDVSA's facilities in the Dutch Antilles that had threatened to disrupt Venezuela's already-depressed oil exports at a time of widespread shortages and hyperinflation. PDVSA hasn't commented comment. The award is equivalent to more than 20 percent of cast-strapped Venezuela*s foreign currency reserves. ...

Malaysian Prime Minister Mahathir Mohamad says he hopes China will understand his country's "internal fiscal problems" as he seeks to renegotiate billions of dollars worth of Beijing-funded projects. Mahathir spoke Monday in Beijing during a joint news conference with Chinese Premier Li Keqiang. Before traveling to China last week, Mahathir suspended three major infrastructure projects that are funded with Chinese loans worth more than $20 billion, including an ambitious rail line and two energy pipelines. The prime minister said he halted the projects due to Malaysia's massive national debt, which has ballooned to $250 billion. The projects were initiated under Mahathir's predecessor, Najib Razak, who has been charged with several counts of corruption in the embezzlement scandal involving the state-owned 1MDB sovereign wealth fund. The scandal led to a stunning…

"For the first time since early 2010, Greece can stand on its own feet," the European Stability Mechanism (ESM) rescue fund said as Athens exited its final, three-year international bailout program on Monday. The ESM allocated about $71 billion over the past three years, after an agreement was reached in August 2015 to help the country cope with fallout from an ongoing debt crisis. "Today we can safely conclude the ESM program with no more follow-up rescue programs," Mario Centeno, the chairman of the ESM's board of governors, said in a statement. "This was possible thanks to the extraordinary effort of the Greek people, the good cooperation with the current Greek government and the support of European partners through loans and debt relief." In 2010, Greece was declared at risk…