All posts by Mike Price

Bob Goldberg Named CEO of National Association of Realtors®

WASHINGTON (June 23, 2017) – Bob Goldberg has been named CEO of the National Association of Realtors®. Goldberg currently serves as NAR senior vice president of Sales Marketing, Business Development Strategic Investments, Professional Development and Conventions for NAR.

Goldberg was the choice of NAR’s leadership team after an extensive national search. He succeeds Dale Stinton, who is retiring after 36 years at NAR and 12 as CEO. Goldberg has been with NAR since 1995 and will be NAR’s 12th CEO since the association was founded in 1908.

“Bob’s vision, business acumen and unique ability to successfully leverage NAR’s technology investments will ensure Realtors® remain at the center of the real estate transaction,” said 2017 NAR President William E. Brown, a Realtor® from Alamo, California. “With extensive knowledge of the association and real estate industry, Bob brings with him a strong track record for future-based thinking and enacting change, which is why the NAR leadership team is extremely confident in his ability to lead the association and membership to continued future success.”

In his current SVP role, Goldberg is responsible for brand and strategic marketing and association non-dues revenue, and oversees the largest employee base at NAR, with 69 division personnel. He guides a broad range of association initiatives including business development, strategic planning and partnerships, association product and marketing services and management, member professional development, competitive brand positioning, marketing, advertising and promotions, and group conventions.

In addition to his NAR roles, Goldberg also acts as SVP of administration for REALTOR® University, overseeing graduate school staff, day-to-day operations of the research center, curriculum development and budgets. He is also president and CEO of the REALTORS® Information Network, or RIN, an NAR for-profit and wholly owned subsidiary responsible for overseeing the® operating agreement with Move, Inc.

“I’m humbled and excited to be named NAR’s next CEO,” said Goldberg. “This is a dynamic time for the association and the industry, and I am looking forward to my new role and working with Realtor® leaders and staff to advance the association and our members towards long-term success.”

After soliciting and considering recommendations from NAR’s members, the Leadership Team appointed a diverse 15-member search committee in December 2015 to work with executive search firm Heidrick Struggles to recruit candidates for the CEO position. 2015 NAR President Chris Polychron served as the search committee chair, and 2003 NAR President Cathy Whatley served as vice chair.

“Finding a successor for Dale Stinton was far from easy, but it was a challenge our search committee took very seriously. The final candidates, who were all top-notch, brought diverse backgrounds and the right mix of skills, but Bob Goldberg stood apart because of his considerable understanding of and expertise in the many the issues facing the industry and NAR’s members,” said Polychron. “We greatly appreciate Heidrick and Struggles’ insights and assistance throughout the entire selection process and look forward to moving ahead.”

The National Association of Realtors®, “The Voice for Real Estate,” is America’s largest trade association, representing 1.2 million members involved in all aspects of the residential and commercial real estate industries.


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GM settles hundreds of ignition switch lawsuits

NEW YORK General Motors Co (GM.N) has agreed to settle federal lawsuits by as many as 203 plaintiffs over defective ignition switches in its vehicles, a Friday court filing shows.

Settlement terms are confidential, but the accord could also resolve hundreds of state court claims, as well, lawyers for the automaker said in the filing in Manhattan federal court.

Lawyers for the settling plaintiffs could not immediately be reached for comment. A GM spokesman did not immediately respond to a request for comment.

GM has been defending against hundreds of lawsuits over faulty ignition switches that could cause engines to stall and prevent airbags from deploying in crashes.

The defect has been linked to 124 deaths and 275 injuries, and prompted a recall that began in February 2014.

GM has paid about $2.5 billion in penalties and settlements related to the defect.

In April, the U.S. Supreme Court let stand a lower court ruling that blocked GM’s effort to scuttle many private lawsuits.

The Detroit-based automaker had argued that its 2009 bankruptcy reorganization excused it from addressing earlier defects.

GM’s lawyers said they are working with the plaintiffs’ lawyers to complete documentation within the next month for the settlement, whose terms “will take some time” to implement.

The case is In re: General Motors LLC Ignition Switch Litigation, U.S. District Court, Southern District of New York, No. 14-md-02543.

(Reporting by Jonathan Stempel in New York; Editing by Jeffrey Benkoe and Nick Zieminski)

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Exclusive: Wal-Mart not considering a bid for Whole Foods

Wal-Mart Stores Inc is not actively considering making an offer for Whole Foods Market Inc, a source familiar with the matter told Reuters on Friday.

Whole Foods, which accepted a $13.7 billion offer from Inc last week, has not received any rival bids as of Friday, a second source said. Both sources spoke on condition of anonymity because the matter is confidential.

Wal-Mart spokesman Greg Hitt declined to comment on whether the company is considering a bid for Whole Foods. Whole Foods and Amazon did not immediately respond to requests for comment.

Whole Foods shares have been trading above Amazon’s deal price of $42 per share since the deal was announced last Friday, as stock market investors speculate about the possibility of a higher offer.

Whole Foods shares reached a high of $43.84 earlier on Friday, but dropped after Reuters reported that no rival bids have so far emerged. Its shares were last trading after hours at $42.85.

Wal-Mart had been tipped as a potential bidder for Whole Foods by retail analysts, although Hitt previously called reports that Wal-Mart might put in a rival offer “false and baseless.”

Wal-Mart, the world’s largest retailer, has been investing heavily in building its e-commerce business and has been acquiring smaller online companies such as, ModCloth, Moosejaw and Bonobos.

“Bidding for Whole Foods would be a 180-degree turn from what Wal-Mart’s strategy has been for the past two to three years,” said Edwards Jones analyst Brian Yarbrough.

Amazon’s proposed purchase of Whole Foods brings disruption to the $700 billion U.S. grocery sector, a traditional area of retailing that is in the middle of an intense price war.

In preparation for that price war, Wal-Mart in recent months has cut grocery prices, improved its fresh food and meat offerings, modernized shelving and lighting in its grocery department and expanded its online pick-up service.

Whole Foods’ peer Kroger Co, as well as Target Corp and Costco Wholesale Corp, have also been identified by analysts as potential bidders for Whole Foods.

Both Amazon and Whole Foods cater to younger consumers, including millennials, as well as more affluent shoppers.

Whole Foods has said it will continue to operate stores under the Whole Foods Market brand, and that John Mackey will remain chief executive.

(Reporting by Nandita Bose in Chicago and Greg Roumeliotis in New York; Editing by Bill Rigby)

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Oil’s drop could leave a stain on earnings

NEW YORK Heading into second-quarter earnings season, investors are looking for a continuation of strong U.S. company results to justify high stock valuations, now trading near their loftiest levels since 2004.

However, drilling a hole into that hopeful scenario is the current bear market in oil prices and an economy showing signs of growth below the pace expected earlier in the year.

“A lot of the expectation for a recovery in earnings is predicated on oil prices being around $47-$50 a barrel,” said Hugh Johnson, chief investment officer of Hugh Johnson Advisors LLC in Albany, New York. “So if you don’t get those numbers, you don’t get the strong earnings the stock market needs. This is not trivial stuff. It creates a lot of uncertainty and volatility in forecasts.”

U.S. crude futures CLc1 have been pressured lower by a supply glut. They’ve averaged over $48 per barrel so far this quarter, but traded around $43 on Friday and are down more than 20 percent from February, when they hit an 18-month high.

U.S. stocks are in the ninth year of a bull run which has been fueled of late by bets on pro-growth policies from U.S. President Donald Trump. However, with the timetable for reforms stretching further into the future, earnings are seen as a critical support for stock prices.

With indexes near record highs, there is speculation among Wall Street analysts about whether a correction is due.

Earnings expectations have dropped for 10 of 11 industry groups since early April, with only industrials looking better than they did then.

The benchmark SP 500 stock index as a whole is expected to deliver 7.9 percent profit growth, down from 15.3 percent in the first quarter, and below the 10.2 percent forecast in April, Thomson Reuters data shows.

On Thursday, Nike (NKE.N) will be the first Dow component to report earnings for the most recent quarter. The season heats up in the second week of July.

Technology earnings are seen posting double-digit growth, helped by gains in semiconductor companies, and financials are close behind with estimated 8.1-percent profit growth.

While lower energy prices can help some sectors such as industrials and transports, as well as boosting consumer sentiment, high expectations for energy earnings growth mean any stumble will be felt broadly.

Energy sector profits are seen up a whopping 683 percent from a year ago, when many companies posted losses, according to Thomson Reuters data. Without energy, profit growth estimates drop to 4.8 percent for the quarter.

Expectations for the sector will probably have to come down for the second half of the year if low oil prices persist, said David Joy, chief market strategist at Ameriprise Financial in Boston.

“The one wild card right now is the price of oil. Expectations that are baked into full-year forecasts assume a higher price for oil certainly than we have now,” he said.

Energy has been the weakest performing sector so far this year, with the SP energy index .SPNY down near 15 percent.


The drop in oil prices notwithstanding, some analysts have cautioned that Wall Street has been too optimistic about overall earnings.

Michael Purves, chief global strategist at Weeden Co, cut his 2017 SP 500 earnings estimates from $127 to $116, below the $131.51 consensus, as economic growth and inflation are not as high as expected.

“I’m looking for CEOs to start taking down their forecasts for the year,” Purves said.

In fact, the Citigroup U.S. economic surprise index .CESIUSD, a gauge of economic data compared to expectations, this month fell near a six-year low.

An Atlanta Federal Reserve model recently forecast second-quarter economic growth coming in at a 2.9-percent annualized pace, down from a previous 3.2 percent.

Another hurdle for earnings growth: declining corporate buybacks.

“Over the past two years, more than 20 percent of SP 500 issues have given at least a 4 percent tailwind for (earnings per share) via reduced share counts,” Howard Silverblatt, senior index analyst at SP Dow Jones Indices, said in a note.

For the first quarter of 2017, that rate fell to 14.8 percent of companies, and there are indications of “even less support” in the second quarter, he said.

(Additional reporting and editing by Megan Davies; Editing by Daniel Bases and Nick Zieminski)

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Existing-Home Sales Rise 1.1 Percent in May; Median Sales Price Ascends to New High

WASHINGTON (June 21, 2017) — Existing-home sales rebounded in May following a notable decline in April, and low inventory levels helped propel the median sales price to a new high while pushing down the median days a home is on the market to a new low, according to the National Association of Realtors®. All major regions except for the Midwest saw an increase in sales last month.

Total existing-home sales1,, which are completed transactions that include single-family homes, townhomes, condominiums and co-ops, climbed 1.1 percent to a seasonally adjusted annual rate of 5.62 million in May from a downwardly revised 5.56 million in April. Last month’s sales pace is 2.7 percent above a year ago and is the third highest over the past year.  

Lawrence Yun, NAR chief economist, says sales activity expanded in May as more buyers overcame the increasingly challenging market conditions prevalent in many areas. “The job market in most of the country is healthy and the recent downward trend in mortgage rates continues to keep buyer interest at a robust level,” he said. “Those able to close on a home last month are probably feeling both happy and relieved. Listings in the affordable price range are scarce, homes are coming off the market at an extremely fast pace and the prevalence of multiple offers in some markets are pushing prices higher.”

The median existing-home price2 for all housing types in May was $252,800. This surpasses last June ($247,600) as the new peak median sales price, is up 5.8 percent from May 2016 ($238,900) and marks the 63rd straight month of year-over-year gains.

Total housing inventory3 at the end of May rose 2.1 percent to 1.96 million existing homes available for sale, but is still 8.4 percent lower than a year ago (2.14 million) and has fallen year-over-year for 24 consecutive months. Unsold inventory is at a 4.2-month supply at the current sales pace, which is down from 4.7 months a year ago.  

“Home prices keep chugging along at a pace that is not sustainable in the long run,” added Yun. “Current demand levels indicate sales should be stronger, but it’s clear some would-be buyers are having to delay or postpone their home search because low supply is leading to worsening affordability conditions.”

Properties typically stayed on the market for 27 days in May, which is down from 29 days in April and 32 days a year ago; this is the shortest timeframe since NAR began tracking in May 2011. Short sales were on the market the longest at a median of 94 days in May, while foreclosures sold in 48 days and non-distressed homes took 27 days. Fifty-five percent of homes sold in May were on the market for less than a month (a new high).

Inventory data from® reveals that the metropolitan statistical areas where listings stayed on the market the shortest amount of time in May were Seattle-Tacoma-Bellevue, Wash., 20 days; San Francisco-Oakland-Hayward, Calif., 24 days; San Jose-Sunnyvale-Santa Clara, Calif., 25 days; and Salt Lake City, Utah and Ogden-Clearfield, Utah, both at 26 days.

“With new and existing supply failing to catch up with demand, several markets this summer will continue to see homes going under contract at this remarkably fast pace of under a month,” said Yun.

According to Freddie Mac, the average commitment rate for a 30-year, conventional, fixed-rate mortgage decreased for the second consecutive month, dipping to 4.01 percent in May from 4.05 percent in April. The average commitment rate for all of 2016 was 3.65 percent.

First-time buyers were 33 percent of sales in May, which is down from 34 percent in April but up from 30 percent a year ago. NAR’s 2016 Profile of Home Buyers and Sellers — released in late 20164 — revealed that the annual share of first-time buyers was 35 percent.

Earlier this month, NAR hosted the Sustainable Homeownership Conference at University of California’s Memorial Stadium in Berkeley. A white paper titled, “Hurdles to Homeownership: Understanding the Barriers,” was released, which honed in on the five main reasons why first-time buyers are failing to make up a greater share of the market.

“Of the barriers analyzed in the white paper, single-family housing shortages will be the biggest challenge for prospective first-time buyers this year,” said President William E. Brown, a Realtor® from Alamo, California. “Those hoping to buy an entry-level, single-family home continue to see minimal choices. The best advice for these home shoppers is to know what you can afford, lean on the guidance of a Realtor® and act fast once an ideal property within the budget is listed.”

All-cash sales were 22 percent of transactions in May, up from 21 percent in April and unchanged from a year ago. Individual investors, who account for many cash sales, purchased 16 percent of homes in May, up from 15 percent in April and 13 percent a year ago. Sixty-four percent of investors paid in cash in May.  

Distressed sales5 — foreclosures and short sales — were 5 percent of sales in May, unchanged from April and down from 6 percent a year ago. Four percent of May sales were foreclosures and 1 percent were short sales. Foreclosures sold for an average discount of 20 percent below market value in May (18 percent in April), while short sales were discounted 16 percent (12 percent in April).

Single-family and Condo/Co-op Sales

Single-family home sales increased 1.0 percent to a seasonally adjusted annual rate of 4.98 million in May from 4.93 million in April, and are now 2.7 percent above the 4.85 million pace a year ago. The median existing single-family home price was $254,600 in May, up 6.0 percent from May 2016.

Existing condominium and co-op sales climbed 1.6 percent to a seasonally adjusted annual rate of 640,000 units in May, and are 3.2 percent higher than a year ago. The median existing condo price was $238,700 in May, which is 4.8 percent above a year ago.

Regional Breakdown

May existing-home sales in the Northeast jumped 6.8 percent to an annual rate of 780,000, and are now 2.6 percent above a year ago. The median price in the Northeast was $281,300, which is 4.7 percent above May 2016.

In the Midwest, existing-home sales fell 5.9 percent to an annual rate of 1.28 million in May, and are 0.8 percent below a year ago. The median price in the Midwest was $203,900, up 7.3 percent from a year ago.

Existing-home sales in the South rose 2.2 percent to an annual rate of 2.34 million, and are now 4.5 percent above May 2016. The median price in the South was $221,900, up 5.3 percent from a year ago.

Existing-home sales in the West increased 3.4 percent to an annual rate of 1.22 million in May, and are now 3.4 percent above a year ago. The median price in the West was $368,800, up 6.9 percent from May 2016.

The National Association of Realtors®, “The Voice for Real Estate,” is America’s largest trade association, representing 1.2 million members involved in all aspects of the residential and commercial real estate industries.

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NOTE:  For local information, please contact the local association of Realtors® for data from local multiple listing services. Local MLS data is the most accurate source of sales and price information in specific areas, although there may be differences in reporting methodology.

1Existing-home sales, which include single-family, townhomes, condominiums and co-ops, are based on transaction closings from Multiple Listing Services. Changes in sales trends outside of MLSs are not captured in the monthly series. NAR rebenchmarks home sales periodically using other sources to assess overall home sales trends, including sales not reported by MLSs.

Existing-home sales, based on closings, differ from the U.S. Census Bureau’s series on new single-family home sales, which are based on contracts or the acceptance of a deposit. Because of these differences, it is not uncommon for each series to move in different directions in the same month. In addition, existing-home sales, which account for more than 90 percent of total home sales, are based on a much larger data sample — about 40 percent of multiple listing service data each month — and typically are not subject to large prior-month revisions.

The annual rate for a particular month represents what the total number of actual sales for a year would be if the relative pace for that month were maintained for 12 consecutive months. Seasonally adjusted annual rates are used in reporting monthly data to factor out seasonal variations in resale activity. For example, home sales volume is normally higher in the summer than in the winter, primarily because of differences in the weather and family buying patterns. However, seasonal factors cannot compensate for abnormal weather patterns.

Single-family data collection began monthly in 1968, while condo data collection began quarterly in 1981; the series were combined in 1999 when monthly collection of condo data began. Prior to this period, single-family homes accounted for more than nine out of 10 purchases. Historic comparisons for total home sales prior to 1999 are based on monthly single-family sales, combined with the corresponding quarterly sales rate for condos.

2The median price is where half sold for more and half sold for less; medians are more typical of market conditions than average prices, which are skewed higher by a relatively small share of upper-end transactions. The only valid comparisons for median prices are with the same period a year earlier due to seasonality in buying patterns. Month-to-month comparisons do not compensate for seasonal changes, especially for the timing of family buying patterns. Changes in the composition of sales can distort median price data. Year-ago median and mean prices sometimes are revised in an automated process if additional data is received.

The national median condo/co-op price often is higher than the median single-family home price because condos are concentrated in higher-cost housing markets. However, in a given area, single-family homes typically sell for more than condos as seen in NAR’s quarterly metro area price reports.

3Total inventory and month’s supply data are available back through 1999, while single-family inventory and month’s supply are available back to 1982 (prior to 1999, single-family sales accounted for more than 90 percent of transactions and condos were measured only on a quarterly basis).

4Survey results represent owner-occupants and differ from separately reported monthly findings from NAR’s Realtors® Confidence Index, which include all types of buyers. Investors are under-represented in the annual study because survey questionnaires are mailed to the addresses of the property purchased and generally are not returned by absentee owners. Results include both new and existing homes.

5Distressed sales (foreclosures and short sales), days on market, first-time buyers, all-cash transactions and investors are from a monthly survey for the NAR’s Realtors® Confidence Index, posted at

NOTE: NAR’s Pending Home Sales Index for May is scheduled for release on June 28, and Existing-Home Sales for June will be released July 24; release times are 10:00 a.m. ET.

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U.S. regulators, lawmakers support Volcker rule revamp at hearing

WASHINGTON U.S. financial regulators and lawmakers who appeared at a congressional hearing on Thursday generally agreed that the Volcker rule, which restricts banks’ ability to make bets with their own money, needs to be reconsidered.

The rule should focus only on banks that do a lot of trading, said Federal Reserve Governor Jerome Powell, who leads banking regulation for the central bank.

“We believe we have the authority to draw a line between those with the big trading books (and other banks),” he told the Senate Banking Committee. “We could have that group regulated one way and have everyone else regulated less, a lot less.”

Powell was one of five regulators testifying before the committee, days after the U.S. Treasury Department unveiled a plan to revamp or undo many rules enacted after the 2007-2009 financial crisis. Wall Street banks have fought Volcker vigorously, saying it is overly complicated and hurts market liquidity.

The Treasury plan is part of a broader effort by Republican President Donald Trump to cut regulations that he says are holding back economic growth. Democrats and consumer advocates largely oppose the plan, saying it would lead to more reckless behavior by the banking industry.

At the hearing, Democratic Sen. Elizabeth Warren, a fierce critic of Wall Street, described the Treasury’s recommendations as “basically cut-and-paste” from bank lobbyists.

But Sen. Heidi Heitkamp, a moderate Democrat from North Dakota, indicated clear support for re-examining Volcker.

“What I’m hearing today,” she said, “is no one wants to go back, but everybody wants to tailor a rule or find a rule that can in fact accomplish the goal without overly burdening all banks.”

Powell was joined by Keith Noreika, the acting comptroller of the currency, in calling for changes. Even Federal Deposit Insurance Corporation Chairman Martin Gruenberg, the sole holdover from Trump’s Democratic predecessor, Barack Obama, said he was open to some small revisions.

(Reporting by Pete Schroeder; Editing by Lauren Tara LaCapra and Lisa Von Ahn)

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Biggest U.S. banks clear first hurdle in Fed’s annual stress tests

WASHINGTON/NEW YORK The 34 largest U.S. banks have all cleared the first stage of an annual stress test, showing they would be able to maintain enough capital in an extreme recession to meet regulatory requirements, the Federal Reserve said on Thursday.

Although the banks, including household names like JPMorgan Chase Co and Bank of America Corp, would suffer $383 billion in loan losses in the Fed’s most severe scenario, their level of high-quality capital would be substantially higher than the threshold that regulators demand, and an improvement over last year’s level.

“This year’s results show that, even during a severe recession, our large banks would remain well capitalized,” said Fed Governor Jerome Powell, who leads banking regulation for the central bank. “This would allow them to lend throughout the economic cycle, and support households and businesses when times are tough.”

The Fed introduced the stress tests in the wake of the financial crisis to ensure the health of the banking industry, whose ability to lend is considered crucial to the health of the economy.

Since the first test was conducted in 2009, big banks have seen losses abate, loan portfolios improve and profits grow. The banks that now undergo the exam have also strengthened their balance sheets by adding more than $750 billion in top-notch capital, the Fed said.

Banks and their investors have been hoping the improvements would prompt the Fed to allow them to use more capital for stock buybacks and dividends, especially as the Trump administration is seeking to relax financial regulations.

Wall Street analysts and trade groups quickly cheered the results on Thursday, saying regulators should feel comfortable easing tough rules put in place since the financial crisis.

“We see today’s…stress test results as a positive for Trump administration efforts to deregulate the banks,” said Jaret Seiberg, a policy analyst with Cowen Co.

Rob Nichols, president and chief executive officer of the American Bankers Association, said the Fed should consider a number of recommendations recently laid out by the Treasury Department, including making the stress tests more transparent and less frequent.

“From this solid foundation, the focus should now turn to what can be done to help U.S. banks promote economic growth even further,” he said.


Thursday’s results are the first of a two-part exam. It showed whether the banks would meet minimum requirements under the Fed’s methodology, using materials they submitted.

The second portion of the test, to be released on Wednesday, will show whether the Fed approves or denies banks’ capital plans. Banks now have an opportunity to resubmit those plans if they find their own projections were much sunnier than the Fed’s.

Under the Fed’s worst-case stress-test scenario, the U.S. unemployment rate more than doubles to 10 percent.

However, even with the losses in that scenario, the banks’ aggregate level of high-quality capital would still cover 9.2 percent of their risk-weighted assets, according to the Fed. That is much better than the 4.5 percent threshold that regulators demand, and an improvement on the 8.4 percent common equity tier 1 (CET1) capital ratio assessed last year.

Analysts say Citigroup Inc has the most to gain or lose in the stress tests. Shareholders of the fourth-largest U.S. bank have been clamoring for management to buy back more of its stock, which is trading below what its assets are worth. But the bank cannot do so without the Fed’s approval.

Under the Fed’s examination, Citi’s minimum CET1 ratio in the most stressful scenario was the highest among big Wall Street banks, at 9.7 percent. Citi’s own analysis showed that metric at 10 percent.

The Fed’s assessment showed the other five largest banks – JPMorgan, Bank of America, Wells Fargo Co, Goldman Sachs Group Inc and Morgan Stanley – having minimum CET1 ratios between 8.4 and 9.4 percent.

Of those, Goldman Sachs had the biggest optimism gap compared with the Fed when it came to the worst-case scenario. Its model produced a 9.8 percent minimum CET1 ratio, 1.4 points better than the Fed’s. Wells Fargo’s metric also fared better in its own test than under the Fed’s, by 0.8 of a point.

Conversely, JPMorgan’s analysis appeared to be more dour, with its CET1 ratio coming in 1.3 percentage points below the Fed’s. Bank of America’s was 0.7 of a point worse.

Banks that decide to resubmit their plans can only make downward revisions to the amount of capital they plan to use, meaning management teams that were too conservative may regret their submissions even if they pass.

“If there is disappointment next week,” said Seiberg, “it is likely because the banks failed to ask for big enough distributions more than it is because the Federal Reserve was too tough.”

(Reporting by Pete Schroeder in Washington and David Henry in New York; Additional reporting by Patrick Rucker; Writing by Lauren Tara LaCapra; Editing by Leslie Adler)

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Asian shares flat, stay on track for a winning week

TOKYO Asian shares flatlined on Friday but remained on track for a weekly gain, while crude oil prices pulled away from this week’s 10-month lows.

Financial spreadbetter CMC Markets sees European markets opening modestly weaker, with Britain’s FTSE 100 .FTSE, Germany’s DAX .GDAXI and France’s CAC 40 .FCHI all seen shedding points in early trade.

MSCI’s broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS was nearly unchanged on the day, and was up 0.4 percent for the week.

The Shanghai Composite .SSEC slipped 0.7 percent while China’s blue-chip CSI300 index .CSI300 was down 0.3 percent. The latter earlier this week hit an 18-month high on excitement over MSCI’s decision to include mainland shares in a key index.

“Investors have no incentives today to take new positions ahead of the weekend,” said Mitsuo Shimizu, equity strategist at Japan Asia Securities in Tokyo.

Japan’s Nikkei stock index .N225 was slightly higher in afternoon trade, on track to log a rise of 0.9 percent for a week in which it touched its highest levels since August 2015.

“The actual macro situation in Japan is pretty good,” said Ed Rogers, head of Rogers Investment Advisors in Tokyo, who noted the country’s streak of five quarters of positive gross domestic product numbers.

He said the dollar remained bolstered against the yen by the Federal Reserve’s move to hike interest rates last week and leave the door open for further monetary tightening later in the year.

“We’re not seeing global inflation, but we think the Fed will continue to move. That stone’s rolling down the hill,” Rogers said.

Longer-term, that will support the dollar and underpin Japanese shares, he added.

The dollar index .DXY, which tracks the greenback against a basket of six major rivals, was down 0.2 percent at 97.449, though up 0.3 percent for the week.

The euro was up 0.1 percent on the day at $1.1163 EUR= but was down 0.3 percent for the week, while the dollar was steady against the yen at 111.29 JPY=, up 0.4 percent for the week.

“We’re getting close to the end of the month, and fundamentals aside, there will be people selling dollars, so it will be easy for the yen to strengthen next week,” said Mitsuo Imaizumi, Tokyo-based chief foreign exchange strategist for Daiwa Securities.

“We also need to keep an eye on the healthcare debate in Washington, because political turmoil tends to undermine the dollar,” he said.

U.S. Senate Republicans offered a bill on Thursday to overhaul Obamacare, the next phase in the party’s long war against the 2010 law enacted by then-President Barack Obama, though it remained unclear if the bill has enough support to pass the Senate.

On Wall Street overnight, U.S. shares put in a mixed performance, though the SP healthcare index .SPXHC rose 1 percent and hit its fifth consecutive record close following the release of the Senate Republicans’ bill.

U.S. economic data on Thursday showed the number of Americans filing for unemployment benefits rose slightly last week, but remained at levels consistent with a tight labor market. Home prices also increased in April more than expected.

The Mexican peso MXN=D2 added 0.1 percent after soaring 1 percent on Thursday as Mexico’s central bank board raised interest rates, saying it wanted to anchor inflation expectations and take into account last week’s move by the U.S. Federal Reserve to hike borrowing costs.

Crude oil futures pulled further away from this week’s lows, though market sentiment remained fragile amid a global crude glut that has persisted despite OPEC-led output cuts.

Brent crude LCOc1 was up 0.4 percent at $45.40 a barrel. U.S. crude futures CLc1 also rose 0.4 percent to $42.91 a barrel.

Spot gold XAU= added 0.2 percent to $1,252.51 an ounce, moving away from a five-week low touched earlier this week.

(Reporting by Lisa Twaronite; Editing by Eric Meijer and Richard Borsuk)

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Democratic Party More Bankrupt Than Ever

The Democrats’ comprehensive meltdown after their fifth straight election loss is a spectacle worth savoring. They’re vacillating between denial and self-flagellation, between consuming depression and delusional optimism. Some are even blaming hacking for the loss.

Don’t let them fool you; they did not expect carpetbagger Jon Ossoff to lose to Karen Handel in the special election for Georgia’s 6th Congressional District. If they had, they would not have poured unprecedented millions into the race. No one but gambling addicts intentionally waste that kind of money.

For all the talk about President Donald Trump’s being in trouble, the Democratic Party is on the ropes. Democrats are in the minority in the federal and state legislative branches, and they’ve now sustained five consecutive losses in special House elections. The Federal Election Commission reports that the Democratic National Committee raised only $4.3 million in May — the worst May for fundraising since 2003. April efforts were almost as dismal.

I can’t remember the last time I heard Democrats beating themselves up this intensely and openly. “Our brand is worse than Trump,” Rep. Tim Ryan, D-Ohio, said. “We can’t just run against Trump.” Ouch. Other Democratic leaders are signaling signs of mutiny against House Minority Leader Nancy Pelosi.

On the other hand, some Democrats insist these losses are a portent of great things to come. Former Sen. Barbara Boxer says Democrats will do fine in 2018. Likewise, Democratic Congressional Campaign Committee Chairman Ben Ray Lujan says, “The House is in play (in 2018).” He wrote, “I don’t make this statement lightly — I’ve never said it before. … This is about much more than one race.”

But, Rep. Lujan, there hasn’t been just one race; there’ve been five. If Democrats actually have unprecedented grass-roots energy and impressive candidates but still can’t win, what does that say about your party’s predicament?

Then again, Democrats can’t even agree whether Ossoff was a good candidate. They expressed no doubts before the election, especially not to their witless Hollywood sugar daddies when soliciting funds for this mega-hyped wunderkind.

The Democrats are Bankrupt

The Democrats’ problem is that they are intellectually and morally bankrupt, as I argued in my 2006 book, Bankrupt. It’s not that they don’t have policy ideas. It’s that their ideas don’t work, so they just attack and demonize Republicans. Though Trump is often a convenient target, they would (and did) crucify any Republican president in office. And despite the leftward cultural shift of the nation and their virtual monopoly on academia, the mainstream media and Hollywood, their polices are not that popular with the American people, so they can’t afford to be completely honest about them.

Ossoff, for example, was hardly running as a liberal. Why would liberals tout a candidate who wasn’t running as a liberal unless they knew he was pretending? More importantly, why would this darling of the left have run as a moderate — unless he and his party knew he wouldn’t have stood a chance had he run as a liberal Democrat?

The truth is not the Democrats’ friend. They are engaging in stunning deceit over President Trump’s alleged collusion with Russia and claims that he obstructed an investigation. Not only was there no obstruction but also Trump had no incentive to obstruct an investigation into something that didn’t occur.

Even the Democrats’ feigned outrage over Russian “interference with our democracy” is a sham. It would be one thing if the Russians had disseminated lies about Hillary Clinton, but instead they exposed damaging truths about her. Without defending Russian perfidy, did that actually hurt the democratic process in the sense of informing voters? What does harm the democratic process is the Democrats’ assault on the integrity of the voting process, from blocking voter ID laws to facilitating the voting of immigrants who are here illegally. And if Democrats were so committed to the democratic process, they would quit trying to nullify the will of the people with manufactured Hail Mary impeachment attempts.

Now, Their Bankruptcy is Starting to Show

Truth be told, nothing would hurt the Democrats more than an authentic referendum on their policy agenda — a legitimate unfolding of the democratic process they profess to treasure. Knowing this, they do everything they can to make elections about anything but their policies.

They know, for instance, that Obamacare is a failure and a poster child for failed liberal policies. Yet as premiums and deductibles skyrocket and choice and quality of care plummet, they barely concede that it is problematic. Their “policy” argument is to say Republicans want to hurt and kill Americans by repealing and replacing their abominable plan. On taxes, immigration and other policies, we are simply mean-spirited bigots. These tired lies are all they have.

But the Democratic establishment is nothing if not arrogant and unimaginative. Though focus groups and elections reveal that even Democratic voters are sick of these bottomless and unfruitful Russian investigations, they are going to keep beating this dead horse, hoping it comes to life.

Democrats are welcome to fool themselves into believing they’ve dealt Trump a deathblow, but his approval ratings aren’t much lower than when he took office — despite their endless slandering. They have nothing new against Trump. They are just recycling the criticisms they made during the election campaign, which he won.

Let the Democrats keep hallucinating and dissembling. Let them keep lying about Trump — because with every passing day, their bankruptcy is more apparent. But in the meantime, pray that President Trump will resist the temptation to be distracted by these sordid Democratic efforts to undermine our democracy. Instead of focusing too much energy on defending himself, he needs to reignite a fire under the American people — and particularly Republicans — to move forward with his agenda. This week, with his uplifting speech in Iowa and the Senate’s rollout of a health care bill, could be a promising reboot.



David Limbaugh is a writer, author and attorney. His latest book is The True Jesus: Uncovering the Divinity of Christ in the Gospels. Follow him on Twitter @davidlimbaugh and his website at


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GE merges power units as executive who lost out on GE CEO job retires

SEATTLE General Electric Co (GE.N) said on Wednesday it will combine its power and energy distribution businesses to create its largest unit by revenue as the top executive at GE Power announced his retirement after failing to win the conglomerate’s CEO job.

The changes were expected after Steve Bolze, a 24-year GE veteran who heads the power unit, lost out to John Flannery, chief of GE’s Healthcare division, as successor to CEO Jeff Immelt.

Bolze, 54, said he would retire on July 3.

GE said it will add its energy connections business – which provides power distribution and conversion equipment – to GE Power in order to create a unit with $41.9 billion in revenue, making it GE’s largest, accounting for 30 percent of its industrial revenue.

The company named connections chief Russell Stokes, 20-year GE veteran, to lead the combined business, which will keep the name GE Power. Stokes is 45.

GE changes CEOs rarely and the naming of a new leader typically prompts the departure of leaders passed up for the top job. When Immelt took the title in 2001 from retiring CEO Jack Welch, prominent executives including Jim McNerney and Bob Nardelli left. McNerney went on to lead Boeing Co (BA.N) while Nardelli subsequently headed Home Depot Inc (HD.N) and Chrysler.

“The brain drain is more muted this time,” said Deane Dray, an analyst at RBC Capital Markets.

Bolze said in a letter to employees that he had told Immelt he would retire if he was not chosen to lead the company.

GE did not make the list of candidates it was considering for CEO public. Alongside Flannery and Bolze, Dray said it likely included GE Oil and Gas unit head Lorenzo Simonelli and Chief Financial Officer Jeff Bornstein.

Given that Simonelli heads the oil and gas operations, which are soon to be merged with Baker Hughes Inc (BHI.N) to create a new company, and Bornstein was recently named a vice chairman of GE, neither is likely to leave, Dray said. GE declined comment.

Merging the energy connections unit into GE Power is not likely to significantly alter earnings or cash flow, so was not a major concern to investors, Dray added.

GE stock was up 0.9 percent at $28.71 in afternoon trading on the New York Stock Exchange.

GE plans to sell the lighting business that is part of the energy connections unit, reducing revenue. It will report results for the combined GE Power unit in the third quarter.

Flannery, who takes over as CEO on Aug. 1, said on Monday after his appointment was announced that he will conduct a swift review of GE’s businesses and will report the results in “the fall.”

The review will look at GE’s businesses with “no constraint,” but GE’s strategy of making software-related products central its businesses will not change, he said.

(Reporting by Alwyn Scott; Editing by Chizu Nomiyama and Bill Rigby)

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Wall St. dips after Fed rate hike; tech slumps again

NEW YORK A slide in technology stocks pulled down the Nasdaq Composite on Wednesday and the SP 500 ended slightly lower, as investors worried about the pace of economic growth after weaker-than-expected inflation numbers and an interest rate hike from the Federal Reserve.

The Nasdaq cut its loss in more than half in a late rebound, having earlier fallen 1 percent, while financials buoyed the Dow industrials.

The U.S. central bank cited continued U.S. economic growth and job market strength, proceeding with its first tightening cycle in more than a decade.

But some investors worried about the Fed’s hawkish tone and that concerns about rate hikes were being reflected in the tech sector, which has led the SP 500’s nearly 9-percent rally this year.

The tech sector fell 0.5 percent, recovering from steeper losses in the session and coming on the heels of its biggest two-day swoon in nearly a year. Tech remains up 18 percent in 2017.

“I think it’s more of what we saw starting last week, where you have a very crowded trade … If they are going to get more nervous about the stock market, that’s where you are going to see the selling,” said William Delwiche, Investment Strategist at Robert W. Baird Co in Milwaukee.

The Dow Jones Industrial Average rose 46.09 points, or 0.22 percent, to 21,374.56, the SP 500 lost 2.43 points, or 0.10 percent, to 2,437.92 and the Nasdaq Composite dropped 25.48 points, or 0.41 percent, to 6,194.89.

Earlier on Wednesday, data showed U.S. consumer prices unexpectedly fell in May and retail sales recorded their biggest drop in 16 months.

“The kiss of death for tech stocks is negative GDP or a slowdown in the software and equipment component,” said Daniel Morgan, portfolio manager at Synovus Trust in Atlanta. “Hence, the tech sector is selling off on concerns that today’s Fed hike will slow GDP, retarding future tech profit growth.”

Financials, which have underperformed this year and tend to benefit in a rising rate environment, rallied late to close up 0.2 percent. The group had fallen as much as 1.3 percent during the session.

The energy sector dropped 1.8 percent as oil prices weakened. U.S. data showed an unexpectedly large weekly build in U.S. gasoline inventories and International Energy Agency (IEA) data projected a big increase in non-OPEC output in 2018.

The Dow Jones Transport Average index, seen by some as a barometer of economic activity, ended down 0.7 percent.

The Fed clearly outlined a plan to reduce its $4.2-trillion portfolio of Treasury bonds and mortgage-backed securities, most of which were purchased in the wake of the 2007-2009 financial crisis and recession.

“The market should take confidence in the fact that they’re being very transparent in setting clear policy steps in terms of how they normalize the balance sheet,” said Heidi Learner, chief economist for Savills Studley, a unit of Savills Plc, in New York. “Certainly more transparency is a good thing.”

In corporate news, Alexion shares jumped 9.3 percent and were the biggest percentage gainers on the SP 500 after the biotechnology company named Biogen’s chief financial officer as its CFO. Biogen’s stock fell 3.1 percent.

H R Block rose 7.9 percent after the tax preparation service’s quarterly revenue and profit beat analysts’ expectations.

Declining issues outnumbered advancing ones on the NYSE by a 1.13-to-1 ratio; on Nasdaq, a 1.41-to-1 ratio favored decliners.

About 7.1 billion shares changed hands in U.S. exchanges, above the 6.8 billion daily average over the last 20 sessions.

(Additional reporting by Rodrigo Campos and Herb Lash in New York and Yashaswini Swamynathan in Bengaluru; Editing by Nick Zieminski and Jeffrey Benkoe)

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Fed raises rates, unveils balance sheet cuts in sign of confidence

WASHINGTON The Federal Reserve raised interest rates on Wednesday for the second time in three months and said it would begin cutting its holdings of bonds and other securities this year, signaling its confidence in a growing U.S. economy and strengthening job market.

In lifting its benchmark lending rate by a quarter percentage point to a target range of 1.00 percent to 1.25 percent and forecasting one more hike this year, the Fed seemed to largely brush off a recent run of mixed economic data.

The U.S. central bank’s rate-setting committee said the economy had continued to strengthen, job gains remained solid and indicated it viewed a recent softness in inflation as largely transitory.

The Fed also gave a first clear outline on its plan to reduce its $4.2 trillion portfolio of Treasury bonds and mortgage-backed securities, most of which were purchased in the wake of the 2007-2009 financial crisis and recession.

It expects to begin the normalization of its balance sheet this year, gradually ramping up the pace. The plan, which would feature halting reinvestments of ever-larger amounts of maturing securities, did not specify the overall size of the reduction.

“What I can tell you is that we anticipate reducing reserve balances and our overall balance sheet to levels appreciably below those seen in recent years but larger than before the financial crisis,” Fed Chair Janet Yellen said in a press conference following the release of the Fed’s policy statement.

She added that the balance sheet normalization could be put into effect “relatively soon.”

The initial cap for the reduction of the Fed’s Treasuries holdings would be set at $6 billion per month, increasing by $6 billion increments every three months over a 12-month period until it reached $30 billion per month.

For agency debt and mortgage-backed securities, the cap will be $4 billion per month initially, rising by $4 billion at quarterly intervals over a year until it reached $20 billion per month.

U.S. stocks edged lower and prices of U.S. Treasuries pared gains after the Fed’s policy statement. The dollar .DXY was largely flat against a basket of currencies after reversing earlier losses, while the price of gold fell.

“The Fed announcing an update to their reinvestment principles leaves September open (for) the start of balance sheet runoff, and the fact that they haven’t slowed their projected path of rate hikes suggest they can do both balance sheet and rate hikes at the same time,” said Gennadiy Goldberg, interest rate strategist at TD Securities.


The Fed has now raised rates four times as part of a normalization of monetary policy that began in December 2015. The central bank had pushed rates to near zero in response to the financial crisis.

Fed policymakers also released their latest set of quarterly economic forecasts, which showed only temporary concern about inflation and continued confidence about economic growth in the coming years.

They forecast U.S. economic growth of 2.2 percent in 2017, an increase from the previous projection in March. Inflation was expected to be at 1.7 percent by the end of this year, down from the 1.9 percent previously forecast.

A retreat in inflation over the past two months has caused jitters that the shortfall, if sustained, could alter the pace of future rate hikes. But the Fed maintained its forecast for three rate hikes next year.

The Fed’s preferred measure of underlying inflation has retreated to 1.5 percent, from 1.8 percent earlier this year, and has run below the central bank’s 2 percent target for more than five years.

Earlier on Wednesday, the Labor Department reported consumer prices unexpectedly fell in May, the second drop in three months.

Yellen indicated the Fed still remained confident inflation would rise to its target over the medium term, bolstered by what she described as a robust labor market that is continuing to strengthen.

The Fed’s estimates for the unemployment rate by the end of this year moved down to 4.3 percent, the current level, and to 4.2 percent in 2018, indicating the Fed believes the labor market will continue to tighten.

The median estimate of the long-run neutral rate, which is seen as the level of monetary policy that neither boosts nor slows the economy, was unchanged at 3.0 percent.

Minneapolis Fed President Neel Kashkari dissented in Wednesday’s decision.

(Reporting by Lindsay Dunsmuir and Howard Schneider; Editing by Paul Simao)

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Unbelievable? Interview With Justin Brierley About His New Book

Justin Brierley is the host of “Unbelievable?,” the U.K.-based apologetics radio/podcast show (which is one of my personal favorites!). I have had the privilege of being on the program twice to discuss the martyrdom of the apostles and talk about why I am a Christian with Ryan Bell, the pastor-turned-atheist.

For over ten years, Justin has been leading discussions between Christians and atheists, and yet he still believes in God. This Thursday he releases a new book Unbelievable?, which I had the privilege to endorse. In the U.K., it is available here: Brierley offers some lessons from his conversations as well as the evidence he finds most compelling. Check out this interview and consider ordering a copy of his excellent book:

Sean McDowell: My guess is that a lot of people believed your show “Unbelievable?” wouldn’t be successful? Yet it has! Why do you think it has been so well received?

Justin Brierley: The show brings together Christian and non-Christian points of view. And when it began on Premier Christian Radio, there were plenty of Christian listeners who didn’t appreciate hearing atheists on their airwaves! But, as it turns out, there were also plenty of believers who wanted to break out of the Christian “bubble” and learn how to engage fruitfully with skeptics.

Then, when we began podcasting the show, it really took off around the world, as both Christians and non-Christians started to download it. The people who listen tend to be those who enjoy high quality discussions in which the other side really gets made to work hard to defend their worldview.

The comment I frequently get from folk who listen in the States (both Christian and non-Christian) is, “We don’t have anything like this on our radio stations,” so I think it meets a need for better quality conversations than we often hear in our media.

McDowell: What are some insights you’ve learned from moderating controversial conversations between Christians and people of opposing views?

Brierley: First, that there’s no need to be afraid, even when we encounter powerful objections.

The new atheists aren’t bringing objections to faith that are actually all that new. Someone somewhere will have thought about it and made a response! If you hear a strong objection for the first time, then be patient and look into it, and then respond. Too often Christians respond out of fear rather than love when they hear their faith being attacked.

Over time, after hearing so many objections, I’ve learned to understand that there are only a limited number of them, and they often fall under a particular category. That give me the confidence to mentally sort and sift objections without having a knee-jerk response.

Second, the way we have the conversation is just as important as the arguments we make.

It’s sometimes said that you can win the argument but still lose the person. I’ve seen some great debaters who were terrible advocates for Christianity because of the way they conduct themselves. Treating people with the “gentleness and respect,” advised by 1 Peter 3:15, means that they are much more likely to listen to you. And that actually works both ways — for both Christians and skeptics who want to persuade people.

McDowell: Given your experience hosting radio debates, what do you think are the most important traits for Christians to be effective communicators today?

Brierley: I think many Christians need to learn the art of having a good conversation.

We live in an age where people are far less willing to be “talked down to” than they used to be. Nowadays, in education, work projects and many areas of life we expect to be included in a dialogue rather than told what to think. Unfortunately, many Christians take the same approach to talking to non-believers as the preaching they see modeled in church. But that won’t do, as it will often feel like a lecture and rankles with most people outside a church context.

That’s why I think the typical debate format (where each side takes an allotted amount of time) is also starting to be replaced by public conversations that are more like the “Unbelievable?” format. It’s more natural and relational, and you end up learning more both about the topic and the people involved.

So Christians need to learn to both speak and listen more in order to have good conversations. We need to be wary of thinking that having longwinded arguments on social media will do any good (I think they have very limited value). Maybe spend that time actually plugging in with a person in “real life.” That’s how the vast majority of people in the history of the world have come to faith!

Finally, when you do try to persuade people that Christianity makes sense, keep the main thing the main thing. There are a million different things we can disagree about, but if there is a God and Jesus rose from the dead, then a lot of the rest is secondary.

McDowell: You have a new book coming out called Unbelievable? Why, after ten years of talking with atheists, I’m still a Christian. There’s a ton of apologetics books available now, so what makes this one unique?

Brierley: Hopefully this book will be of interest to those who have listened to “Unbelievable?,” as it will give you an insight into many of the conversations and people who have been on the show. For example, how I finally managed to bag an interview with Richard Dawkins after years of trying!

I think it will also be interesting for those who have heard me in the role of a neutral moderator for a long time, to find out what I think are the strongest arguments for Christianity and how I’ve handled the objections personally too.

For those who have never heard of the show however, I hope it will still be a helpful resource as it presents arguments for God and Christianity in the context of real conversations, Often we tend to be presented with a pre-packaged sort of apologetics. Real life is never that simple however. It’s helpful to see what this stuff looks like when there is someone pushing back.

At the same time, I think that my experience moderating and communicating the discussions over so many years has given me an ability to convey arguments for faith in an understandable way. There are many apologetics books that don’t appeal to “ordinary” Christians, but I hope this one will.

Lastly, I also wrote this with the non-believing reader in mind. My hope is that, just as both Christians and non-Christians listen to the show, this book will be accessible to both as well.

McDowell: What do you think are the toughest questions skeptics raise to Christians? And what are some helpful points you would offer in response?

Brierley: The toughest questions are usually the ones that have been around the longest and asked the most frequently. For me that would be the problem of why a Loving God allows evil and suffering. It’s a question on many minds here in the U.K. following two dreadful terror attacks.

When responding to that question, it’s important to establish why it’s being asked. For someone who is going through pain or a tragedy, they probably don’t need a logical answer at the point. They need to be loved and cared for.

But when the time does come for answers, then it’s always worth pointing out that we don’t really solve the problem of suffering by getting rid of God. While suffering in a Christian context is certainly a mystery, on atheism it is simply meaningless.

I think we also need to be prepared to challenge people’s picture of God. Many people come to the question assuming that God’s job is essentially that of a divine childminder — keeping us safe, secure and comfortable. But if God’s primary purpose is to bring people into a meaningful relationship with Him, then it may be that he can work through suffering as part of that. It is often only through difficult circumstances that people come to trust in God, whereas we forget about God when our lives are comfortable.

Ultimately, the most profound thing we can offer to anyone is that God knows what it is like to suffer. Christianity is unique among all the religions and worldviews for its claim that God himself suffered with and us and for us on the cross. That doesn’t answer all our questions but it has inspired countless people to hold on through pain.



Sean McDowell, Ph.D., is a professor of Christian Apologetics at Biola University, best-selling author, popular speaker, part-time high school teacher and the Resident Scholar for Summit Ministries, California. Follow him on Twitter: @sean_mcdowell and his blog:

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VA Secretary Says This Bureaucratic Fix Could Help Prevent Veteran Suicides

The Department of Veterans Affairs and Defense Department will soon have the same medical data, ending a turf battle for what Veterans Affairs Secretary David Shulkin said will bring “seamless” information.

Shulkin said having an electronic health record, or EHR, that follows a veteran from the time he enlists could address the problem of veteran suicides.

“My top clinical priority is to reduce veteran suicide,” Shulkin told reporters last week during a White House press briefing. “One of the areas that we’ve identified is a gap in the transition, when you leave the military and all of a sudden you no longer have that structure that you were used to, and what happens to you before you get enrolled into either VA health care or community health care.”

He added:

That no longer is going to happen. We’re going to have a seamless ability to make sure that information is there. So to a veteran who’s experiencing emotional disorders, when they reach out for help it’s going to be easier to get them help. For other people who have physical problems, that same information is going to be there, so you can develop a coordinated care plan.

The VA and DOD currently have separate but interoperable systems, which means the two systems are designed to share electronic health records. The change is that now both departments will share the same records system.

For the past 17 years, members of Congress, and seven blue ribbon commissions, have called for modernizing and integrating the Defense Department and VA medical records system, Shulkin said. This will allow a “seamless link between the departments without the manual or electronic exchange of information,” he said.

Shulkin told The Daily Signal during the briefing that governmental turf wars have delayed a more immediate fix.

“One of the things that we’re doing differently in this administration is that we’re essentially eliminating some of the silos and turf battles,” Shulkin said. “If you put the veteran and the service member first, you would come to the conclusion that we’ve come to today. But nobody likes to give up power and control over their system.”

He added that his department is proud of having developed the first major electronic medical record system.

“This was done over 30 years ago by brave clinicians who went on their own and developed this,” he said. “So giving this up, I do not want to underestimate how difficult that will be for people in the Department of Veterans Affairs. Change is not easy. But when you’ve had that for 30 years, it’s going to be really hard. So this is a major decision for the Department of Veterans Affairs.”

The VA is moving away from its Veterans Health Information Systems and Technology Architecture, or VistA, developed in the 1970s, and will adopt the DOD’s Cerner Millennium MHS GENESIS system. In doing so, the VA is forgoing a competitive bid process.

“I’m not willing to put this decision off any longer; I think 17 years has been too long,” Shulkin said. “When DOD went through its decision on electronic medical records and its acquisition process in 2014, it took them approximately 26 months to do this, and I will tell you, in government terms, that’s actually a pretty efficient process. I don’t think we can wait that long when it comes to the health of our veterans.”


Fred Lucas is the White House correspondent for The Daily Signal. Send an email to Fred. @FredLucasWH

Copyright 2017 The Daily Signal

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Verizon closes Yahoo deal, Mayer steps down

Verizon Communications Inc (VZ.N) said on Tuesday it closed its $4.48 billion acquisition of Yahoo Inc’s (YHOO.O) core business and that Marissa Mayer, chief executive of the internet company, had resigned.

The completion of the acquisition marks the end of the line for Yahoo as a standalone internet company, a storied tech pioneer once valued at more than $100 billion.

Verizon, the No. 1 U.S. wireless operator, is combining Yahoo with AOL, which it bought two years ago, to form a new venture called Oath, led by AOL CEO Tim Armstrong. Oath’s more than 50 brands include HuffPost, TechCrunch and Tumblr.

“Given the inherent changes to my role, I’ll be leaving the company,” Mayer wrote in an email to employees on Tuesday that she also posted on Tumblr. “However, I want all of you to know that I’m brimming with nostalgia, gratitude, and optimism.”

The closing of the deal, announced in July, had been delayed as the companies assessed the fallout from two data breaches that Yahoo disclosed last year.

Reuters reported last week that Verizon plans to cut about 2,000 jobs, or 15 percent, of the 14,000 employees at its Yahoo and AOL units. Verizon is expected to make cuts as early as Wednesday. Yahoo cut 15 percent of its workforce last year and AOL cut 500 jobs.

On June 16, the remainder of Yahoo not acquired by Verizon will be renamed Altaba Inc, a holding company whose primary assets will be its 15.5 percent stake in Alibaba Group Holding Ltd (BABA.N) and a 35.5 percent holding in Yahoo Japan Corp (4689.T).

Thomas McInerney, a Yahoo board member, will become Altaba’s chief executive officer.

(Reporting by Anya George Tharakan in Bengaluru and David Shepardson in Washington; Editing by Saumyadeb Chakrabarty and Bill Rigby)

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Fed set to raise interest rates, give more detail on balance sheet wind-down

WASHINGTON The U.S. Federal Reserve is widely expected to raise its benchmark interest rate this week due to a tightening labor market and may also provide more detail on its plans to shrink the mammoth bond portfolio it amassed to nurse the economic recovery.

The central bank is scheduled to release its decision at 2 p.m EDT (1800 GMT) on Wednesday at the conclusion of its two-day policy meeting. Fed Chair Janet Yellen is due to hold a press conference at 2:30 pm EDT (1830 GMT).

“The expectation of a rate hike…is widely held, and has been reinforced by the most recent round of Fed communications,” said Michael Feroli, an economist with J.P. Morgan.

Economists polled by Reuters overwhelmingly see the Fed raising its benchmark rate to a target range of 1.00 to 1.25 percent this week.

The Fed embarked on its first tightening cycle in more than a decade in December 2015. A quarter percentage point interest rate rise on Wednesday would be the second nudge upwards this year following a similar move in March.

Since then, the unemployment rate has fallen to a 16-year low of 4.3 percent and economic growth appears to have reaccelerated following a lackluster first quarter.

However, other indicators of the economy’s health have been more mixed. The Fed’s preferred measure of underlying inflation has retreated to 1.5 percent from 1.8 percent earlier in 2017 and investors are growing increasingly doubtful policymakers will be able to stick to their anticipated pace of tightening of three interest rate rises this year and next.

There are also growing doubts on the size and scope of fiscal stimulus the Trump administration may inject into the U.S. economy with campaign promises on tax reform, financial regulation rollbacks and infrastructure spending either still on the drawing board or facing hurdles in Congress.


Fed policymakers’ confidence in their outlook will be on show on Wednesday when they release their latest set of quarterly projections on growth, unemployment and inflation as well as their expected rate hike path.

Few economists expect major changes in the Fed’s overall forecasts this time around, although the extent of jitters on inflation moving away from the Fed’s 2 percent goal will likely be reflected at an individual level.

Markets are, however, increasingly anxious for the Fed to give a clearer steer on the timing and details of its previously announced plan to reduce this year its $4.2 trillion portfolio of Treasury debt and mortgage-backed securities, most of which were purchased in the wake of the financial crisis to help keep rates low and bolster the economy.

“If the Fed is serious about reducing the size of its balance sheet this year and wishes to communicate those plans well in advance, it is running out of time to do so,” said Michael Pearce, an economist with Capital Economics.

More detail could come as part of the policy statement or during Yellen’s press conference. The central bank used the minutes of its last policy meeting to flag up a plan that would feature halting reinvestments of ever-larger amounts of maturing securities.

Under the proposal, a limit would be set on the amount of securities allowed to fall off the balance sheet every month. Initially, the cap would be set at a low level, but every three months the Fed would raise it, allowing deeper cuts to its holdings.

The Fed has yet to indicate the size of the monthly caps or their quarterly increases. After this week’s meeting, policymakers meet four more times this year, with the Fed seen actually reducing its holdings either in September or December.

(Reporting by Lindsay Dunsmuir; Editing by Andrea Ricci)

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Tech recovery sends Wall St. to records with Fed next

Wall Street gained on Tuesday, with the SP 500, Dow industrials and Russell 2000 setting record closing highs, as technology stocks bounced back and investors positioned for an expected Federal Reserve interest rate hike.

The SP 500 technology sector .SPLRCT rose 0.9 percent, recovering from its biggest two-day decline in nearly a year that also weighed on the broader market. Big tech names, such as Microsoft (MSFT.O) and Facebook (FB.O), pushed the SP 500 higher.

“I think the fall the last two days has been due to psychology not to any fundamentals, and today you’re seeing some people step back in and buy again,” said Peter Tuz, president of Chase Investment Counsel in Charlottesville, Virginia. “Fundamentals look good.”

Tech has led the benchmark SP 500’s 9-percent rally this year, and its recent swoon has sparked speculation that investors may be rotating into other swaths of the market that have lagged in 2017, such as financials and energy.

Financials .SPSY gained 0.4 percent on Tuesday, while energy .SPSY gained 0.7 percent. Materials .SPLRCM were the top gaining sector, rising 1.3 percent.

Tuesday’s market action reflected “a continuation of running up some of the areas that have not participated over the course of the last few months, in combination with some speculation that the Fed is going to be more resolute about raising rates than investors had begun to anticipate in the bond market,” said Bruce McCain, chief investment strategist at Key Private Bank in Cleveland.

The Dow Jones Industrial Average .DJI rose 92.8 points, or 0.44 percent, to 21,328.47, the SP 500 .SPX gained 10.96 points, or 0.45 percent, to 2,440.35 and the Nasdaq Composite .IXIC added 44.90 points, or 0.73 percent, to 6,220.37.

Traders are overwhelmingly expecting an interest rate increase when the Fed concludes its two-day meeting on Wednesday.

The central bank is scheduled to release its decision at 2 p.m EDT (1800 GMT) on Wednesday with a news conference to follow from Fed Chair Janet Yellen.

Financials, which tend to benefit when rates are rising, also climbed after the U.S. Treasury Department announced a plan to upend the country’s financial regulatory framework, which would grant many items on Wall Street’s wishlist.

In corporate news, Cheesecake Factory (CAKE.O) shares fell 9.9 percent after the restaurant chain warned of a decline in comparable store sales.

Advancing issues outnumbered declining ones on the NYSE by a 2.39-to-1 ratio; on Nasdaq, a 1.89-to-1 ratio favored advancers.

About 6.4 billion shares changed hands in U.S. exchanges, below with the 6.8 billion daily average over the last 20 sessions.

(Additional reporting by Sruthi Shankar and Yashaswini Swamynathan in Bengaluru; Editing by Anil D’Silva and Nick Zieminski)

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Uber CEO Kalanick likely to take leave, SVP Michael out: source

SAN FRANCISCO Uber Technologies Inc [UBER.UL] Chief Executive Travis Kalanick is likely to take a leave of absence from the troubled ride-hailing company, but no final decision has yet been made, according to a source familiar with the outcome of a Sunday board meeting.

Emil Michael, senior vice president and a close Kalanick ally, has left the company, the source said.

At the Sunday meeting, the company’s board adopted a series of recommendations from the law firm of former U.S Attorney General Eric Holder following a sprawling, multi-month investigation into Uber’s culture and practices, according to a board representative.

Uber will tell employees about the recommendations on Tuesday, said the representative, who declined to be identified.

The company is also adding a new independent director, Nestle executive and Alibaba board member Wan Ling Martello, a company spokesman said.

Holder and his law firm were retained by Uber in February to investigate company practices after former Uber engineer Susan Fowler published a blog post detailing what she described as sexual harassment and a lack of a suitable response by senior managers.

The recommendations in Holder’s firm’s report place greater controls on spending, human resources and other areas where executives led by Kalanick have had a surprising amount of autonomy for a company with more than 12,000 employees, sources familiar with the matter said.

Kalanick and two allies on the board have voting control of the company. Kalanick’s forceful personality and enormous success with Uber to date, as well as his super-voting shares, have won him broad deference in the boardroom, according to the people familiar with the deliberations.

Any decision to take a leave of absence will ultimately be Kalanick’s, one source said.

The world’s most valuable venture-backed private company has found itself at a crossroads as its rough-and-tumble approach to local regulations and handling employees and drivers has led to a series of problems.

It is facing a criminal probe by the U.S. Department of Justice over its use of a software tool that helped its drivers evade local transportation regulators, sources have told Reuters.

Last week, Uber said it fired 20 staff after another law firm looked into 215 cases encompassing complaints of sexual harassment, discrimination, unprofessional behavior, bullying and other employee claims.


Even a temporary departure by Kalanick would be a shock for the Silicon Valley startup world, where company founders in recent years have enjoyed more autonomy and often become synonymous with their firms.

Uber’s image, culture and practices have been largely defined by Kalanick’s brash approach, company insiders and investors previously told Reuters.

Uber board member Arianna Huffington said in March that Kalanick needed to change his leadership style from that of a “scrappy entrepreneur” to be more like a “leader of a major global company.” The board has been looking for a chief operating officer to help Kalanick run the company since March.

The debate over Kalanick’s future comes as he is also facing a personal trauma: His mother died last month in a boating accident, in which his father was also badly injured.

Michael, described by employees as Kalanick’s closest deputy, has been a recurring flashpoint for controversy at the company.

He once discussed hiring private investigators to probe the personal lives of reporters writing stories faulting the company. Kalanick disavowed and publicly criticized the comments.

Michael will be replaced as the company’s top business development executive by David Richter, currently an Uber vice president, the company spokesman said.

Alongside Uber’s management crisis, its self-driving car program is in jeopardy after a lawsuit from Alphabet Inc alleging trade secrets theft, and the company has suffered an exodus of top executives.

One Uber investor called the board’s decisions on Sunday a step in the right direction, giving Uber an “opportunity to reboot.”

(Reporting by Heather Somerville and Joseph Menn; Editing by Bill Rigby and Meredith Mazzilli)

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GE wins U.S. antitrust approval for Baker Hughes purchase

WASHINGTON General Electric Co (GE.N) won U.S. antitrust approval to merge its oil and gas business with Baker Hughes Inc (BHI.N), the Justice Department said on Monday.

GE and Baker Hughes announced the deal in October, months after Halliburton’s effort to buy Baker Hughes collapsed under pressure from the Justice Department’s Antitrust Division. Under the agreement, GE will combine Baker Hughes with its oil and gas business to create a publicly traded company.

Following news of the antitrust approval, shares of Baker Hughes added slightly to gains and were up 1.1 percent to $56.14.

The deal was approved on condition that GE sell its Water Process Technologies business, the department said. The asset sale was required because GE and Baker Hughes are two of four companies that sell refineries the specialized chemicals they need to remove impurities from hydrocarbons, the department said in a court filing.

Baker Hughes has some 35 percent of the market for refinery process chemicals, while GE has about 20 percent, the department said in a court filing.

(Reporting by Diane Bartz; Editing by Peter Cooney)

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Tech pulls Wall Street lower; Apple slides

NEW YORK Apple shares added to last week’s drop on Monday to lead a stock market decline as technology, still the best performing SP 500 sector this year, succumbed under its own weight.

The Dow Jones Industrial Average .DJI fell 36.16 points, or 0.17 percent, to 21,235.81, the SP 500 .SPX lost 2.36 points, or 0.10 percent, to 2,429.41 and the Nasdaq Composite .IXIC dropped 32.45 points, or 0.52 percent, to 6,175.47.

(Reporting by Rodrigo Campos; Editing by Nick Zieminski)

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Gov Signs Bill That Would Put Prayer Back Into Florida Schools

Florida Republican Gov. Rick Scott signed a bill Friday that protects students’ right to lead prayers and religious gatherings in Florida schools, despite ardent criticism from the left.

The Florida Student and Personnel Religious Liberties Act, or SB 436, ensures that students of every grade in Florida schools have the right to pray, lead prayers, and organize and participate in religious activities and organizations before, during, and after school, without fear of discrimination or punishment. The bill also affords school faculty the right to participate in student initiated religious activities.

The bill proved contentious, according to a report from the Bradenton Herald, as Democrats in the Florida legislature cited concerns that the bill would foster alienation of and discrimination against specifically non-Christian students. This sentiment echoes Vermont Independent Sen. Bernie Sanders’ recent scolding of a Christian nominee for Deputy Budget Director.

Democratic state Sen. Kevin Rader labeled the bill “religiously coercive, divisive, and unconstitutional.”

Republican state Sen. Dennis Baxley, the author of the bill, disagreed. “Part of what we’re protecting is those basic rights for religious expression, which are protected speech,” Baxley said. “And we’re letting people know it doesn’t stop at the property line of the school site. We owe our educators some clarity on this so it can be applied uniformly across the state in a way that respects all faiths.”

The bill has also drawn harsh criticism from outside the Florida legislature, with the Anti-Defamation League, an organization devoted to fighting antisemitism, and Equality Florida, an LGBT advocacy group, expressing concerns that the bill would actually encourage Christians to use religion as a tool of discrimination.

“I don’t think we’re the ones that are intolerant at this stage,” Baxley told the Miami Herald. “Maybe that was true at some point in history, but right now, that’s not where the intolerance is coming from.”

While some argued that the bill was redundant, as the U.S. Constitution already protects the free exercise of religion, proponents of the bill, like Republican state Sen. Rob Bradley, expressed a need for clearer protection of that right in what they see as a growing climate of hostility toward persons of faith.

“The pendulum has swung way, way too far, to a situation where teachers, parents, and students are afraid to express things that are important to them, their core beliefs,” Bradley said.

The religious liberty bill passed through the state legislature, despite its controversy, as part of a package deal to pass another bill that modifies to Florida’s “Stand Your Ground Law.”



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9th Circuit Upholds Injunction on Trump’s Second Travel Ban

The 9th U.S. Circuit Court of Appeals upheld an injunction barring enforcement of key provisions of President Donald Trump’s second executive order on refugees and migrants Monday, finding the president exceeded his lawful authority in issuing the directive.

The 9th Circuit’s decision comes as the Supreme Court reviews a petition submitted by the Department of Justice to review a separate ruling from the 4th Circuit, which also barred enforcement of the order.

The ruling keeps two provisions of the order from taking effect: the first suspends migration from six countries with high instances of terror, and the second reduces the number of refugees the U.S. will accept from 110,000 to 50,000.

“[I]mmigration, even for the President, is not a one-person show,” the court wrote. “The President’s authority is subject to certain statutory and constitutional restraints. We conclude that the President, in issuing the Executive Order, exceeded the scope of the authority delegated to him by Congress.”

The 9th Circuit’s ruling is largely restricted to a textual analysis of the relevant immigration law, unlike other federal courts who have concentrated their inquiry on constitutional arguments. The court argues that a careful reading of the Immigration and Nationality Act — the law the administration cites to justify the legality of the travel ban — reveals that the administration has not shown that the order is lawful.

The court explains:

Section 1182(f) requires that the President find that the entry of a class of aliens into the United States would be detrimental to the interests of the United States. This section requires that the President’s findings support the conclusion that entry of all nationals from the six designated countries, all refugees, and refugees in excess of 50,000 would be harmful to the national interest. There is no sufficient finding in EO2 that the entry of the excluded classes would be detrimental to the interests of the United States.

The court discusses at some length the various ways in which the administration failed to show that migrant and refugee entry would be detrimental to the national interest; among other claims, the court says the order does not show that nationality alone makes one at heightened security risk, or that current vetting procedures are inadequate for national security.

The court also points out that the order is, in some ways, under inclusive, as it would not hinder a terrorist who was radicalized in one of the six countries named in the order, but was born some place else.

Though the ruling comes as the Supreme Court is grappling with the travel ban litigation arising from the 4th Circuit, it is still a major development. The 4th Circuit’s ruling found that Trump’s order creates the perception that the administration’s purpose is to pursue a policy that disparages Muslims, a violation of the Constitution’s ban on establishing religion.

This ruling put the Supreme Court in a difficult position. The justices will generally avoid weighing in on constitutional questions when it can, — especially where those questions are novel or controversial — and are loath to take up ongoing political controversies. The 9th Circuit’s ruling provides a basis for the high court to leave the travel ban on hold without engaging the contentious constitutional issues the 4th Circuit raises.

This is breaking news. Check back for updates as more information becomes available.



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Airbus may look beyond UK unless Brexit demands met

LONDON Airbus (AIR.PA) could move production of new aircraft models out of Britain if the European plane-maker’s “non-negotiable” demands over the free movement of people and trade tariffs are not delivered in upcoming Brexit talks, the Sunday Times reported.

Britain is due to begin negotiations with the rest of the European Union about the terms of its departure in nine days time, despite Prime Minister Theresa May being weakened by losing her majority in Thursday’s election.

Fabrice Bregier, chief operating officer of Airbus, said a deal must allow its staff from all over the world to enter Britain easily, ensure that parts are exempt from trade tariffs and ensure certain regulatory standards are maintained.

Otherwise, he said, Britain would risk losing Airbus production in the future. “For new productions, it’s very easy to have a new plant somewhere in the world. We would have plenty of offers to do that,” Bregier said, according to the newspaper.

“We want to stay in the UK — provided the conditions to work in an integrated organization are met.”

May might be forced to reassess her Brexit priorities after being weakened by the election. She has previously said she wants Britain to withdraw from Europe’s custom union as well as its single market. She has also said no deal would be better than a bad deal, implying she could accept tariffs on imports and exports.

Airbus Chief Executive Tom Enders said on Thursday that a “hard Brexit” where trade tariffs between the UK and European Union were imposed could potentially impact the competitiveness of the firm’s activities in Britain.

Airbus employs over 10,000 people across two plants in Britain, according to the company’s website.

(Reporting by Alistair Smout; Editing by Bill Rigby)

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Sirius to invest $480 million in Pandora, may be path to music streaming

Sirius XM Holdings Inc (SIRI.O) said on Friday it will invest $480 million in Pandora Media Inc (P.N), giving the satellite radio company better exposure to internet music streaming while providing financial footing to Pandora.

While Sirius XM has a strong presence in the auto market, where its channels are offered in most new cars in the United States, it has trailed Pandora and other music providers in mobile and streaming content. The relationship could give Sirius expertise in expanding its listening base outside of the car.

“We believe there are future opportunities to accelerate Pandora’s growth and further increase stockholder value,” Sirius XM Chief Executive Officer Jim Meyer said in a statement.

While the companies did not provide details about how they would work together, Barclays analyst Kannan Venkateshwar said Sirius XM could bundle Pandora services to its customers, similar to how Amazon (AMZN.O) sells HBO and Showtime subscriptions.

Pandora CEO Tim Westergren said the investment “infuses resources to help Pandora continue to grow and innovate.”

Pandora’s shares have lost more than 30 percent over the past 12 months, and the company has never turned a profit on an annual basis.

As of Friday, Pandora’s market capitalization of approximately $2 billion was dwarfed by Sirius XM’s $25 billion.

Sirius XM, controlled by media mogul John Malone’s Liberty Media Corp (FWONA.O) will receive three board seats and appoint the chairman. Sirius is prevented from buying additional Pandora stock for 18 months and will not buy more than 31.5 percent of Pandora after that period.

The deal ends a strategic review by Pandora and should ease pressure from activist investor Corvex Management LP that goes back more than year. The deal is a “new opportunity” for Pandora that raises its value, Corvex CEO Keith Meister told CNBC on Friday.

The investment also ends an earlier agreement for KKR Co (KKR.N) to make an equity investment. KKR will get a $22.5 million termination fee.

Reuters first reported on Thursday that Sirius XM was looking to invest in Pandora after their merger negotiations fell apart, citing sources.

While Sirius XM agreed to a standstill agreement for 18 months, it probably does not rule out an outright acquisition of Pandora later, analysts said.

Sirius XM’s owner Liberty Media, controls a media empire that includes big stakes in sports teams, cable and internet companies. It took full control of Sirius XM in 2013, five years after it first bought a stake. Liberty owns more than 60 percent of Sirius.

The latest investment by Sirius is convertible into Pandora common stock at $10.50 per share, a 23.8 percent premium to its Wednesday close.

Pandora also said on Friday it will sell its ticketing firm Ticketfly to Eventbrite for $200 million, less than half of the $450 million it paid last year.

Shares of Pandora were up 1.1 percent at $8.51 in afternoon trading, while Sirius was off 3.4 percent at $5.22 per share.

Sirius XM was advised by Allen Co and Bank of America, while Pandora was advised by Centerview Partners and Morgan Stanley.

(Reporting by Liana B. Baker in San Francisco and Aishwarya Venugopal in Bengaluru; Editing by Shounak Dasgupta and Jeffrey Benkoe)

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UniCredit CEO confident Italian banks will help rescue Veneto lenders

MILAN The chief executive of UniCredit (CRDI.MI), Italy’s biggest bank by assets, said on Sunday he was confident a solution for the country’s two ailing Veneto-based lenders would be found with the help of other domestic banks.

UniCredit’s boss Jean Pierre Mustier is leading talks with the Rome government and European authorities as Italy’s biggest banks mull helping Rome bail out Popolare di Vicenza and Veneto Banca to avoid being hit by costly depositor guarantees if European regulators shut them down, sources said on Thursday.

“I always see the glass half-full. I am optimistic by nature and I am in this case too,” Mustier told reporters on the sidelines of a concert in Milan when asked whether he was confident a solution for the Veneto lenders could be found with the help of other Italian banks.

(Reporting by Gianluca Semeraro, writing by Silvia Aloisi)

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Lawmakers urges U.S. Treasury to reject Aleris sale to China aluminum giant

WASHINGTON More than two dozen U.S. lawmakers have urged U.S. Treasury Secretary Steven Mnuchin to reject the proposed sale of U.S. aluminum products maker Aleris Corp (ALSD.PK) to China Zhongwang Holdings Ltd (1333.HK) to protect U.S. security interests.

In a June 9 letter to Mnuchin shared with Reuters, the 27 lawmakers said it would be a “strategic misstep” to allow the $2.33 billion sale to go ahead.

“It is critical that CFIUS (Committee on Foreign Investment in the United States) exercise extreme caution when a foreign investment transaction includes the transfer of military proficiencies and sensitive technology to China,” the lawmakers wrote.

They added: “It would be a serious strategic misstep to permit a company like Zhongwang Holdings Ltd to take control of a U.S. aluminum firm like Aleris.”

The lawmakers said Aleris was involved in the production and testing of specialized alloys used by the defense industry, and the company’s research and technology were critical to U.S. economic and national security interests.

“Chinese entities, including state-owned or state-controlled enterprises, often maintain relationships with China’s military, compounding the risk that U.S. technologies will fall into the wrong hands,” they wrote.

Additionally, Zhongwang was under investigation by the U.S. Department of Commerce for allegedly evading U.S. import duties, and was being probed by U.S. agencies over allegations of smuggling, conspiracy and wire fraud, they said.

Aleris spokesman Jason Saragian said Aleris did not make defense products in the United States.

“We believe this letter is based on misinformation,” he said. “The facts are that the completion of this transaction would result in job preservation and growth for hundreds of US Aluminum manufacturing jobs,” he said in an emailed response to the letter.

Zhongwang, backed by Chinese aluminum magnate Liu Zhongtian, announced the deal in August, in a bet by the billionaire that the nascent U.S. automotive aluminum sector will be the industry’s next big growth market.

Last November, a dozen U.S. senators wrote to then Treasury Secretary Jack Lew urging him to launch a review of the deal by the Committee on Foreign Investments by the United States.

Lawmakers who signed the new letter include House of Representative Democrats David Loebsack, Tim Ryan, Gene Green, Debbie Dingell, Seth Moulton, Marcy Kapur, Pete Aguilar, Tony Cardenas, Brenda Lawrence, Norma Torres, Linda Sanchez, and Republicans Robert Pittenger, Keith Rothfus, and French Hill.

(Reporting by Diane Bartz and Lesley Wroughton; Editing by Marguerita Choy)

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Western Digital to raise Toshiba chip offer in last-ditch bid: source

TOKYO Western Digital Corp (WDC.O) plans to raise its offer for Toshiba Corp’s (6502.T) prized semiconductor unit to $18 billion or more, a person familiar with the matter said, in a last-ditch effort to clinch a deal both companies consider vital.

The U.S. chipmaker is part of a consortium led by a Japanese government-backed fund. The group will present the new offer of 2 trillion yen or more by Thursday, when the struggling Japanese conglomerate is due to choose a preferred bidder for its Toshiba Memory Corp unit, the world’s second-largest producer of NAND memory chips, the person told Reuters on Saturday.

Toshiba has been favoring a rival bid from U.S. chipmaker Broadcom Ltd (AVGO.O), which has partnered with U.S. private equity firm Silver Lake to offer 2.2 trillion yen, people familiar with the matter have told Reuters.

A spokesman for Western Digital had no comment. Toshiba could not immediately be reached for comment.

Toshiba had set a 2 trillion yen threshold for the sale as it rushes to find a buyer to cover billions of dollars in cost overruns at its now-bankrupt U.S. nuclear business Westinghouse Electric Corp.

The offer by Western Digital, a long-time partner of the laptops-to-nuclear conglomerate’s lucrative chips division, comes as uncertainty about the make-up of the groups bidding for Toshiba’s crown jewel has increased.

Western Digital has been seen by some sources as crucial to successful deal, as it jointly operates a key flash-memory chip plant with Toshiba in western Japan.


But the two companies have been at loggerheads over the auction. Western Digital is pursuing an international arbitration claim that Toshiba has breached joint-venture contracts by entertaining outside bids.

Western Digital argues that the sale cannot proceed without its consent but the U.S. firm will drop its claim if Toshiba agrees to the new offer, the source said on Saturday.

Toshiba is concerned an acquisition by Western Digital would run into antitrust objections from China and elsewhere as the U.S. firm is the world’s third-largest NAND producer behind South Korea’s Samsung Electronics Co (005930.KS) and Toshiba.

To counter those concerns, the Western Digital portion of the consortium’s new offer will be in the form of a debt purchase whereas the U.S. firm had previously been looking for an equity stake in Toshiba Memory, the source said.

The Japan-Western Digital consortium initially offered 1.6 trillion yen, sources have said. CEO Steve Milligan then raised the offer to close to 2 trillion yen on Friday in a meeting with Toshiba CEO Satoshi Tsunakawa, the source said on Saturday.

But Toshiba expressed dissatisfaction with Friday’s bid. “Our concerns about the prospects of success for a deal were not wiped out,” a Toshiba spokeswoman said.

That set the stage for the latest offer of 2 trillion yen, or more.

In Friday’s meeting, Toshiba’s Tsunakawa asked if Western Digital “could further increase the price”, the source said, adding that the U.S. firm would modify its proposal, “to align with their thinking”.

Western Digital’s new offer will also include a commitment to $25 billion dollars in capital spending for the joint venture’s Yokkaichi facility, including building two fabrication plants, the source said.

It will also pledge $39 billion for research and development and money to boost the local economy, while expanding the workforce there by five percent a year for two years, he said.

(Additional reporting by Liana B. Baker in San Francisco and Naomi Tajitsu in Tokyo; editing by William Mallard and David Clarke)

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Regional banks may keep lagging without Washington lift

NEW YORK A rough few months for most U.S. bank stocks has been particularly unkind to regional banks, and that’s not likely to change soon as hopes dim for higher long-term interest rates and timely policy relief from Washington.

While some investors see bargains in lower valuations of regional banks’ shares, few can point with any confidence to near-term catalysts for a turnaround in their fortunes.

After outperforming larger banks in the wake of the Nov. 8 U.S. Presidential election, the SP 600 index .SPSMCBKS of small cap banks are down 8.1 percent so far this year, data through Thursday showed, while the SP 500 index of the biggest U.S. banks .SPXBK is unchanged. The full SP 500 .SPX, meanwhile, is up 8.7 percent.

Last year, investors bet heavily that smaller, entirely U.S.-focused banks would benefit most from Donald Trump’s promises of tax cuts, deregulation and economic stimulus.

But those hopes dwindled dramatically as it became clear that President Trump would have difficulty gaining enough support to deliver on any of his pro-growth proposals.

“I  would expect (smaller banks) to continue to underperform as long as we don’t get some of these policy decisions to move through,” said Stephen Scouten, banking analyst for Sandler O’Neill in Atlanta.

Fading hopes for an economic boost from Trump’s agenda has compressed the gap between short- and long-term interest rates, putting pressure on bank loan profit margins. This is a bigger issue for regionals which have a greater dependence on lending for their profits than bigger, more diversified banks.

Also, commercial and industrial loan growth has slowed this year after climbing steadily since late 2010. The Federal Reserve’s latest Senior Loan Officer Opinion Survey, released May 8, showed domestic banks reporting weaker commercial and industrial loan demand from firms of all sizes in the first quarter.


Part of the problem is that companies are waiting for clarity on economic growth prospects and tax rates before making borrowing decisions, according to investors and analysts.

“Eventually, for the smaller banks to outperform, concerns about the overall economy need to dissipate. Better economic growth usually leads to better lending growth and in that environment the yield curve steepens as well,” said Brian Kleinhanzl, analyst at Keefe, Bruyette Woods in New York.

Short selling has decreased in most regional and diversified banking sectors so far this year. But short interest in both the SPDR SP Bank Exchange Traded Fund (KBE.P) and SPDR SP Regional Banking ETF (KRE.P) increased as short sellers may be replacing exposure to individual banks with short bets on the sector.

Short interest in the SP bank ETF is up 36 percent for the year while it is up 23 percent in the regional banking ETF.

While tax cuts are viewed as one of the biggest boosts for regional banks of all Trump’s policy proposals, investors are skeptical it will come any time soon. JPMorgan analysts on Thursday scaled back their forecast on the size of possible U.S. tax cuts and pushed out the timing to the second quarter of 2018 from the third quarter of 2017.

White House economic adviser Gary Cohn has said he expects U.S. Congress to get tax reform done this year. But investors say 2018 would likely be the earliest this could happen.

Treasury Secretary Steven Mnuchin is expected this month to unveil plans for regulating the U.S. banking sector including a relaxation of regulations for community banks, which have struggled with rules imposed after the 2007 to 2009 financial crisis.

While investors expect the administration to have trouble winning congressional support for legislative changes to regulations such as Dodd-Frank, some are hoping Trump will be able to appoint people to key regulatory positions.

If Trump can replace the Federal Reserve’s head of banking supervision, this might at least help slow the pace of regulation, said investment managers.

Trump is expected to nominate Carnegie Mellon University professor Marvin Goodfriend and former Treasury Department staffer Randal Quarles to fill two of three open seats at the Fed, according to a New York Times report.

“If they do get traction and get some of these (policy changes) done, even if they’re more watered-down versions of what they had proposed, that’s probably very good for sentiment and good for the fundamentals,” said Miles Lewis, portfolio manager for American Century Investments’ Small Cap Value fund.

For a graphic on regional banks running out of steam, click

(Reporting by Sinead Carew and Megan Davies; Editing by Bill Rigby)

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Truth of Syrian Boy Breaks Interventionist Narrative

Most Americans do not know Omran Daqneesh’s name. But nearly everyone knows his face. In 2016, footage of the young Syrian boy went viral. He became the face of a mainstream media narrative urging intervention in Syria.

As I reported at The Stream last year:

There have been several spikes of gruesome, heartbreaking viral reportage on the Assad regime’s aggressive actions against jihadist cells in Aleppo. One of the first viral images was of a little boy, bloodied and covered in powder and rubble from the latest bombing. Too stunned to even cry, no parents in sight, sitting momentarily alone in an ambulance chair after busy rescue workers rushed to aid more civilian victims.

Along with the rest of the world, I was moved to tears.

But now Omran Daqneesh’s family has come forward with a story that flies in the face of that narrative. Omran’s father Mohamad Kheir Daqneesh complains his son was used for war “propaganda.” He says it was rebel “gunmen” who took Omran to the ambulance to be filmed.

What Daqneesh Says Happened

As the New York Times reported on Tuesday, Daqneesh says one of his sons was killed in Aleppo. While Daqneesh gathered his family, anti-government activists “took Omran.” Then they “got him to the ambulance, where they filmed him.”

“It was against my will,” he says.

Later, he was pressured by Syrian rebels to “talk against the Syrian regime and the State.” He was offered money. He was even intimidated by armed militants. They threatened to kidnap Omran. “They wanted to use his photo and use him. …”

The Syrian military eventually routed the rebel cells from Aleppo. Like thousands of other civilians, Daqneesh chose to live in the government-controlled city rather than move to the rebel-held Idlib province.

Publications like the New York Times Still Want War

The first half of Tuesday’s New York Times report does not inform readers. Instead, it purports to explain why Mohamad Daqneesh should not be taken seriously. Daqneesh is not quoted until the ninth paragraph.

Daqneesh is not quoted until the ninth paragraph.

The article refers to Daqneesh’s testimony as “part of a calculated public relations campaign by the Syrian government.” This claim seems disingenuous coming from a publication engaged in a calculated campaign for war.

“Syrians appearing on state television or on channels associated with the Assad government are not able to speak freely,” the article warns.

So far so good. But the report shows no such skepticism about the claims of Syrian rebel groups. The authors even admit the New York Times got Omran Daqneesh’s age wrong last year. Their faulty information came from anti-government activists in Syria.

The article weakly argues that the misreported age shows “how difficult it has been to verify the facts of his story.” What it really shows is the mainstream media’s unhesitating trust of the Syrian opposition. The New York Times simply reported their claims without verification last year.

Last year, thanks to a highly coordinated media campaign, Omran Daqneesh’s face was everywhere. That face brought the U.S. to the brink of war.

Mainstream media outlets often treat Syrian rebels as heroic underdogs. But the opposition has a history of mixing with terrorist organizations that represent an existential threat to the region.

According to a U.N. investigator, rebels even launched a sarin gas attack on civilians in an effort to frame the Assad regime in 2013.

The Stakes are High

Last year, thanks to a highly coordinated media campaign, Omran Daqneesh’s face was everywhere. That face brought the U.S. to the brink of war.

Presidential candidate Hillary Clinton threatened strikes in Syria. She planned to confront the Russian presence in Syria. Prominent Republicans agreed with her. The aggressive rhetoric moved Senator Rand Paul to warn of “World War III.”

Middle Eastern minorities have pleaded against such threats for years. U.S. support for regime-toppling rebel groups attracts Jihadists bent on destabilizing and then dominating the region.

Ultimately, this leads to genocide. Middle Eastern Christians have not forgotten the tens of thousands slaughtered or displaced by genocidal Jihad. This is what happened in the wake of American interventions against the governments of Iraq and Libya.

As Stream columnist Jason Scott Jones argues, Americans should also remember how such interventions are sold to the American public: With emotionally charged images just like the footage of Omran Daqneesh, and trumped-up stories that were only discredited long after they had served their bloody purpose.

Publications like the New York Times tell us not to trust Syrians like Mohamad Daqneesh. But with so many lives at stake, and the live options so stark, the onus is on those calling for war. Not the other way around.

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Gay Pride Month and the ‘Shot Heard Round the World’

 Quick quiz: According to statements published by the U.S. government, where was the shot fired that was “heard round the world”? Lexington and Concord, you say?

Good answer — but you’re only halfway there. There was another “shot heard round the world,” says the National Park Service. That one was in June 1969, at the Stonewall Inn in New York City, where two nights of rioting “led to the development of the modern LGBT civil rights movement.”

The Gay-Rights “Shot Heard Round the World”

You read that right. The U.S. government has co-opted Ralph Waldo Emerson’s deeply symbolic phrase to make the birth of the gay rights movement symbolically equal to the birth of our own country. To fill in the rest of the quotation:

The riots inspired LGBT people throughout the country to organize and within two years of Stonewall, LGBT rights groups had been started in nearly every major city in the U.S. Stonewall was, as historian Lillian Faderman wrote, “the shot heard round the world … crucial because it sounded the rally for the movement.”

There’s history at Stonewall, to be sure. And its reach was indeed global. The month of June is now designated “Pride Month,” and almost 150 gay pride festivals are scheduled in cities around the world. 

But what does this mean for true freedom? 

The Depth of Our National Confusion

It’s worth noting that Lillian Faderman’s full quote read, “to many homosexuals, male and female alike, the Stonewall Rebellion was the shot heard round the world” (emphasis added).

I give her credit for identifying the group who might have seen it that way. The Park Service’s version leaves that out, making it a statement for us all.

I shudder to think of how celebrations in 2017 would have turned out if Stonewall had happened a week later that year, on July 4. As far as I can tell, the White House has never been lit up in red, white, and blue. We’ve all got images seared on our brains, though, of it lit up in the six rainbow colors of the gay rights movement. 

For there is freedom, and there is freedom.

This isn’t just happening on some obscure web page, in other words. The gay rights movement has become America’s new freedom movement. It perfectly depicts the depth of our national confusion.

Freedom Based in the Image of God

For there is “freedom,” and there is freedom.

There is the freedom for which our forefathers fought at Lexington, Concord and beyond. It was a view of liberty rooted in a biblical understanding of what it means to be human.

They knew that humans are made in the image of God. We’re not just today’s snapshot in some ever-changing course of evolution. Instead human nature is a stable, enduring, real. We have a moral nature based in God’s own character. We have a well-designed sexual nature, based in God’s plan for us as individuals, couples and families who build communities and cultures together. We have a destiny based on how we relate to God in Christ and to each other in accordance with God’s design for us.

Argue all you want about whether America was founded as a Christian nation, there’s no denying that our founders’ view of human nature that was deeply influenced by the Bible’s view of humanity. Even Thomas Jefferson, who was no Christian, knew at our inalienable rights come from our Creator. Not government, not courts, not even (later on) our Constitution.

Our founders fought for freedom from political tyranny that kept them from determining their own course. Their fight was never for the “freedom” to do whatever anyone chose, though. Quite the opposite. As Benjamin Franklin said, “Only a virtuous people are capable of freedom. As nations become corrupt and vicious, they have more need of masters.” Freedom was not merely the ability to do as one wanted; it was the ability to do as one ought.

Or Freedom Based in Making Ourselves Our Own Creators

With all thought of a Creator cast aside, “freedom” now means being able to create ourselves after our own wills.

That’s the freedom for which the shots were fired at Lexington and Concord. Stonewall’s freedom has almost nothing to do with that. With all thought of a Creator cast aside, “freedom” now means being able to create ourselves after our own wills. Not satisfied with your sex? Create yourself all over again! Not content with the morality that’s held the Western world together – in spite of various wars and injustices – for centuries? Call it off! Re-make marriage while you’re at it!

And why not? The view now is that nothing about us is fixed. We’re evolving, so we can make ourselves whatever we decide to be. The same goes for human purpose and moral standards: There’s nothing there but what’s evolved over the eons, but we can alter that, too, as we will.

Our Choice: Celebrating Freedom or Free Fall

I can’t think of anything else that so clearly shows the depth of our national confusion.

We claim this as a new-found freedom. But we’re like the kite that yearned to fly high and away, free of the string it thought was holding it down. Freedom? No. Free fall.

Yet this is the freedom our own Park Service symbolically equates with Lexington and Concord. The patriotism of red, white and blue is being displaced by the spectrum of the gay rainbow.

America was never perfect. It took us way too long to recognize that human rights belong to everyone. Still we got there in law and (to an obviously lesser, yet still helpful, degree) in practice. The shots fired at Lexington and Concord led ultimately to our country becoming the world’s greatest champion for true freedom. The shot fired at Stonewall is leading us in another direction altogether.

The LGBT crowd will be celebrating their “pride” this month. That’s their choice. Our own Park Service seems to be saying everyone else is obliged to join them. I can’t think of anything else that so clearly shows the depth of our national confusion.


(I owe some of my reflections on this to a conversation this week with John Stonestreet, president of the Colson Center for Christian Worldview.)

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5 Root Causes for U.S.’s Depressed Homeownership Rate: New Study

BERKELEY, Calif., (June 9, 2017) – Despite steadily improving local job markets and historically low mortgage rates, the U.S. homeownership rate is stuck near a 50-year low because of a perverse mix of affordability challenges, student loan debt, tight credit conditions and housing supply shortages.

That’s according to findings of a new white paper titled, “Hurdles to Homeownership: Understanding the Barriers” released today in recognition of National Homeownership Month at the National Association of Realtors® Sustainable Homeownership Conference at University of California, Berkeley.

Led by a group of prominent experts, including NAR 2017 President William E. Brown, NAR Chief Economist Lawrence Yun and Berkeley Hass Real Estate Group Chair Ken Rosen, today’s conference addresses the dip and idleness in the homeownership rate, its drag on the economy and what can be done to ensure more creditworthy households have the opportunity to buy a home.

“The decline and stagnation in the homeownership rate is a trend that’s pointing in the wrong direction, and must be reversed given the many benefits of homeownership to individuals, communities and the nation’s economy,” said Brown, a Realtor® from Alamo, California. “Those who are financially capable and willing to assume the responsibilities of owning a home should have the opportunity to pursue that dream.” One of Brown’s main objectives as president of NAR is identifying ways to boost the homeownership rate in a safe and responsible way.  

The research, which was commissioned by NAR, prepared by Rosen Consulting Group, or RCG, and jointly released by the Fisher Center for Real Estate and Urban Economics at the University of California, Berkeley Haas School of Business, identifies five main barriers that have prevented a significant number of households from purchasing a home. They are:

Post-foreclosure stress disorder: There are long-lasting psychological changes in financial decision-making, including housing tenure choice, for the 9 million homeowners who experienced foreclosure, the 8.7 million people who lost their jobs, and some young adults who witnessed the hardships of their family and friends. While most Americans still have positive feelings about homeownership, targeted programs and workshops about financial literacy and mortgage debt could help return-buyers and those who may have negative biases about owning.

Mortgage availability: Credit standards have not normalized following the Great Recession. Borrowers with good-to-excellent credit scores are not getting approved at the rate they were in 2003, prior to the period of excessively lax lending standards. Safely restoring lending requirements to accessible standards is key to helping creditworthy households purchase homes.

The growing burden of student loan debt: Young households are repaying an increasing level of student loan debt that makes it extremely difficult to save for a down payment, qualify for a mortgage and afford a mortgage payment, especially in areas with high rents and home prices. As NAR found in a survey released last year, student loan debt is delaying purchases from millennials and over half expect to be delayed by at least five years. Policy changes need to be enacted that address soaring tuition costs and make repayment less burdensome.

Single-family housing affordability: Lack of inventory, higher rents and home prices, difficulty saving for a down payment and investors weighing on supply levels by scooping up single-family homes have all lead to many markets experiencing decaying affordability conditions. Unless these challenges subside, RCG forecasts that affordability will fall by an average of nearly 9 percentage points across all 75 major markets between 2016 and 2019, with approximately 5 million fewer households able to afford the local median-priced home by 2019. Declining affordability needs to be addressed with policies enacted that ensure creditworthy young households and minority groups have the opportunity to own a home.  

Single-family housing supply shortages: “Single-family home construction plummeted after the recession and is still failing to keep up with demand as cities see increased migration and population as the result of faster job growth,” said Rosen. “The insufficient level of homebuilding has created a cumulative deficit of nearly 3.7 million new homes over the last eight years.”

Fewer property lots at higher prices, difficulty finding skilled labor and higher construction costs are among the reasons cited by RCG for why housing starts are not ramping up to meet the growing demand for new supply. A concentrated effort to combat these obstacles is needed to increase building, alleviate supply shortages and preserve affordability for prospective buyers.

“Low mortgage rates and a healthy job market for college-educated adults should have translated to more home sales and upward movement in the homeownership rate in recent years,” said Yun. “Sadly, this has not been the case. Obtaining a mortgage has been tough for those with good credit, savings for a down payment are instead going towards steeper rents and student loans, and first-time buyers are finding that listings in their price range are severely inadequate.”

Added Rosen, “A healthy housing market is critical to the overall success of the U.S. economy. Too many would-be buyers have been locked out of the market by the factors found in this study, and it’s also one of the biggest reasons why economic growth has been subpar in the current recovery.”   

Today’s homeownership event in Berkeley brings together leading housing economists, policy experts, real estate practitioners and public officials to discuss current market conditions, housing policy, improving access to credit, affordable housing options and inequality.

Along with Brown, Yun and Rosen, the notable list of speakers are: Katherine Baker, California State Assembly, 16th district; Matt Regan, senior vice president of public policy, Bay Area Council; Chuck Reed, former San Jose Mayor and special counsel, Hopkins Carley; David Bank, senior vice president, Rosen Consulting Group; and Jim Gaines, chief economist, Texas AM University Real Estate Center;

Additional speakers are Joel Singer, CEO and state secretary, California Association of Realtors®; Nancy Wallace, co-chair, Fisher Center for Real Estate Urban Economics and professor, UC Berkeley Haas School of Business; Laurie Goodman, co-director, Housing Finance Policy Center, Urban Institute; Carol Galante, I. Donald Terner Distinguished Professor of Affordable Housing and Urban Policy; faculty director, Terner Center for Housing Innovation; Co-Chair of Fisher Center for Real Estate and Urban Economics; and former FHA Commissioner; John C. Weicher, director, Center for Housing and Financial Markets at the Hudson Institute, and former FHA Commissioner.

Hurdles to Homeownership: Understanding the Barriers” is the second of three papers scheduled for release in 2017 by RCG. Among the findings of the first white paper, “Homeownership in Crisis: Where Are We Now?,” released earlier this year, RCG estimated that more than $300 billion would have been added to the economy in 2016, representing a 1.8 percent bump to GDP, if homebuilding returned to a more normalized level consistent with the historical trend. The third paper – published later this year – will highlight a series of creative policy ideas to promote safe, affordable and sustainable homeownership opportunities.

View an infographic highlighting the five hurdles to buying a home.

The National Association of Realtors®, “The Voice for Real Estate,” is America’s largest trade association, representing over 1.2 million members involved in all aspects of the residential and commercial real estate industries.

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Wilbur Ross seen imposing Mexico sugar deal over industry objections

WASHINGTON U.S. Commerce Secretary Wilbur Ross is likely to impose a new sugar trade deal with Mexico even if final revisions to it fail to win support from the U.S. industry, trade lawyers and experts say.

After announcing a deal this week that would dramatically cut the amount of refined sugar that Mexico ships to the United States, officials from the two countries are working with their industries on final language that would govern its operation.

At issue is a new right of first refusal granted to Mexico to supply all U.S. sugar needs not met by domestic suppliers or other foreign quota holders.

A coalition of American sugar cane and beet farmers and a major refiner want a more explicit guarantee that the U.S. Department of Agriculture, not Mexican producers, will dictate what type of sugar fills that gap. They are worried that a flood of refined sugar will pour in, rather than the raw sugar needed to keep U.S. mills running.

The final sticking point stands in the way of resolving a years-long dispute over Mexican access to the highly regulated U.S. sugar market, which is protected by a complex web of subsidies and rationed quotas for foreign producers.

The sugar industry is known for its sway in Washington. But its point of view on Mexican imports is not shared by sugar users such as confectioners and soda makers.

The Trump administration wants to clear away the sugar dispute and a lumber trade row with Canada before starting full-scale negotiations to revise the North American Free Trade Agreement.

An industry rarely objects to a government-negotiated settlement of its anti-dumping case, and U.S. sugar producers could do little to stop the Commerce Department from implementing a final deal after a two-week comment period, said Seattle-based trade lawyer William Perry, who previously worked at Commerce and the U.S. International Trade Commission.

While the industry could ask the International Trade Commission to overturn the settlement that suspends anti-dumping and anti-subsidy duty orders issued in 2014, chances for success look slim. The panel in 2015 rejected a challenge by two sugar refiners to the previous U.S.-Mexico pact.

“Petitioners are never entirely happy with suspension agreements like this,” Perry said. “They would rather have anti-dumping and countervailing duty orders with rates high enough to shut out imports.”

A Commerce spokesman said that Ross hoped the U.S. sugar industry would ultimately endorse the final agreement.

Gary Hufbauer, a trade expert at the Peterson Institute for International Economics, said the administration was probably willing to compromise on some industry-specific concerns to help reach its larger NAFTA goals of reducing U.S. trade deficits.

The U.S. sugar industry must probably present evidence of new Mexican dumping before going back to Commerce for more changes to the deal, said Daniel Pearson, a senior fellow of the libertarian Cato Institute and former International Trade Commission chairman.

“They would do well to take this agreement and run with it and see how it works,” Pearson said, noting that it raises prices and keeps U.S. refiners well-supplied with raw sugar.

Mexico made major concessions to maintain its access to the lucrative U.S. market, agreeing to ship no less than 70 percent of its quota volume as raw sugar to U.S. refineries. It gave ground on nearly all of the U.S. producers’ demands.

American Sugar Alliance spokesman Phillip Hayes said the final hurdle should be easy to address by making clear that the USDA, not Mexico, can dictate the type and purity level of any additional imports.

But Juan Cortina, head of Mexico’s main sugar trade group, said there was no problem with the language because any additional needs would filled with raw sugar, as Mexican producers would have to keep higher inventories of that grade.

(Additional reporting by Adriana Barrera in Mexico City and Chris Prentice in New York; Editing by Lisa Von Ahn)

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Apple dips after report that future iPhone modems could lag rivals

Shares of Apple Inc (AAPL.O) fell more than 3 percent on Friday after Bloomberg News reported that iPhones launched later this year will use modem chips with slower download speeds than some rival smartphones.

Apple is widely expected to upgrade its iPhone this year, which marks the device’s 10th anniversary, and suggestions that its technology will lag the performance of high-end smartphones running Alphabet Inc’s (GOOGL.O) Android system could hurt its sales.

An Apple spokesman did not immediately respond to a request for comment.

Apple supplier Qualcomm Inc (QCOM.O) sells modems capable of downloading data at cutting-edge 1 gigabit speeds, but rival chipmaker Intel Corp’s (INTC.O) modem technology does not yet have that capability, according to the Bloomberg report.

Since Apple is traditionally reluctant to rely on just one supplier, it is using modems from both companies, but capping download speeds of the quicker Qualcomm modems so that all of the new iPhones perform the same, Bloomberg reported, citing unnamed sources.

Shares of the Cupertino, California company have surged 29 percent so far in 2017, largely in anticipation of the iPhone upgrade. The stock on Friday declined 3.5 percent to $149.60.

(Reporting by Noel Randewich; Editing by Bill Rigby)

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Tech stocks tumble, backing Wall Street away from highs

Technology stocks sold off on Friday, wounding the Nasdaq and holding down other major Wall Street indexes, which had touched record highs earlier in the session.

The technology sector .SPLRCT, which has soared this year and led the market’s rally, dropped 3.6 percent.

Apple (AAPL.O) shares fell 4.8 percent and were the biggest weight on the three major indexes, after a report that upcoming iPhones launched will use modem chips with slower download speeds than some rival smartphones.

Microsoft (MSFT.O), Facebook (FB.O) and Alphabet (GOOGL.O) all were off more than 3 percent, while chipmaker Nvidia (NVDA.O) traded down 8.8 percent at $147.60 after Citron Research said the stock could trade back to $130.

Shares of software company Cloudera (CLDR.N) tumbled 16.7 percent after its earnings report.

“Tech has been on a tear for a very, very long period of time,” said John Praveen, managing director for Prudential International Investments Advisers in Newark, New Jersey, adding that investors may be using the earnings report as “an excuse to take some profits.”

The Dow Jones Industrial Average .DJI fell 17.02 points, or 0.08 percent, to 21,165.51, the SP 500 .SPX lost 15.88 points, or 0.65 percent, to 2,417.91 and the Nasdaq Composite .IXIC dropped 166.89 points, or 2.64 percent, to 6,154.87.

Countering tech’s slide, financials .SPSY rose 1.4 percent and energy shares .SPNY gained 2.3 percent as oil prices moved higher.

Investors were also digesting major political and economic events this week in the United States and Europe.

U.S. stocks had started the session strong after the results of the UK election, where British Prime Minister Theresa May’s Conservative Party lost its parliamentary majority.

Investors also viewed former FBI Director James Comey’s testimony on Thursday as not damaging enough to Donald Trump’s presidency.

Market watchers were concerned result of the Congressional hearing could derail Trump’s plans for lower taxes, fiscal spending and looser regulations, which have helped drive the SP 500 up more than 13 percent since his election.

Focus was turning to the Federal Reserve’s meeting next week, when the U.S. central bank is overwhelmingly expected to raise interest rates.

“Markets are probably expecting that the Fed will raise rates, but they will be very gradual in removing monetary accommodation,” Praveen said.

Advancing issues outnumbered declining ones on the NYSE by a 1.50-to-1 ratio; on Nasdaq, a 1.01-to-1 ratio favored advancers.

(Additiona reporting by Tanya Agrawal and Yashaswini Swamynathan in Bengaluru; Editing by Nick Zieminski)

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Jobless claims drop; labor market slack shrinking

WASHINGTON The number of Americans filing for unemployment benefits fell last week, unwinding half of the prior period’s jump and suggesting the labor market was tightening despite a recent slowdown in job growth.

Initial claims for state unemployment benefits declined 10,000 to a seasonally adjusted 245,000 for the week ended June 3, the Labor Department said on Thursday. The report followed data on Tuesday showing job openings at a record high in April.

“There is no sign of a pickup in the rate of layoffs. Against this backdrop of high job openings, firms appear to be holding on to their workers,” said John Ryding, chief economist at RDQ Economics in New York.

Claims surged by 20,000 in the prior week, with California, Tennessee, Kansas, and Missouri accounting for the bulk of the increase. Some of that increase was related to school summer breaks in which bus drivers and cafeteria workers were left temporarily unemployed.

Claims have now been below 300,000, a threshold associated with a healthy labor market, for 118 straight weeks. That is the longest such stretch since 1970, when the labor market was smaller. The labor market is near full employment, with the jobless rate at a 16-year low of 4.3 percent.

Economists polled by Reuters had forecast first-time applications for jobless benefits falling to 240,000 in the latest week. The four-week moving average of claims, considered a better measure of labor market trends as it irons out week-to-week volatility, increased 2,250 to 242,000 last week.

The dollar rose against the euro after the European Central Bank kept interest rates on hold but cut its forecasts for inflation and said policymakers had not discussed scaling back the central bank’s massive bond-buying program. Prices for U.S. Treasuries fell, while stocks on Wall Street were slightly higher.


Low layoffs and record high job openings suggest a deceleration in job growth in May was likely because companies could not find suitable workers. The economy created 138,000 jobs in May, well below the average monthly 181,000 jobs gained over the prior 12 months.

The Labor Department reported on Tuesday that job openings, a measure of labor demand, increased by 259,000 to a seasonally adjusted 6.0 million in April, the highest level since the government started tracking the series in 2000.

“Labor market supply constraints are expected to bite into job creation but should also help to keep a lid on jobless claims as employers focus on retaining talent, so long as the economy continues to chug along,” said Jim Baird, chief investment officer at Plante Moran Financial Advisors in Kalamazoo, Michigan.

Economists believe that labor market tightness could encourage the Federal Reserve to raise interest rates at its June 13-14 policy meeting. The U.S. central bank lifted its benchmark overnight interest rate by 25 basis points in March.

“The Fed will continue to view the labor market data as signalizing that the economy remains at or near full employment,” said Michael Gapen, chief economist at Barclays in New York.

Thursday’s claims report also showed the number of people still receiving benefits after an initial week of aid fell 2,000 to 1.92 million in the week ended May 27. The so-called continuing claims now have been below 2 million for eight straight weeks, pointing to diminishing labor market slack.

The four-week moving average of continuing claims slipped 750 to 1.91 million, the lowest level since January 1974.

(Reporting by Lucia Mutikani; Editing by Paul Simao)

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Verizon plans to cut 2,000 jobs at Yahoo, AOL: source

Verizon Communications Inc (VZ.N) is expected to cut about 2,000 jobs when it completes its $4.48 billion acquisition of Yahoo Inc’s (YHOO.O) core assets next week, a person briefed on the matter said.

The cuts are expected to come from Verizon’s AOL and Yahoo units and represent about 15 percent of the staff at the two units. About 14,000 people work at AOL and Yahoo.

Many of the jobs are in California and some are outside the United States, according to the source, who asked not to be identified because the matter is not yet public.

Yahoo shareholders on Thursday approved the company’s sale, according to preliminary results from a shareholder meeting, and it is expected to be completed on Tuesday.

The No. 1 U.S. wireless operator is combining Yahoo’s search, email and messenger assets as well as advertising technology tools with its AOL unit, which it bought in 2015 for $4.4 billion. Verizon expects mobile video and advertising to be new sources of revenue outside the oversaturated wireless market.

Verizon shares are down 15 percent this year.

The acquisition marks the end of the line for Yahoo as a standalone company, a storied Web pioneer once valued at more than $100 billion.

Verizon is rebranding AOL and Yahoo as part of a new venture called Oath, led by AOL Chief Executive Officer Tim Armstrong.

Verizon is betting it can use data from more than 200 million unique monthly visitors to Yahoo sites and combine it with data on 150 million unique monthly AOL users and its own user base of over 100 million wireless subscribers to offer more targeted services for advertisers.

The Yahoo deal came after activist investors led by Starboard Value LP lost faith in Yahoo Chief Executive Officer Marissa Mayer, who was hired in 2012, and forced the sale of the company’s core assets. Mayer is not expected to remain at Yahoo after the sale is completed.

Yahoo is still one of the largest properties on the internet, with hundreds of millions of customers using its email, finance and sports offerings, and a heavily trafficked home page. In February 2016, Yahoo announced it was cutting 1,600 employees, or 15 percent of its staff.

The deal’s closing was delayed as the companies assessed the fallout from two Yahoo data breaches.

Yahoo disclosed in December that data from more than 1 billion user accounts was compromised in August 2013, making it the largest breach in history. This followed a separate disclosure that at least 500 million accounts were affected in a 2014 breach.

(Editing by Tom Brown and Bernadette Baum)

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‘Trump trade’ comeback not enough to boost Wall Street

NEW YORK The ‘Trump trade’ made a comeback on Thursday on Wall Street but major indexes were in and out of negative territory as former FBI director James Comey said President Donald Trump fired him to undermine an investigation into Russian meddling into last November’s U.S. election.

Traders had been on tenterhooks ahead of Comey’s testimony to a Senate committee, his first since being fired by Trump on May 9. His prepared remarks had been made public Wednesday.

The market’s concern on the issue is whether the Trump administration can put the investigation behind it and revive momentum for their agenda of lower taxes and looser regulations. Bets on that agenda are partly behind a rally that has taken stock indexes to record highs.

The Trump ‘reflation trade’ that favored banks and sectors linked to infrastructure spending, among others, was back Thursday, with the SP 500 financial sector .SPSY up 1.2 percent.

The SP 1500 construction and engineering index .SPCOMCSE rose 1.5 percent and a gauge of construction materials’ stocks .SPCOMCEMT added 1.4 percent.

“If there was something (damning) that’s going to come out, as leaky as things seem to be, we would have heard something more than what we’ve been hearing so far,” said Scott Wren, senior global equity strategist at Wells Fargo Investment Institute in St. Louis, Missouri.

Also supporting infrastructure stocks, specifically steel companies, was an announcement from Commerce Secretary Wilbur Ross that a national security review of the U.S. steel industry will seek to protect the interests of both domestic steel producers and consumers.

In his statement, Comey said the president lied in describing their encounters and that he had no doubt that Russia interfered with the election, but was confident that no votes had been altered.

The Dow Jones Industrial Average .DJI fell 19.19 points, or 0.09 percent, to 21,154.5, the SP 500 .SPX lost 2.87 points, or 0.12 percent, to 2,430.27 and the Nasdaq Composite .IXIC added 11.27 points, or 0.18 percent, to 6,308.65.

Other analysts were not so rosy about the effect on Comey’s testimony on the Trump agenda.

“It leaves us where we were before. It becomes that much more difficult for the Trump administration to put together a fiscal stimulus package,” said John Canavan, market strategist at Stone McCarthy Research Associates in Princeton, New Jersey.

“Anything they could put together with tax reform and infrastructure spending would be a lot smaller than had been expected. You are also pushing back the timing on any fiscal stimulus into 2018, possibly in 2019.”

Utilities stocks fell the most on the SP 500 as Treasury yields rose, tracking German Bund yields, after European Central Bank upgraded its growth forecast for the euro zone even as it suggested its stimulus plan will remain in place as inflation remains subdued.

The SP utilities sector .SPLRCU was down 1.3 percent, the most for any day since early March.

Traders kept an eye on the UK as Britons voted in a snap election predicted to give Prime Minister Theresa May a larger parliamentary majority, which she hopes will strengthen her hand in looming divorce talks with the European Union.

Among specific stocks, Nordstrom (JWN.N) jumped 8.6 percent to $43.95 after the department store operator said that some members of the controlling Nordstrom family have formed a group to consider taking the company private.

Alibaba shares (BABA.N) were up 12.9 percent to $141.82 after the company said it expects revenue growth of 45-49 percent in the 2018 fiscal year.

The largest percentage gainer on the SP 500 was Yahoo (YHOO.O), which rose 9.7 percent, while the largest decliner was Advance Auto Parts (AAP.N), down 3.4 percent.

Advancing issues outnumbered declining ones on the NYSE by a 1.22-to-1 ratio; on Nasdaq, a 1.96-to-1 ratio favored advancers.

(Reporting by Rodrigo Campos, additional reporting by Richard Leong and Caroline Valetkevitch; Editing by Chizu Nomiyama)

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If Wonder Woman Can Get the Job Done Pregnant, So Can You

This image released by Warner Bros. Entertainment shows Gal Gadot in a scene from Wonder Woman.


Published on June 8, 2017

The new superhero movie Wonder Woman is blowing away expectations and crashing through glass ceilings with an opening weekend that brought in $100 million domestically — a record for a movie directed by a woman.

But here’s another fun fact that shows you can proudly be pro-mom and pro-career woman: Israeli actress Gal Gadot was five months pregnant with her second child when she did re-shoot scenes for the movie that included a climactic battle scene.

To get around her then-visible baby bump, costumers cut an ample triangle on her iconic suit and replaced it with a bright green cloth that allowed the movie’s special effects team to change her figure post-production.

Given the prevailing negative news that shows women facing all sorts of career challenges by wanting to have a baby, it’s refreshing to see a successful woman embrace her pregnancy and still do an exceptional job.

Because by five months (especially with your second child), your belly is likely extended to support a baby that is about the size of a banana from head to rump. From sore muscles to headaches and heartburn, it is understandable that pregnant women might not feel like superheroes, but their contribution to America’s future is crucial.

According to Mollie Ziegler Hemingway in The Heritage Foundation’s 2016 Index of Culture and Opportunity, America’s fertility rate — the average number of children a woman has over her lifetime — has been on the decline for the past decade.

In addition to posing risks to the general economy, a declining fertility rate poses risks to our military, entitlement state, and even the growth and vitality of houses of worship and community health centers.

With many millennial women delaying marriage and even having children, it is important they see successful peers not letting careers stop them from taking on one of the toughest jobs out there — the job of physically bearing a child and rearing it.


Copyright 2017 The Daily Signal

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Bernie Sanders Just Applied a Religious Test to a Christian Nominee for Public Office

The U.S. Constitution prohibits the use of a “religious test” for any office or public trust. But Bernie Sanders got very close to doing just on Wednesday. It was during the confirmation hearing for President Trump’s nominee for deputy director of the Office of Management and Budget. 

During Russell Vought’s confirmation hearing, Sanders took issue with an article Vought wrote for conservative website The Resurgent in January 2016, reported The Atlantic. In his article, Vought defended a Christian school that had fired a professor for expressing solidarity with Muslims. Sanders objected to Vought’s statement in the article: “Muslims do not simply have a deficient theology. They do not know God because they have rejected Jesus Christ his Son, and they stand condemned.”

Sanders objected. “In my view, the statement made by Mr. Vought is indefensible, it is hateful, it is Islamophobic, and it is an insult to over a billion Muslims throughout the world,” Sanders told the committee at the hearing. “This country, since its inception, has struggled, sometimes with great pain, to overcome discrimination of all forms … we must not go backwards.”

Later Sanders asked Vought, “Do you believe that statement is Islamophobic?” “Absolutely not, Senator,” said Vought. “I’m a Christian, and I believe in a Christian set of principles based on my faith.”

Sanders continued to berate and interrupt Vought. “I don’t know how many Muslims there are in America, I really don’t know, probably a couple million. Are you suggesting that all of those people stand condemned? What about Jews? Do they stand condemned too?” Vought replied that he was a Christian, but Sanders quickly cut him off. “I understand you are a Christian. But this country is made up of people who are not just — I understand that Christianity is the majority religion. But there are other people who have different religions in this country and around the world. In your judgment, do you think that people who are not Christians are going to be condemned?”

Vought tried to explain the concept of imago dei to Sanders. “As a Christian, I believe that all individuals are made in the image of God and are worthy of dignity and respect, regardless of their religious beliefs. I believe that as a Christian that’s how I should treat all individuals … .” Sanders cut him off again and asked Vought if his comments were respectful of other religions. Vought reminded Sanders that the article he wrote was as a Christian about a Christian university, which “has a statement of faith that speaks clearly with regard to the centrality of Jesus Christ in salvation.”

In response, Sanders told the committee: “I would simply say, Mr. Chairman, that this nominee is really not someone who is what this country is supposed to be about. I will vote no.”

Russell Moore, president of the Ethics Religious Liberty Commission of the Southern Baptist Convention responded to Sanders’ religious test in the hearing.

Senator Sanders’ comments are breathtakingly audacious and shockingly ignorant — both of the Constitution and of basic Christian doctrine. Even if one were to excuse Senator Sanders for not realizing that all Christians of every age have insisted that faith in Jesus Christ is the only pathway to salvation, it is inconceivable that Senator Sanders would cite religious beliefs as disqualifying an individual for public office in defiance of the United States Constitution. No religious test shall ever be required of those seeking public office. While no one expects Senator Sanders to be a theologian, we should expect far more from an elected official who has taken an oath to support and defend the Constitution.

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Exclusive: Toshiba aims to name buyer of $18 billion chips business on June 15

TOKYO/SAN FRANCISCO Toshiba Corp (6502.T) aims to name a winner for its prized semiconductor business next week, people familiar with the matter said on Wednesday, as a row with one of the bidders over the sale appeared to escalate.

Sources told Reuters the choice has narrowed to one bid from U.S. chipmaker Broadcom Ltd (AVGO.O) and U.S. tech fund Silver Lake and another from Toshiba chip partner Western Digital Corp (WDC.O) and Japanese government-related investors.

Toshiba is rushing to find a buyer for the world’s second-largest producer of NAND chips, which it values at $18 billion or more, to cover billions of dollars in cost overruns at its now-bankrupt U.S. nuclear business Westinghouse Electric Corp.

The laptops-to-nuclear giant will hold a board meeting on June 15 to decide on the preferred bidder, two sources said.

Western Digital, which jointly operates Toshiba’s main chip plant in Yokkaichi, western Japan, has complicated the sale effort with a legal challenge, accusing Toshiba of a serious breach of contract over the joint venture.

It argues that the unit cannot be sold without its consent and has demanded exclusive negotiating rights.

But in a letter seen by Reuters, Toshiba struck back, again asking Western Digital to stop challenging the plans.

“Toshiba encourages Western Digital to redirect the considerable efforts that it has put into disrupting Toshiba’s sale process into more productive channels.”

Toshiba and Western Digital did not immediately respond to requests for comment.

The Broadcom-Silver Lake bid is attractive because of its higher price of 2.2 trillion yen ($20 billion), sources have said.

This compares with an offer of less than 2 trillion yen from Western Digital, which could also face antitrust hurdles because the firm is the third-largest maker of NAND flash-memory chips.

“Naturally, for the Toshiba corporate side, Broadcom is the best choice,” one source said. .

Other bidders include U.S. private-equity firm Bain Capital with South Korean chipmaker SK Hynix Inc (000660.KS), and Taiwan’s Hon Hai Precision Industry Co Ltd (2317.TW) with its Japanese unit Sharp Corp.

(Additional reporting by Taro Fuse in TOKYO; editing by William Mallard/Alexander Smith)

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Abu Dhabi port eases restrictions on oil tankers going to and from Qatar

SINGAPORE/DUBAI Abu Dhabi port authorities have eased restrictions on oil tankers going to and from Qatar, according to industry sources and shipping circulars seen by Reuters on Wednesday.

Abu Dhabi Petroleum Ports Authority issued a new circular on Wednesday removing previous restrictions on non-Qatar owned, flagged or operated vessels sailing to and from Qatar.

This effectively allows direct trade between the two ports and co-loading of crude cargoes, a Singapore-based shipbroker said.

A Middle East-based industry source said there had been no official notification on halting the co-loading of crude cargoes.

The ban on vessels carrying the Qatari flag and vessels owned or operated by Qatar is still in place, according to the circular.

But given there are few Qatari-flagged or owned vessels, this is unlikely to have as big an impact on the market as the previous circular, the shipbroker added.

Reuters reported on Wednesday two very large crude carriers (VLCCs), which can each carry up to 2 million barrels of oil, loaded Abu Dhabi grades on Wednesday, despite having taken Qatari crude in an earlier leg of the voyage.

On Monday, Saudi Arabia’s Ports Authority told shipping agents not to accept vessels flying the Qatari flag or ships owned by Qatari companies or individuals, it said on its Twitter account, adding that Qatari goods would be barred from unloading in Saudi ports.

On Wednesday, Saudi’s Ras Tanura oil port issued a notice stressing the restrictions issued earlier by the Saudi Ports Authority, according to a copy seen by Reuters.

Another industry source said the notice indicated co-loading of crude cargoes at Saudi ports would be allowed.

On Monday, Saudi Arabia, Egypt, the United Arab Emirates and Bahrain severed ties including all air, land and sea transport links with Qatar, accusing it of supporting terrorism. Doha denies the accusation.

(Reporting by Jessica Jaganathan, Roslan Khasawneh in Singapore, Rania El Gamal in Dubai and Reem Shamseddine in Khobar; Editing by Dale Hudson)

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Wall St. slips as oil weighs; Thursday’s events awaited

U.S. stocks slipped in early afternoon trading on Wednesday, weighed down by a fall in oil prices, while caution reigned ahead of Thursday’s major political and economic events.

Oil prices fell more than 4 percent due to an unexpected rise in U.S. crude inventories and took a toll on the energy sector .SPNY, which dropped 2.1 percent. [O/R]

Exxon’s (XOM.N) 0.7 percent fall and Chevron’s (CVX.N) 1.3 percent fall were among the biggest drags on the SP 500 and the Dow.

Investors are also keeping a watch on Britain’s general election, the European Central Bank’s policy meeting and former FBI Director James Comey’s testimony before a Senate panel on Thursday.

Opinion polls have shown British Prime Minister Theresa May’s lead over the opposition Labor party narrow over the last three weeks, with some even suggesting she could fall short of a majority government.

The election could determine whether the country has a smooth or hard exit from the European Union.

“If the Conservative party extends its majority, markets will be pretty calm, but anything less than that is going to have people worried about how we approach the Brexit negotiation,” said Luke Hickmore, senior investment manager at Aberdeen Asset Management.

Comey’s first public appearance since he was fired by U.S. President Donald Trump might shed more light on a probe by the FBI into alleged Russian meddling in last year’s U.S. presidential election.

Any damaging revelation in Comey’s testimony could dampen already flagging momentum for Trump’s pro-business fiscal agenda.

“I think the Comey news led to an initial surprise but the rebound was equally swift,” said Liz Ann Sonders, chief investment strategist at Charles Schwab Co.

“I’m not sure that unless Comey says something completely shocking or he suggests something that there’s no way the House can’t consider obstruction of justice … aside from that I don’t see his testimony as market moving.”

The ECB will also hold its policy meeting on Thursday and is expected to reiterate its plan to extend the money-printing scheme at least until the end of the year.

At 12:53 p.m. (1653 GMT), the Dow Jones Industrial Average .DJI was down 13.5 points, or 0.06 percent, at 21,122.73 and the SP 500 .SPX was down 3.46 points, or 0.14 percent, at 2,425.87. The Nasdaq Composite .IXIC was down 5.79 points, or 0.09 percent, at 6,269.27.

Seven of the 11 major SP 500 sectors were higher, with the financial index’s .SPSY 0.78 percent rise leading the advancers.

Shares of Navistar International (NAV.N) were down 4.2 percent at $28.68 after the truck and engine maker posted a quarterly loss.

Declining issues outnumbered advancers on the NYSE by 1,526 to 1,283. On the Nasdaq, 1,444 issues rose and 1,343 fell.

(Reporting by Tanya Agrawal in Bengaluru; Editing by Anil D’Silva)

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