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Re: Business/Markets/Stocks/Economics Random, Random

#466

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GOP readies debt ceiling vote as Wall Street braces for costly standoff
Investors are beginning to hedge against a possible government default, laying bare the stakes of congressional inaction

By Tony Romm

Investors on Wall Street are bracing for the prospect of a protracted, costly standoff in Washington over the debt ceiling, underscoring the economic risks as House Republicans prepare to vote on new legislation as soon as Wednesday.

In recent weeks, two key developments — including a drop in yields on government bonds set to mature imminently — have suggested a growing panic that the GOP’s demands could cause the country to default, touching off what analysts widely believe would be another U.S. recession.

The uncertainty has added to the challenge facing House Speaker Kevin McCarthy (R-Calif.) as he looks to assuage some Republicans’ last-minute reservations over a bill that Democrats uniformly oppose. The GOP proposal would slash federal spending dramatically and unwind some of President Biden’s top priorities, including student debt cancellation, in exchange for an increase in the debt ceiling — the statutory cap on how much the U.S. government can borrow to pay its bills.

With no resolution in sight — and the deadline drawing closer by the day — some on Wall Street have started to contemplate the possibility of a default. Joseph Brusuelas, the principal and chief economist at RSM, an accounting firm, said this week that “financial markets are now moving to begin pricing in the more difficult portion of the gridlock over the debt ceiling,” adding that the uncertain state of the economy has left some investors “on edge.”

The financial turbulence highlights the stakes in the nation’s capital, more than a decade after Republicans last used the debt ceiling as leverage to seek spending cuts. That 2011 fight — between ascendant, conservative tea-party Republicans and President Barack Obama — rattled the stock market, precipitated a downgrade in U.S. credit and ultimately cost taxpayers more than $1 billion.

This year, McCarthy has maintained that Republicans hope to avoid default. In a speech at the New York Stock Exchange last week, he blamed Biden, who has refused to negotiate out of a belief that the debt ceiling should be raised without conditions to prevent any disruptions to the fragile U.S. economy.

Two days later, McCarthy unveiled legislation that he said would preserve U.S. credit and slow the accumulation of debt. The so-called Limit, Save, Grow Act of 2023 would cap federal agency spending over the next decade, achieving more than $3 trillion in savings, according to GOP estimates. It would also repeal key climate investments and impose new work requirements on recipients of federal aid, including Medicaid.

But McCarthy still must cobble together the necessary 218 votes for it to pass — no easy feat for a narrow majority of 222 members long troubled by its own ideological divisions. By Tuesday morning, the party appeared to have at least a half-dozen remaining holdouts, whose opposition could scuttle the bill, since Republicans only have four votes to spare.

Some moderate Republicans, including Rep. Nancy Mace (R-S.C.), have signaled early unease that the GOP plan could hurt their districts, particularly by rolling back tax credits to boost solar energy. Conservatives, meanwhile, have demanded that McCarthy and other Republican leaders commit to holding their ground and resisting any changes that weaken the bill in the Senate, where Democrats say they’ll refuse to consider the GOP legislation.

“This is the bare minimum for me and a host of other people,” said Rep. Ralph Norman (R-S.C.), a top member of the far-right House Freedom Caucus, estimating there are four lawmakers in his ranks that are “leaning no” until they can secure hard commitments from McCarthy.

Later Tuesday, the House Rules Committee plans to take the first procedural step toward starting debate on the chamber floor. Lawmakers could vote on the bill as soon as Wednesday, a timeline that prompted some Republicans to express a note of confidence about their odds for success.

“Speaker McCarthy’s been at the table. And he has offered to negotiate with the president. Now we’re going to put our terms on a piece of paper, get 218 Republicans, and we’re going to put the ball in their court,” said Rep. Jodey Arrington (R-Tex.), the leader of the House Budget Committee, in an interview on Fox News.

The White House, meanwhile, threatened to veto the bill on Tuesday, citing its adverse impact it could have on families and the broader economy.

But the precarious political environment has not been lost on Wall Street, where investors began to raise alarms shortly after McCarthy’s speech. The primary source of their concern was federal tax collections: In the days before 2022 returns were due, analysts began to notice that tax receipts had come in lower than anticipated.

The drop carries immense implications for the debt ceiling deadline, known in Washington as the “x-date,” since it helps determine how long the United States can use a mix of its own revenue and special budgetary maneuvers to stave off a default. The Treasury Department is expected to release a more complete analysis next month, reflecting taxes collected through the April 18 filing deadline.

“There’s nothing like the sight of the gallows to concentrate the mind. That could cause the conversation to become more serious,” said David Kelly, the head of the Global Market Insights Strategy Team for J.P. Morgan Asset Management.

In an ominous note last week, analysts at Goldman Sachs said the tax shortfall could shorten the timeline for action — meaning the government could run out of options in July, though they could not rule out a deadline as soon as early June. That could unleash an urgent scramble on Capitol Hill, where some lawmakers had been counting on the possibility they had until as late as September.

“We think that non-withheld tax receipts so far still lean slightly in favor of a late July deadline, but it would take only a few days of slightly weaker tax collections to tip the deadline to early June,” the analysts at Goldman Sachs wrote in their April 19 note.

In response, investors have started to shift their behavior. Some have avoided Treasury bills — bonds issued by the federal government — that mature around the likely debt ceiling deadline. In its own note last week, analysts at J.P. Morgan noted that yields on a three-month Treasury bill have spiked, while one-month yields have plummeted, a gap they noted is the “widest in over 20 years.” Historically, those yields tend to move in concert, so the gap may reflect investors’ fear about a default over the summer.

“We expect these oddities to continue as policymakers work out the kinks to reassure investors of the soundness of short-term government debt,” the bank found.

Other analysts saw early cause for concern in the price of sovereign credit default swaps — essentially, a hedge against a default on U.S. government debt, which would pay out if the government does fail to pay bond interest. Prices are “substantially more” than they were at the last debt ceiling crisis in 2011, according to a new analysis by Mark Zandi, the chief economist at Moody’s Analytics, published late Monday.

Zandi cautioned the market is an imperfect gauge of investor sentiment, particularly given the role of hedge funds in placing such bets. Still, his report found that global investors “appear to be attaching non-zero odds that the debt limit drama will end with a default sometime in June or July.” He also warned that the adoption of the GOP proposal could carry its own adverse effects, potentially reducing gross domestic product by 0.65 percent by the end of the fourth quarter of 2024.


Seizing on the findings, White House press secretary Karine Jean-Pierre said in a statement that the GOP bill would “cut the American economy off at the knees.”

“President Biden believes we should be investing in America to revitalize American manufacturing,” she added, “not holding our economy hostage over disastrous proposals that would lead hundreds of thousands of Americans to lose their jobs.”


https://www.washingtonpost.com/business ... ll-street/
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Re: Business/Markets/Stocks/Economics Random, Random

#467

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Here's the tl;dr on the above article

GramGram (Dr. Betsy) 💙🥰
@GramG46133627
Republicans Are Coming With Knives to Gut FDR's New Deal

While the American people loved Roosevelt's democratic socialism—and still do—the extremely rich have always opposed any programs that lift up average working people.
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Re: Business/Markets/Stocks/Economics Random, Random

#468

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Bob Jamieson
@bobjmsn@mastodon.scot
Britons ‘need to accept’ they’re poorer, says Bank of England economist

Chief economist Huw Pill says workers and firms should stop trying to pass on rising costs by hiking prices or demanding better wages

In other words "we, the rich, are fleecing you, and you need to stop asking for more, because that means we get less."

https://www.theguardian.com/business/20 ... -economist

#rich #economist #inflation #greed #polítics
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Re: Business/Markets/Stocks/Economics Random, Random

#469

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“Do not grow old, no matter how long you live. Never cease to stand like curious children before the Great Mystery into which we were born.” Albert Einstein
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Re: Business/Markets/Stocks/Economics Random, Random

#470

Post by ponchi101 »

About this "game of chicken" that gets to be played so often in the USA, regarding the debt ceiling.
This is not an American problem. When your economy is 1/3 of the world's, this is a world economy. But as long as the USA keeps accruing more and more debt, this is simply a larger ticking bomb.
The USA needs to make a plan to reduce its debt; taxing Wall Street is an easy start (economically; we know it will never happen because of the politics). Otherwise, one day we will wake up with a world's economy that imploded.
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Re: Business/Markets/Stocks/Economics Random, Random

#471

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Re: Business/Markets/Stocks/Economics Random, Random

#472

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Welp



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Re: Business/Markets/Stocks/Economics Random, Random

#473

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Re: Business/Markets/Stocks/Economics Random, Random

#474

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Re: Business/Markets/Stocks/Economics Random, Random

#475

Post by ponchi101 »

Maybe the software update cannot be made over the internet because China's internet is not "open" as the rest of the world knows it.
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Re: Business/Markets/Stocks/Economics Random, Random

#476

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Billionaire investor George Soros' fund dumped its entire Tesla stake in the first quarter - cashing out on the EV's maker's 2023 rebound
Zahra Tayeb May 15, 2023, 5:54 AM EDT

George Soros' family office cashed out on Tesla's impressive stock-market rebound this year by selling its entire stake in the first quarter, according to a 13F filing published Friday.

Soros Fund Management had gradually added to its holdings of Tesla stock during the second quarter of 2022, holding around 132,000 shares by the end of last year. By offloading that position, the fund likely enjoyed significant gains from the surge in the EV maker's stock price this year.

Tesla shares jumped 68% in the first quarter, thanks to a broad rally in the technology sector amid expectations that cooling inflation would allow the Federal Reserve to halt its interest-rate increases. The stock has pared its advance since then, and is currently up about 37% year-to-date.

Soros' fund also cut its holdings in electric-vehicle startup Rivian Automotive, and held 3.58 million shares at the end of the first quarter.

In the banking sector, Soros reduced its stake in First Horizon Bank by 14.37% to 7.31 million shares as the industry weathered its biggest turmoil since the 2008 financial crisis, which started with Silicon Valley Bank's shocking collapse in March.

Meanwhile, the fund newly purchased shares in Walmart, Netflix, and Chinese e-commerce company JD.com during the quarter.

https://markets.businessinsider.com/new ... usk-2023-5

Elmo was not happy and has been attacking Mr. Soros ever since.
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Re: Business/Markets/Stocks/Economics Random, Random

#477

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Elon Musk Sparks Outrage With Antisemitic Twitter Rant About George Soros
After Elon Musk compared George Soros to X-Men supervillain Magneto on Twitter, the antisemitic tropes escalated form there.
Winn Sioux Christnot-Peters
May. 16, 2023

Conspiracy theories about billionaire George Soros abound, and Elon Musk has apparently bought into some of them. The outgoing Twitter CEO recently tweeted Soros "hates humanity."

Musk first tweeted Soros "reminds me of Magneto," referring to the antagonist from X-Men comics—a series well-known to be an allegory for the civil rights movement.

Magneto was a Holocaust survivor whose experience strongly influenced his actions in the comics. Soros is also a Jewish Holocaust survivor, though as far as anyone is aware he doesn't share Magneto's mutant magnetic powers.

Image

Musk's tirade against Soros came just after it was reported Soros investment group sold their shares of Tesla sometime in the first quarter of 2023.

Antisemitic hate speech on the platform has been on the rise since Musk acquired Twitter, with a huge spike the day he took over.

There were, of course, a plethora of Musk fans in the comments parroting his antisemitic conspiracy theories about Soros.

But many were criticizing Musk too.

Some simply questioned or criticized Musk's assertion Soros "hates humanity."

Some pointed out Musk is pretty close to being the very thing he accuses Soros of being.

Whatever his intentions, Musk's tweets were very popular with his growing White supremacist, neo-Nazi right-wing fanbase.


https://secondnexus.com/musk-soros-anti ... 1684275624
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Re: Business/Markets/Stocks/Economics Random, Random

#478

Post by ponchi101 »

I thought the whole point of buying stock was to eventually cash in.
Must be the reason why I am worth 1/trillion th of what Elon is.
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Re: Business/Markets/Stocks/Economics Random, Random

#479

Post by Owendonovan »

It's even easier to avoid twitter if you're not anti-semitic. (I can't be convinced twitter is necessary for anything or anyone)
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Re: Business/Markets/Stocks/Economics Random, Random

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Elon Musk ‘takes ketamine to manage depression’
Drug use by the Tesla chief and the Google founder Sergey Brin revealed in Wall Street Journal

Keiran Southern, Los Angeles
Tuesday June 27 2023, 8.20pm BST, The Times

Elon Musk takes small doses of ketamine to manage depression while the Google co-founder Sergey Brin enjoys magic mushrooms, according to a new report.

Musk, the world’s richest person, is also said to take full doses of ketamine, an anesthetic that can cause hallucinations, at parties.

Studies have shown the drug is effective at treating severe depression.

Musk, 51, has not directly addressed the claims, made in the Wall Street Journal. However, he has previously tweeted about the drug as an alternative to the class of medicines known as selective serotonin re-uptake inhibitors (SSRIs), which are widely prescribed to treat mental health issues.

“Depression is overdiagnosed in the US, but for some people it really is a brain chemistry issue,” the Tesla chief executive wrote in response to the controversial influencer Andrew Tate tweeting “depression is a choice”.

“But zombifying people with SSRIs for sure happens way too much. From what I’ve seen with friends, ketamine taken occasionally is a better option.”

Musk has previously criticised antidepressants and last year called for Wellbutrin, a widely used antidepressant, to be taken off the market.

Image
Ketamine is an anaestetic that can cause hallucinations. Elon Musk, the world’s richest person, is said to have taken it at parties
AP

He said: “Every time that drug has come up in conversation, someone at the table has a suicide or near suicide story.”

Experts countered that Wellbutrin had been an effective treatment for depression for years and accused Musk of spreading misinformation.

The report of Musk’s alleged use of ketamine and 49-year-old Brin’s alleged fondness of magic mushrooms also featured the claim that executives at a Silicon Valley venture capital firm had thrown parties that included psychedelics.

A spokeswoman for Founders Fund, based in San Francisco, said: “Research shows that psychedelics can provide significant mental health benefits, and we support public and private sector efforts to make these drugs safely and legally available.”

Illegal and legal drug use is believed to be widespread in Silicon Valley, with executives said to be keen to expand their minds in the hopes of making business breakthroughs.

Earlier this year the so-called “Lifestyle” among tech industry elites made international headlines after the death of Bob Lee, the founder of payment system Cash App. Lee, fatally stabbed during a row with another tech worker, is said to have regularly taken recreational drugs at secretive parties. A post mortem examination showed that he had ketamine and cocaine in his system.

Edward Sullivan, the chief executive of Velocity Coaching, a business that helps tech industry executives, said drug use in Silicon Valley has increased dramatically in the last five years, with about 40 per cent of his clients now expressing an interest in using psychedelics.

Half a decade ago it was just a handful, he said.

“A few years ago, talking about psychedelics in Silicon Valley was a big no-no,” Sullivan told the Journal. “That has really changed.”

While ketamine is available on prescription in the US, including as a medically-supervised treatment for depression, non-medical uses are illegal.

Psilocybin, the active ingredient in magic mushrooms, has meanwhile been decriminalised at a local level in various cities, including Oakland, Washington DC, Seattle and Detroit, since Denver, Colorado became the first to do so in 2019. Oregon has gone a step further and this year became the first state to legalise psilocybin.

The Times contacted representatives for Musk and Brin for comment.

Musk has previously found himself scrutinised over his drug use.

In 2018 he smoked cannabis, which is legal in California but illegal at the federal level,while appearing on an episode of The Joe Rogan Experience podcast, leading to a sharp drop in the Tesla share price.

Musk said that for the next year the federal government subjected him to drug tests as his SpaceX company has contracts with the US.

https://www.thetimes.co.uk/article/elon ... -nrc62xkjp

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