Morning News: July 6, 2021
Posted by Eddy Elfenbein on July 6th, 2021 at 7:07 am

OPEC+ Crisis Propels Oil to Six-Year High

Is This the End of OPEC? How Saudi Arabia and UAE Infighting Threatens the Future of the Oil Alliance

Global Corporate Tax Overhaul Faces Rocky Road to Completion

Empathy Bootcamp? UK Banks Seek Payback on $105 Billion COVID Loans

When Will China Overtake the U.S. as the World’s Top Economy? Maybe Never

Quickening U.S. Recovery Puts Fed Taper Discussion in Focus

The Next Big Divide in Finance Takes Shape in Your Office

American Internet Giants Hit Back at Hong Kong Doxxing Law

China’s Crackdown on Didi Is a Reminder That Beijing Is in Charge

Big Ransomware Hack Highlights a Robust Software Business Model

No Soil. No Growing Seasons. Just Add Water and Technology.

Here’s What You Should Know About That Eye-Popping Sign-On Bonus

Airbnb’s Pandemic Party-Blocking Spree Rages On

SoftBank Pays $1.6 Billion for Yahoo Japan Rights

Amazon Transformed Seattle. Now, Its Workers Are Poised to Take It Back.

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Italy’s Ali Group Raises Offer for Welbilt to $3.41 Billion, Trumping Middleby Bid
Posted by Eddy Elfenbein on July 5th, 2021 at 11:45 pm

From Reuters:

Italy’s Ali Group on Monday said it raised its offer to buy Welbilt Inc, valuing the U.S. food service equipment maker at $3.41 billion.

The deal trumps a $2.9 billion all-stock offer for Welbilt put forward by competitor Middleby in April to beef up its commercial foodservice platform.

Welbilt will receive $24 for each share, representing a premium of 3.53% to the closing price on Friday.

The offer is a raised bid from its previous $23 per share offer in May.

Ali Group said that it has obtained fully underwritten, binding commitment letters for debt financing from Goldman Sachs International and Mediobanca.

Based near Milan, Ali Group, with 80 brands, operates worldwide and supplies foodservice equipment to businesses ranging from hotels to schools and supermarkets.

Morning News: July 5, 2021
Posted by Eddy Elfenbein on July 5th, 2021 at 7:09 am

OPEC+ Crisis Deepens as Saudi Arabia Refuses to Budge

Credit Suisse Strategist Sees $1 Trillion Problem for Money Markets

Why Is China Cracking Down on Didi After U.S. IPO?

Chinese Antitrust Regulator to Block Tencent’s Videogaming Merger

The Tech Cold War’s ‘Most Complicated Machine’ That’s Out of China’s Reach

Britain Proposes Tech Company Listing Reforms to Catch Up with New York

Stocks Are Expensive but that Doesn’t Mean the Bull Run is Ending

Hacking Wall Street

Pandemic Wave of Automation May Be Bad News for Workers

Investigating Amazon, the Employer

‘Absolutely a Sprint’: How Andy Jassy Raced to the Top of Amazon

After Pressuring Telecom Firms, Myanmar’s Junta Bans Executives from Leaving

The Charges Against the Trump Organization Are a Master Class in Tax Evasion

The US is a First-World Nation With a Third-World Rail System

Sun Valley’s Billionaire ‘Summer Camp’ Is Back After A Virus-Induced Break

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June Jobs Report
Posted by Eddy Elfenbein on July 2nd, 2021 at 8:33 am

The jobs report is out. Last month, the U.S. economy created 850,000 new jobs. The consensus was for 706,000.

The private sector added 762,000 jobs. The unemployment ticked up to 5.9%.

Average hourly earnings rose 0.3%. In the last year, average hourly earnings are up 3.6%.

Underemployment is 9.8% and the labor force participation rate was 61.6%. The latter figure has barely budged.

Hospitality continued to be the prime beneficiary of the reopening as workers returned to jobs at bars, restaurants, hotels and the like.

The industry notched a gain of 340,000 amid easing restrictions across the country. That total included 194,000 in bars and restaurants, but still left the sector 2.2 million shy of where it was in February 2020 before the pandemic began.

Other notable gains came in education, which totaled 269,000 across state, local and private hiring, while professional and business services increased by 72,000 and retail added 67,000.

The other services industry added 56,000 jobs, including a gain of 29,000 in personal and laundry services, a subsector that has been seen as a proxy for the resumption of normal business activity. Social assistance added 32,000, while wholesale trade contributed 21,000 to the total and mining grew by 10,000.

Manufacturing edged up 15,000 for the month, though construction lost 7,000 positions despite a sizzling housing industry where new building has been held back by supply shortages and what had been soaring lumber prices before the recent plunge.

Here’s the updated chart of nonfarm payrolls.

We’ve created a lot of jobs but we still have a long way to go.

Morning News: July 2, 2021
Posted by Eddy Elfenbein on July 2nd, 2021 at 7:01 am

Oil Holds Near $75 as Brinkmanship at OPEC+ Threatens Deal

U.S. Proposal for 15% Global Minimum Tax Wins Support From 130 Countries

Budget Deficit Projected to Hit $3 Trillion as Pandemic Spending Buoys Economy

Halfway Through 2021, the Hot Stocks Are Old-Fashioned

World’s Top Pension Fund Books ‘Historic’ $339 Billion Gain

China and Hong Kong Stocks Tumble After ‘Broken Heads and Bloodshed’ Speech from Xi

U.S. Toymaker Doubles Down in China Despite Rising Costs, Political Tensions

Didi Opens Door for More Tech IPOs Beyond China. Where Emerging Market Investors Should Look.

Dogecoin Whale? Robinhood IPO Filing Reveals Dogecoin as One of its Biggest Risk Factors

Rumors of the Demise of Cars Have Been Greatly Exaggerated

‘Shocked’ Mitsubishi Electric CEO to Quit Over Data Deceit

New Saudi Airline Plan Takes Aim at Emirates, Qatar Airways

The FTC Just Took a Step That Could Make It Easier to Go After Amazon

Amazon Revises Corporate Values Days Before Bezos Steps Down

Bezos’ Exit Is One of Many Among Amazon’s Top Ranks

Jeff Bezos Is Headed To Space. Richard Branson Decided To Beat Him There

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Jobless Claims Drop to 364,000
Posted by Eddy Elfenbein on July 1st, 2021 at 1:44 pm

I like the initial jobless claims report, but it tends to be “noisy.” It can bounce around a lot. Two weeks ago, it rose from 374,000 to 418,000. Then last week, it edged down to 415,000. Today’s report was 364,000. That’s another pandemic low.

This morning’s ISM Manufacturing report came in at 60.6. That was just below expectations of 61. That’s the lowest since January. That’s still a solid number. Any number above 50 means the factory sector is expanding.

The expectation for tomorrow’s jobs report is that the unemployment rate fell to 5.6% and that the U.S. economy created 704,000 net new jobs. The report is due out tomorrow morning.

Morning News: July 1, 2021
Posted by Eddy Elfenbein on July 1st, 2021 at 7:04 am

European Factories Racing As Asian Manufacturers See Momentum Weaken

Ghosts of Crises Past Haunt Policymakers and Markets

A Housing Frenzy Is Sparking Bidding Wars From New York to Shenzhen

Averting Inflation Crisis Turns on Something Fed Doesn’t Control

Amazon Says the New F.T.C. Chair, Lina Khan, Should Recuse Herself from Investigations

Biden’s Big Business Crackdown Bad for Wall Street Behemoths

An NFT of the World Wide Web Sells for $5.4 Million

At Monterey Car Week, the Sheet Metal Shines

Car Market Is Expected to Cool Amid Dearth of Vehicles on Lots

Nissan Bets on UK ‘Renaissance’ With Battery Plant and New Vehicle

Lockheed Wins $5.5 Billion Swiss Warplane Deal

Robbing the Xbox Vault: Inside a $10 Million Gift Card Cheat

Robinhood Is Fined $70 Million Over Misleading Customers and System Outages

Robinhood Looks Beyond Its Big Fine

Shortage of Truck Drivers is Behind Fuel Delivery Delays, Says GasBuddy Analyst

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ADP Jobs Report = 692,000
Posted by Eddy Elfenbein on June 30th, 2021 at 12:28 pm

This morning we got the ADP private payroll report. According to ADP, the U.S. economy created 692,000 private sector jobs last month. That’s a big number. Wall Street had been expecting 600,000.

From an industry standpoint, the biggest hiring gain came from the 332,000 pickup in leisure and hospitality. The sector, which includes bars, restaurants, hotels and other related businesses, took the hardest hit from the Covid-19 pandemic but has shown strong gains during the economic reopening.

Education and health services also indicated strong gains, increasing by 123,000, while trade, transportation and utilities rose by 62,000 and professional and business services saw 53,000 hires.

On the goods-producing side, construction payrolls increased by 47,000 while manufacturing was up 19,000.

Overall, services provided the bulk of the job gains with 624,000, while goods producers added 68,000.

The official jobs report from the government is due out on Friday. I should caution you that the ADP report is not always a good predictor of what the government report will say. The consensus is for the government report to say that 675,000 jobs were created in June.

Here’s a chart with the ADP data in red and the government in black:

Tomorrow we’ll get the ISM Manufacturing report along with the jobless claims report.

Bloomberg on Danaher
Posted by Eddy Elfenbein on June 30th, 2021 at 11:42 am

As many of you know, I’m a big fan of Danaher. The company is quiet and prefers to stay out of the limelight. At Bloomberg, Devon Pendleton and Tom Maloney discuss the Rales brothers’ charitable donations.

Steven and Mitchell formed Danaher in the early 1980s, converting a real estate investment trust into a shell for scooping up struggling, little-known manufacturing businesses.

They were among the first in North America to adopt the Japanese management philosophy of kaizen, which emphasizes efficiency and continuous improvement.

That’s led to a shift in focus to life sciences, illustrated by Danaher’s acquisition last year of the biopharma unit of General Electric Co., whose chief executive officer, Larry Culp, previously headed Danaher for 14 years.

The kaizen-inspired operating system has been credited for the company’s consistent returns. Its stock has outperformed Warren Buffett’s Berkshire Hathaway Inc. by almost 7% over the past 30 years.

Along with efficiency, another of the brothers’ hallmarks is a reliance on credit. The Rales built up Danaher through a slew of debt-financed takeovers, leading Forbes to dub them “raiders in short pants” in a 1985 profile.

Morning News: June 30, 2021
Posted by Eddy Elfenbein on June 30th, 2021 at 7:07 am

Global Regulators Try Again to Eliminate Money-Market Hazards

Treasury Yields Signal Investors’ Waning Economic Exuberance

Fed Unity Cracks as Inflation Rises and Officials Debate Future

Congress Faces Renewed Pressure to ‘Modernize Our Antitrust Laws’

CFPB Beefs Up Protections for Struggling Homeowners, But Will Not Ban Foreclosures

Solar Stocks Rally To Two-Month High As Restriction Fears Ease

Why Cathie Wood’s Ark Invest is Launching a Bitcoin ETF

China’s Didi Raises $4.4 Billion in Upsized U.S. IPO

Deutsche Bank’s License to Sponsor Hong Kong IPOs Suspended

Husband-and-Wife Team Worth $2.2 Billion After Bubble Tea IPO

Tech Company 2U Will Pay $800 Million to Buy EdX, Online Education Platform MIT and Harvard Created

Facebook Unveils ‘Bulletin,’ A Newsletter Subscription Service

Berkshire’s Munger Says China Right to Clip Ma’s Wings

Americans Lost $29.8 Billion to Phone Scams over Past Year, Tripled from 2019

The Fall of the Billionaire Gucci Master

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