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Aviation
Trade truce
Transatlantic relations are getting a boost with the U.S. and EU on the cusp of a deal to resolve a 17-year dispute over aircraft subsidies. The breakthrough, set to be finalized today during President Biden's first European meeting in Brussels, would lift the threat of billions of dollars in punitive tariffs via a multiyear accord on subsidy limits. It would also remove a sizable shadow that's been hanging over the planemaking industry, as well as threats that other consumer goods could be targeted with retaliatory levies.
Backdrop: The dispute is one of the longest-running battles at the World Trade Organization. It started in 2004 when the U.S. withdrew from a 1992 aircraft subsidy pact, alleging that Airbus (OTCPK:EADSF) had managed to equal Boeing's (NYSE:BA) share of the jet market due to subsidized government loans, while the EU counter-sued over unfair R&D support and subsidized tax incentives. The case wound through the WTO over the years, but in 2019, it awarded partial victories to both planemakers. While they attempted to work things out over the coming years, billions of dollars in tariffs were progressively imposed by each side, until the two suspended the duties in March 2021, setting a four-month deadline to work out a deal.
The current standstill agreement would likely include a five-year suspension of tariffs and remove claims for compensation. The U.S. would also withdraw a demand that would see it get advanced notice of any future public loans to Airbus. Another critical detail is the benchmark to be used when determining whether the interest on a future loan is market compatible.
Competition is rising: The arrangement would arrive as President Biden pledges to reset relations with European partners, while taking a hard-line stance on China. Beijing has its own ambitions to become a global player in commercial aircraft and even plans on delivering its C919 to its first client at the end of 2021. "There's no question that the rise of China's aircraft industry is... on everybody's proverbial radar," U.S. Chamber of Commerce Senior Vice-President Marjorie Chorlins told reporters on Monday, noting the country's "heavy subsidization" of its industries and threats posed by its state-driven economic model.
Statistic: Job openings soared to a record 9.3M in April as the economy reopened, according to the latest JOLTS report, but 3.5M Americans are still on weekly jobless benefits and more than 9M remain unemployed.
Go figure... While the numbers sound somewhat contradictory due to the ways they are collected and measured, they mean the U.S. is experiencing high unemployment at the same time as a labor shortage. While there are many reasons for the hiring scarcity like shifting employment choices, Republicans have mainly pointed to programs such as enhanced unemployment benefits, while Democrats have flagged items like childcare responsibilities, lingering COVID-19 worries and the need to raise wages.
"Look, this is the biggest economic challenge of our time," U.S. Chamber of Commerce CEO Suzanne Clark declared. "I went to Rehoboth [Delaware] over the weekend, took my teenager to the beach. And the number of restaurants, the number of small businesses that have restricted their hours, that aren't serving lunch, or aren't open at all because of the workforce shortage is tragic."
Making moves: As a result, Clark is launching an initiative to address the worker shortage called "Operation Warp Speed for Jobs." It will advocate for "federal and state policy changes that will help train more Americans for in-demand jobs, remove barriers to work, and double the number of visas available for legal immigrants." The U.S. Chamber Foundation is also expanding its "most impactful employer-led workforce and job training programs and launching new efforts to connect employers to undiscovered talent."
Kitco Gold Index.
US Mint Bullion sales rose 360% in May.
FED walks tightrope between big jobs gap and Rising Inflation.
The problem they have is complicated, by also not wanting to raise interest rates, and having to step in, heavily supporting Bond purchases.
Trapped by their own policy.
Rebess I agree.
It shows just how important it is to maintain confidence in the US $ as World Reserve Currency.
The need to divert attention from inflation threats, it is a battle to the end for the US FED and Banking institutions.
They may even partially succeed .
Whether it is intended manipulation or not ,one can only guess.
Commodities: - Base metals getting slaughtered today. - Agricultural yesterday. - It seems like the levers of manipulation are everywhere. - As inflation becomes a problem, we're gonna see a lot more of it I feel in attempting to control price-inflation. - Once again highlighting just how much control there is in supposedly free-markets. - Scary or what? - So, it's not just Gold. - It's everything!