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Apr 9, 2019

NFA | News and Notices | NFA orders Ryan Litfin, former associated person and branch manager of the Eden Prairie, Minn. Branch office of East West Global, LLC to not reapply for NFA membership for five years

For Immediate Release
April 09, 2019

For more information contact:Kristen Scaletta, 312-781-7860, kscaletta@nfa.futures.org
Karen Wuertz, 312-781-1335, kwuertz@nfa.futures.org

April 9, Chicago—NFA has ordered Ryan Litfin, former associated person and branch manager of the Eden Prairie, Minn. Branch office of East West Global, LLC to not reapply for NFA membership for five years.
The Decision, issued by an NFA Hearing Panel, is based on a Complaint issued by NFA's Business Conduct Committee (BCC), and a settlement offer submitted by Litfin. The Complaint charged Litfin with making deceptive and misleading sales solicitations to pool participants and failing to uphold high standards of commercial honor and just and equitable principles of trade by utilizing materially inaccurate and deficient disclosure documents. NFA's Complaint alleged that Litfin employed a strategy that relied on extremely high fees that generated significant revenue for East West Global, at the expense of the firm's pool participants, and failed to adequately disclose the high fees and poor overall performance of the pools. The Complaint also alleged that Litfin knew these disclosure documents were materially inaccurate and likely to deceive pool participants.
Litfin, has been the subject of a three previous Complaints issued by NFA's BCC. In 2012, Litfin was charged with making misleading sales solicitations, using misleading promotional material, and failing to supervise. In 2013, Litfin was charged with failing to supervise and using promotional material prior to submitting it to NFA for pre-review and approval. In 2016, Litfin was charged with using deficient promotional material, failing to submit promotional material to NFA for pre-review and approval, and failing to supervise.

The complete text of the 2018 Complaint and 2019 Decision can be viewed on on NFA's website.

Source: NFA


News & Notices | From NFA

2-3 minutes



For Immediate Release
April 09, 2019
For more information contact:
Kristen Scaletta, 312-781-7860, kscaletta@nfa.futures.org
Karen Wuertz, 312-781-1335, kwuertz@nfa.futures.org
NFA orders Highland Park, Ill. commodity pool operator East West Global, LLC and its principal Luke James Adrian to jointly pay a $75,000 fine
April 9, Chicago—NFA has ordered Highland Park, Ill. commodity pool operator East West Global, LLC and its principal and associated person Luke James Adrian to jointly pay a $75,000 fine.
The Decision, issued by an NFA Hearing Panel, is based on a Complaint issued by NFA's Business Conduct Committee, and a settlement offer submitted by East West Global and Adrian. The Hearing Panel found that East West Global made deceptive and misleading sales solicitations to pool participants and failed to uphold high standards of commercial honor and just and equitable principles of trade by utilizing materially inaccurate and deficient disclosure documents. NFA's Complaint alleged that East West Global and Adrian employed a strategy that relied on extremely high fees that generated significant revenue for East West Global, at the expense of the firm's pool participants, and failed to adequately disclose the high fees and poor overall performance of the pools. The Complaint also alleged that East West Global and Adrian knew these disclosure documents were materially inaccurate and likely to deceive pool participants. In addition, the Hearing Panel found that East West Global and Adrian failed to adequately supervise the firm's operations and employees.
The complete text of the Complaint and Decision can be viewed on NFA's website.

Source: NFA

FX | Currencies Report on Tuesday, April 9, 2019 | Yen gains on US-Europe trade tension, weaker IMF forecasts

David Reid




RT: 100 dollar bills cash dollars 180508
Antara Foto | Hafidz Mubarak via Reuters
The yen rose on Tuesday as traders favored the safe-haven currency after the United States announced it was considering tariffs on $11 billion of European goods and the International Monetary Fund downgraded its outlook on the global economy.
These factors weighed on market sentiment, spurring selling on Wall Street and touching off a partial reversal of earlier gains in oil prices. The pull back in crude and other commodity prices cut into the initial gains of the Canadian and Australian dollar as well as emerging currencies.
“Yen is now the top dog with lower stocks weighing on risk appetite,” said Joe Manimbo, senior market analyst at Western Union Business Solutions in Washington.
At 3:20 p.m., the yen was 0.31% higher at 111.12 per dollar and up 0.22% per euro.
Major U.S. stock indexes were lower with the S&P 500 index down 0.55%. Brent oil futures were 0.72% lower at $70.59 a barrel after hitting $71.34 earlier on Tuesday, the highest since November.
On Monday, the U.S. Trade Representative proposed a list of European Union products ranging from large commercial aircraft and parts to dairy products and wine on which to slap tariffs as retaliation for European aircraft subsidies.
The IMF on Tuesday cut its global growth forecasts for 2019 to 3.3%, the slowest expansion since 2016 and from its earlier projection of 3.5% in January.
While the IMF reduced its calls on expansion for both Europe and the United States, the euro held its modest gains versus the dollar, last up 0.15% at $1.1276.
“Lots of negativity is already baked into the euro. Today’s developments, while not encouraging, didn’t meaningfully add to the bloc’s weak narrative,” Manimbo said.
The latest IMF forecasts, together with the retreat in oil prices, put pressure on the Australian and Canadian dollars. Both countries are big commodities producers.
The Aussie was flat at $0.7125 after touching a near three-week high, while the loonie was little changed at C$1.332 after hitting C$1.3285, its strongest since March 21.
Meanwhile, sterling was down 0.08% at $1.3052 after a German government spokesman denied a media report that Chancellor Angela Merkel was open to put a time limit on the Northern Ireland backstop in a Brexit agreement.

Source: CNBC




Bond Yields Report on Tuesday , April 9, 2019 | Treasury yields edge lower as investors turn cautious over earnings, tariffs

Matt Clinch



U.S. Markets Overview: Treasurys chart

TICKER COMPANY YIELD CHANGE %CHANGE
US 3-MOU.S. 3 Month Treasury2.4290.000.00
US 1-YRU.S. 1 Year Treasury2.423-0.0060.00
US 2-YRU.S. 2 Year Treasury2.348-0.010.00
US 5-YRU.S. 5 Year Treasury2.307-0.0190.00
US 10-YRU.S. 10 Year Treasury2.499-0.020.00
US 30-YRU.S. 30 Year Treasury2.909-0.0150.00
U.S. government debt yields fell on Tuesday, pulling back from the slim gains seen in the previous session.
The yield on the benchmark 10-year Treasury note, which moves inversely to price, was lower at around 2.496 percent, while the yield on the 30-year Treasury bond was also lower at 2.9071 percent.
Investors are grappling with the intensified trade tensions between the U.S. and the European Union after a World Trade Organization ruling over subsidies for Airbus. The WTO ruled last year that the subsidies caused “adverse effects to the U.S.” U.S. Trade Representative Robert Lighthizer on Monday proposed a list of European Union products on which to slap tariffs as retaliation for European aircraft subsidies.
Treasury yields ticked higher on Monday after the U.S. government said new orders for domestic goods fell in February, suggesting a softening in the manufacturing sector. Concerns about U.S. earnings have dragged on equities in recent sessions, pushing investors toward fixed-income assets. J.P. Morgan Chase & Co and Wells Fargo are both poised to report their latest figures on Friday.
First-quarter earnings season kicks off this week with J.P. Morgan Chase on Friday.
Federal Reserve Vice Chair Randal Quarles will speak at the George Mason University “Meet the Policymakers” Forum and Vice Chairman Richard Clarida is speaking at the Minneapolis Fed’s Opportunity & Inclusive Growth Institute Spring Conference.
Meanwhile, oil prices scaled new 2019 highs on Monday, with the international benchmark Brent crude futures contract adding 1.1 percent to settle at $71.10 per barrel. U.S. crude futures also rose 2.1 percent to settle at $64.40 per barrel.
The U.S. Treasury auctioned $38 billion in three-year notes on Tuesday.
—CNBC’s Yun Li, Sam Meredith and Spriha Srivastava contributed to this article.

Source: CNBC

Wall Street Closing Report on Tuesday April 9, 2019 | Dow falls a second day, loses more than 180 points with investors nervous about earnings

Thomas Franck



The Dow Jones Industrial Average fell for a second straight day Tuesday as investors awaited the start of corporate earnings season later this week.
The Dow lost 200 points as Boeing stock came under pressure again on concerns about 737 Max jet production delays. The S&P 500 fell 0.6%, led by losses in industrials, energy and financial companies. The Nasdaq Composite dropped 0.5% as Microsoft, Apple, Amazon and Alphabet all declined.
Market focus is centered on corporate earnings results, with major U.S. banks set to kick off the first-quarter earnings season later in the week. J.P. Morgan Chase and Wells Fargo are both poised to report their latest figures on Friday, while Citigroup and BlackRock are scheduled to publish their results next week.
Bank of America, which will also report earnings next week, said Tuesday that it’s raising its minimum wage for its employees to $20 an hour. The minimum wage at the company will be raised to $17 effective May 1 and will increase in increments over the next two years.
Bank of America, Goldman Sachs, J.P. Morgan and Morgan Stanley all fell at least 0.5%.
Earnings Season
Wall Street expectations for this earnings season imply a significant reduction to corporate profit growth in comparison to recent quarters.
Investors anticipate first-quarter S&P 500 earnings growth to slip 4.3% on a year-over-year basis, according to FactSet estimates. S&P 500 revenues are expected to grow just under 5%.
“We’re heading into earnings seasons and growth is expected to be negative for the first time since 2016. I think investors are wringing their hands over it,” said Jack Ablin, chief investment officer at Cresset Wealth Advisors. “But, if you look at all the credit spreads, you look at volatility, everything still suggests that investors just tighten their seatbelts.”
“That said,” Ablin added, “it appears we’ve had a year’s worth of gains in the first three months so I can’t blame anyone for wanting to take chips off the table.”
Traders work on the floor of the New York Stock Exchange on March 22, 2019.
Spencer Platt | Getty Images
American aircraft giant Boeing dropped 1.5% Tuesday as investor angst over its decision on Friday to cut production of its 737 Max jets kept pressure on the stock. Regulators and stakeholders alike are scrutinizing the company in light of two recent fatal 737 Max crashes.
Wall Street short seller Carson Block believes the crashes show that the company is more concerned with short-term profits than anything else.
The prolonged grounding of the 737 Max planes forced American Airlines on Tuesday to lower its revenues guidance for the first fiscal quarter. The airline cut its total expected revenue per seat mile, a key industry measure of performance, to a range of flat to 1%, down from a prior estimate of flat to 2%.
Though American Airlines stock fell 1.1% Tuesday, selling in major industrials names wasn’t confined to the aerospace industry.
EU trade talk
Trade tensions between the U.S. and the European Union intensified Tuesday following a World Trade Organization ruling over subsidies for Airbus. The WTO ruled last year that the subsidies caused “adverse effects to the U.S.,” prompting Washington to consider $11 billion worth of retaliatory tariffs on a range of European goods.
But Brussels on Tuesday responded to the prospective U.S. levies by saying it’s ready to respond in kind.
“The EU is confident that the level of countermeasures on which the notice is based is greatly exaggerated. The amount of WTO authorized retaliation can only be determined by the WTO-appointed arbitrator,” a European Commission spokesman said.
Shares of Caterpillar fell 1.8% while Deere dropped 3.1%.
Disney, meanwhile, rose 1.4% Tuesday after brokerage Cowen upgraded the Dow component and told clients that its film pipeline should boost profits over the next few years.
“We view Disney’s catalyst path for the next year as highly attractive, and believe Thursday’s investor day will likely be a deck-clearing event for sentiment,” wrote Cowen analyst Doug Creutz.
—CNBC’s Sam Meredith, Spriha Srivastava and Eustance Huang contributed to this story.

Source: CNBC

Crude Oil Price Report on Tuesday, April 9, 2019 | Oil slips from 5-month highs as Russia casts doubt on further output cuts

Tom DiChristopher



RT: Offshore oil rig Norway 160211
An offshore oil rig off the coast of Norway.
Nerijus Adomaitis | Reuters
Oil fell from a five-month high above $71 a barrel on Tuesday as Russian comments signaling the possible easing of a supply-cutting deal with OPEC countered concern that violence in Libya could further tighten global markets.
A U.S. threat to slap tariffs on hundreds of European goods and a downgrade by the International Monetary Fund in its global economic growth forecasts took the steam out of the rally in global equities and also added to concerns that a slowdown this year will hit fuel consumption and prevent crude prices from rising even higher.
Supply curbs led by OPEC and allies like Russia have underpinned a more than 30 percent rally this year for Brent crude, despite downward pressure from fears of an economic slowdown.
Brent, the global benchmark, rose to $71.34 a barrel, the highest since November, before falling 37 cents to $70.73 around 1:35 p.m. ET (1735 GMT).
U.S. crude also hit a high going back to November 2018 at $64.79, but was last down 28 cents at $64.11.
“Russia already signaled its willingness to raise oil output from June,” said Norbert Ruecker of Swiss bank Julius Baer. “Fuel remains costly in emerging markets, with soft currencies adding to high oil prices.”
Russia, a participant in the OPEC-led supply cuts that currently expire in June, signaled on Monday it wanted to raise output when it meets with OPEC because of falling stockpiles.
On Tuesday, President Vladimir Putin said Russia did not support an uncontrollable rise in oil prices and that the current price suited Moscow.
Russian Energy Minister Alexander Novak said there would be no need to extend the supply-curbing deal if the market was expected to be balanced in the second half of the year.
U.S. sanctions on Iran and Venezuela have deepened the OPEC supply cut and concern has grown this week about the stability of Libyan output. The OPEC member pumps around 1.1 million barrels per day, just over 1 percent of global supply.
The eastern Libyan National Army forces of Khalifa Haftar - a former general in ousted strongman Muammar Gaddafi’s army - which seized the sparsely populated but oil-rich south earlier this year, closed in on the internationally recognized government in Tripoli, with casualties from the battle for Libya’s capital mounting on Tuesday.
The Libyan state oil firm NOC met with oil operating firms to discuss security at oil fields and allow production to continue, a company statement said on Tuesday.
“The oil market is already undersupplied, so if supply from Libya also falls away the supply deficit will become even bigger,” said Carsten Fritsch, oil analyst at Commerzbank.
Rising U.S. crude production and inventories also weighed on the market.
U.S. crude production was expected to rise 1.43 million bpd in 2019 to average 12.49 million bpd, the U.S. Energy Information Administration said on Tuesday, up from its previous forecast for a rise of 1.35 million bpd.
U.S. crude stockpiles were forecast to have risen 2.3 million barrels last week, the third straight weekly build.
The American Petroleum Institute, an industry group, issues its supply report at 4:30 p.m. ET (2030 GMT), ahead of Wednesday’s official figures from the Department of Energy.
“I think what’s really giving the market pause is that nobody can actually come close to predicting what’s going to happen in tonight’s API report,” Phil Flynn, analyst at Price Futures Group in Chicago.

Source: CNBC






























Metals Price Report on Tuesday, April 9, 2019 | Gold hits more than one-week high as dollar, stocks retreat


Sam Meredith



RT: Gold Bullions 170616
Gold rose to its highest in more than a week on Tuesday as the dollar and equities weakened after the International Monetary Fund cut its global economic growth forecasts for the year, with increased buying by central banks lending further support.
Spot gold was up 0.6 percent at $1,304.41 per ounce, having hit its highest since March 28 at $1,306.09. U.S. gold futures were up 0.6 percent at $1,309.20.
“The main reason is the fact that the IMF downgraded global economic growth from 3.5 down to 3.3 percent; that coupled with news over the weekend that China was upping their gold stockpiles has gold trading higher at the moment,” said Bob Haberkorn, senior market strategist at RJO Futures.
“It’s (IMF forecast) got little jitters out there in the markets, some flight to safety buying just based of that. We’ll see a move back to $1,325 over the next two weeks or so.”
The IMF on Tuesday cut its global growth forecasts for 2019 and warned growth could slow further due to trade tensions and a potentially disorderly British exit from the European Union.
China, the world’s biggest gold consumer, raised its gold reserves for a fourth straight month in March, when Turkey also increased holdings.
The dollar index fell to its lowest in more than a week, while Wall Street’s main indexes opened lower on trade concerns.
Data on Tuesday showed the U.S. job openings fell to 7.087 million in February, piling on to lacklustre data including a modest dip in new orders for U.S.-made goods, and last week’s non-farm payrolls data, which signalled a slowdown in wage growth.
“With some questionable data here in the U.S. and abroad, there would be a stronger need for safe haven assets and gold would certainly lead that charge,” said David Meger, director of metals trading at High Ridge Futures.
“In the short term, we believe gold is continuing its slow grind sideways to higher.”
Investors are now awaiting minutes of the U.S. Federal Reserve’s March meeting on Wednesday.
The upward momentum in bullion was yet to reflect on the investment side, with holdings of the world’s largest gold-backed exchange-traded fund, SPDR Gold Trust, falling for a sixth straight session on Monday.
Among other precious metals, spot platinum slipped 0.2 percent to $903.20 per ounce, after touching its highest since the end of May last year in the previous session.
Palladium was up 0.5 percent at $1,390.62 an ounce, while silver gained 0.2 percent at $15.27.

Source: CNBC


























News Release From FDIC | U.S., European Banking Union, and UK Officials Meet for Planned Coordination Exercise on Cross-Border Resolution Planning

FOR IMMEDIATE RELEASE

April 9, 2019
WASHINGTON — Senior officials representing resolution, regulatory and supervisory authorities, central banks, and finance ministries in the United States, the United Kingdom, and the European Banking Union will hold a meeting on Saturday, April 13, as part of a series of planned exercises to enhance understanding of one another's resolution regimes for global systemically important banks and strengthen coordination on cross-border resolution.
This meeting builds upon two prior exercises in 2014 and 2016. The exercise is planned to coincide with the annual international meetings in Washington sponsored by the World Bank and International Monetary Fund.
The Federal Deposit Insurance Corporation will host the exercise. Other senior officials from the United States are expected from the U.S. Department of the Treasury, the Board of Governors of the Federal Reserve System, the Office of the Comptroller of the Currency, the Securities and Exchange Commission, the Commodity Futures Trading Commission, and the Federal Reserve Bank of New York.
Expected participants from the European Banking Union include senior officials from the Single Resolution Board, the European Commission, and the European Central Bank. Expected participants from the United Kingdom include senior officials from HM Treasury, the Bank of England, and the Prudential Regulation Authority.
# # #
Congress created the Federal Deposit Insurance Corporation in 1933 to restore public confidence in the nation's banking system. The FDIC insures deposits at the nation's banks and savings associations, 5,406 as of December 31, 2018. It promotes the safety and soundness of these institutions by identifying, monitoring and addressing risks to which they are exposed. The FDIC receives no federal tax dollars—insured financial institutions fund its operations.
FDIC press releases and other information are available on the Internet at www.fdic.gov, by subscription electronically (go to www.fdic.gov/about/subscriptions/index.html) and may also be obtained through the FDIC's Public Information Center (877-275-3342 or 703-562-2200). PR-33-2019

Source: FDIC

Europe Markets Closing Report on Tuesday, April 9, 2018 | European stocks close lower amid US tariff threat

Sam Meredith , David Reid



European stocks fell Tuesday on the back of a fresh tariff threat from the United States government.

European Markets: FTSE, GDAXI, FCHI, IBEX

TICKER COMPANY NAME PRICE CHANGE %CHANGE VOLUME
FTSEFTSE 100FTSE7429.20-22.69-0.30474243996
DAXDAXDAX11877.14-86.26-0.7243386304
CACCACCAC5449.67-22.11-0.4040999518
The pan-European Euro Stoxx 600 index closed provisionally 0.35% lower, with most sectors and bourses in negative territory. It comes after U.S. Trade Representative Robert Lighthizer on Monday proposed a list of European Union products on which to slap tariffs as retaliation for European aircraft subsidies, with Airbus down nearly 2%.
The U.S. is considering tariffs on about $11 billion of EU products ranging from aircraft parts to wine. The move comes as the President Donald Trump administration looks to retaliate against EU subsidies for Airbus, which the World Trade Organization ruled had “adverse effects” on America.
Other European-listed stocks such as Rolls-Royce, Thales, Dassault Systemes, BAE and Leonardo were seen as among the most exposed to Lighthizer’s threat and these firms fell lower Tuesday afternoon.
Drink maker stocks also went on a wild ride with Remy Cointreau, Pernod Ricard and Davide Campari all suffering losses. Other items on the U.S. list included some European-produced cheese, passenger helicopters, as well as certain types of motorcycles and ski suits.
The announcement comes shortly after a World Trade Organization ruling said the U.S. was guilty of illegal subsidies in production of Boeing aircraft.
Market focus is also attuned to corporate results, with major U.S. banks set to get the ball rolling later in the week. J.P. Morgan Chase & Co and Wells Fargo are both poised to report their latest figures on Friday.
Concerns about U.S. earnings have dragged on global equities in recent sessions, though a robust jobs report last week helped to soothe frayed nerves.
Breaking from the overall negative sentiment, Alcon, which was spun off from drugmaker Novartis Tuesday, surged 41 percent following its debut on the SIX Swiss Exchange. Novartis, on the other hand, dropped 2 percent.
Brexit drama
Back in Europe, investors continue to monitor an upcoming Brexit summit. U.K. Prime Minister Theresa May is expected to meet with the leaders of Germany and France later in the session, with four days to go before the world’s fifth-largest economy is due to leave the European Union.
May will be at an emergency summit on Wednesday, when all 28 EU states will vote on whether to grant the U.K. an additional Brexit extension.
Elsewhere, Commerzbank is reportedly set to decide whether or not to continue merger talks with Deutsche Bank on Tuesday.

Source: CNBC

Latest News From the IMF | IMF Executive Board Completes Third Review Under Argentina's Stand-By Arrangement, Approves US$10.8 Billion Disbursement

4-5 minutes



April 5, 2019
The Executive Board of the International Monetary Fund (IMF) completed today the third review of Argentina’s economic performance under the 36-month Stand-By Arrangement (SBA) that was approved on June 20, 2018. The completion of the review allows the authorities to draw the equivalent of SDR 7.8 billion (about US$10.8 billion), bringing total purchases since June 2018 to SDR 28.01371 billion (about US$38.9 billion).
Following the Executive Board discussion of Argentina’s economic plan, Ms. Christine Lagarde, the IMF’s Managing Director stated:
“The authorities’ policies that underly the Fund-supported arrangement are bearing fruit. The high fiscal and current account deficits - two major vulnerabilities that led to the financial crisis last year - are falling. Economic activity contracted in 2018 but there are signs that the recession has bottomed out, and a gradual recovery is expected to take hold in the coming quarters. Inflation however remains high with inflation expectations rising and inflation inertia proving difficult to break.
“The Argentine government demonstrated its resolve to put the public debt-to-GDP ratio on a sustainable path by reducing the 2018 primary deficit below the program target. However, in light of weaker-than expected tax revenues in the first half of the year, continued prudence in the execution of spending plans and further steps to strengthen revenues, will be key to bring the 2019 fiscal position to a primary balance. Further effort is needed to improve the medium-term fiscal framework and debt management.
“After a few months of relative stability, financial volatility has picked up in recent weeks, as global financial conditions have become less favorable and as inflation outcomes have disappointed. The BCRA reacted to these developments by recalibrating its monetary policy, maintaining zero growth in the monetary base until the end of the year. A new central bank charter has been sent to Congress and, if passed into law, will strengthen the credibility of monetary policy.
“Protecting the most vulnerable from the impact of the recession and from high inflation remains a key priority. The authorities have taken a series of actions to improve the coverage of the social safety net and to provide greater resources to the poor. Continued work will be needed to address the remaining gaps in coverage of the social safety net and to make social programs more effective in reducing poverty.
“Favorable market conditions have allowed the government to fully rollover maturing debt over the past few months. The interest rate paid on that debt has fallen and the authorities are deepening their efforts to extend maturities on newly-issued debt. The authorities are also implementing policies to develop domestic currency debt markets.
“Supply-side reforms are essential in achieving strong, sustainable, and equitable growth and to raise living standards for Argentina’s population. Priorities include further efforts to designing a less distortionary tax system, encouraging greater competition in domestic product markets, removing barriers to trade and foreign investment, strengthening governance and confronting corruption, and fostering gender equity.
“The success of the authorities’ policy plans relies on its continued steadfast implementation. This will require the building of broad-based support for policies that will lessen economic vulnerabilities, raise Argentina’s growth potential, and foster market confidence.”
IMF Communications Department
MEDIA RELATIONS
PRESS OFFICER: Maria Candia Romano
Phone: +1 202 623-7100Email: MEDIA@IMF.org

Analysis | The Technology 202: Lawmakers plan to ratchet up pressure on tech companies' content moderation practices

By Cat Zakrzewski Cat Zakrzewski Technology policy reporter.



PowerPost Analysis
Analysis Interpretation of the news based on evidence, including data, as well as anticipating how events might unfold based on past events

Ctrl + N


House Judiciary Committee Chairman Jerry Nadler (D-NY) walks to his office at the US Capitol in Washington, DC. (Photo by Mandel NGAN / AFP)
U.S. lawmakers have not been as aggressive as some of their peers in other countries in holding tech companies accountable for harmful content on their platforms. But at a pair of hearings on the Hill this week, they're expected to ratchet up their scrutiny of Silicon Valley's content moderation practices.  
House Judiciary Committee chairman Jerrold Nadler tells my colleague Tony Romm that today's hearing on the proliferation of white nationalism on Facebook and Google's platforms is just a “first stage” — he wants to press the companies to take action first before considering new regulations. 
“Let's see what happens by just pressuring them first,” the New York Democrat said. “I'm reluctant to have regulation of speech. It usually goes too far. I don't know we have to get there yet.”
On the other side of the Capitol, Republicans plan to ramp up criticism of companies' content moderation practices this week — for very different reasons. At a Senate Judiciary Committee tomorrow on allegations of anti-conservative bias, expect Republicans repeat claims that Facebook, Google and Twitter are too focused on taking down content online that results in conservative voices and news being suppressed. While there's so far no evidence of systemic bias against conservative content, the drumbeat of criticism could still increase the prospect of regulation — a threat that President Trump himself has repeatedly made.
The hearings showcase two different manifestations of the forthcoming debate in Washington over how to rein in Big Tech — and the challenge for the companies. Tech companies are under increasing pressure to show how they will keep people safe — while still preserving free speech. And in a such a politicized environment in Washington, they must also show they are committed to fair treatment of all political parties. 
Given how complex these challenges are, it likely means that for the foreseeable future technology companies will be forced to navigate a patchwork of different rules across the globe governing when they need to take down content. 
The challenge on removing hate speech is only growing as recent incidents like the New Zealand shootings or the Pittsburgh synagogue massacre last year put a spotlight on the ways technology platforms can be exploited to amplify violent and hateful messages online.
Yet Nadler resisted the idea of gutting the tech industry's prized federal legal shield, which gives the companies broad legal immunity for the content posted on their platforms. The technology industry has fiercely defended Section 230 of the Communications Decency Act, even though some critics think its time for the law to be overhauled to address the proliferation of violence and hate speech online today. 
“No, that would be a revolution in how social media works,” he said.
“It says to me that there's a felt need, there's a feeling abroad as well as here that social media has been used for bad purposes, has been used to promote racist or hateful doctrines and hate speech,” Nadler said.
Australia recently passed a law that could result in jail time for executives at companies that leave violent content online. In the United Kingdom, lawmakers unveiled a broad blueprint for how they could fine companies for failing to takedown a broad range of harmful speech, from violent content to disinformation. As the U.K. and Australia become some of the first countries to consider such regulations, their actions could influence how policymakers around the world broach content moderation issues.
“If we can put in place a system of regulation that is sensible,” U.K. digital minister Jeremy Wright told Tony in a recent interview. “We won’t be the only country to want to do that.”
Other Democrats on the committee seemed open to considering regulations to address problematic content on the platforms. Rep. Karen Bass (D-Calif.) told Tony regulations should be examined. Rep. Cedric L. Richmond (D-La.) told him that regulation may be necessary to govern how companies address harmful content. He said technology companies should play a role in shaping what that regulation should look like and pitch a proposal. “They better go do it because what they don't want is for us to do it, because we're not going to get it right,” Richmond said. “We're going to make it swift, we're going to make it strong and we're going to hold them very accountable.”
You are reading The Technology 202, our guide to the intersection of technology and politics.
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BITS, NIBBLES AND BYTES

Sen. Marsha Blackburn (R-TN) participates in a mock swearing in with U.S. Vice President Mike Pence during the opening day of the 116th Congress on Capitol Hill in Washington, U.S. January 3, 2019. REUTERS/Aaron P. Bernstein
BITS: A bipartisan duo called on the Federal Trade Commission to “take action” against Facebook and Google over potential data security and competition violations, The Hill's Emily Birnbaum reports. Sens. Amy Klobuchar (D-Minn.) and Marsha Blackburn (R-Tenn.) asked the agency in a letter if it were investigating Google, and they called on the FTC to provide the public with more details about its investigations into internet companies.
“We understand that the FTC does not typically comment on nonpublic investigations, but the public discussion surrounding Google and other companies’ conduct have made this a uniquely important national issue,” the senators, who both have worked on tech policy issues, wrote in the letter.
“Accordingly, we respectfully request that the FTC consider publicly disclosing whether it is conducting an investigation of Google and/or other major online platforms and describe, in general terms, the nature of the conduct under examination in any such investigations,” they also wrote.
Rep. David N. Cicilline (D-R.I.) previously has called for the FTC to investigate Facebook for antitrust violations. The agency is already considering levying a multibillion dollar fine against Facebook as it investigates the company for potential privacy violations following the Cambridge Analytica scandal.

An anti-Brexit campaigner shows her support for Europe waving a European Union flag outside Parliament in London. (AP Photo/Kirsty Wigglesworth, File)
NIBBLES: The European Union on Tuesday unveiled a new set of guidelines to steer the way companies and governments ethically develop artificial intelligence, according to The Verge's James Vincent. The principles call for accountable, explainable and unbiased AI systems.
“They don’t offer a snappy, moral framework that will help us control murderous robots,” Vincent wrote. “Instead, they address the murky and diffuse problems that will affect society as we integrate AI into sectors like health care, education, and consumer technology.”
The principles state that AI “should not trample on human autonomy.” They also say AI should be secure and accurate. The recommendations call for data related to AI systems to be stored securely. They also say AI systems should be available to all and should not be biased along the lines of gender, race or other characteristics.

Microsoft CEO Satya Nadella speaks during the annual Microsoft Corp. shareholders meeting in Bellevue, Wash. (AP Photo/Ted S. Warren, File)
BYTES: The European Union's data commissioner is investigating the European Commission and other E.U. institutions' software deals with Microsoft to ensure they comply with the region's sweeping data privacy rules, according to Reuters' Francesco Guarascio and Foo Yun Chee. 
The investigation opened Monday underscores how the E.U. General Data Protection Rules, which went into effect last year, are holding companies to a higher bar when it comes to data privacy.
“The probe will look into the Microsoft products and services used by the institutions and whether the contractual agreements between them and the U.S. software company are GDPR-compliant,” Reuters reported.
Microsoft told Reuters it was working with the E.U. data authority on the investigation.
“When relying on third parties to provide services, the E.U. institutions remain accountable for any data processing carried out on their behalf,” Assistant EDPS Wojciech Wiewiorowski said, per the Reuters report. “They also have a duty to ensure that any contractual arrangements respect the new rules and to identify and mitigate any risks,” he said.
PRIVATE CLOUD
— Technology news from the private sector:

Unlike at social networks such as Facebook and Twitter, the people who respond to reports of harassment are largely unpaid volunteers.
New York Times

Facebook is gearing up for upcoming elections in India.
CNET

Twitter just took another big step to help boot spammers off its platform: it’s cutting the number of accounts Twitter users can follow, from 1,000 per day to just 400.
TechCrunch

“Individuals and organizations who spread hate, attack, or call for the exclusion of others on the basis of who they are have no place on Facebook,” a Facebook spokesperson said.
Buzzfeed News

Twitter CEO Jack Dorsey received a total salary of $1.40 in 2018, the social media company said Monday.
The Hill
PUBLIC CLOUD
— Technology news from the public sector:

Warner and Fischer contend that the data gathered through these practices gives the biggest tech companies a major advantage over their smaller competitors
Axios

White House aides would recommend President Donald Trump veto a bill to restore landmark net neutrality protections if reinstated by Congress, according to a document sent to lawmakers Monday and seen by Reuters.
Reuters

Colorado Gov. Jared Polis (D) is expected to sign net neutrality legislation that bans internet service providers from getting taxpayer money in Colorado if they slow down internet access or unfairly speed up certain websites.
The Hill
#TRENDING
— Tech news generating buzz around the Web:

Our tech columnist answers your questions about how to block spam, nuisance and fraudulent calls on your home phone.
Geoffrey A. Fowler

Class accounts are a way for incoming freshmen to make friends, find roommates, and suss out colleges before fall.
The Atlantic

It's official: Google launches its world-first drone delivery business in Canberra's north.

Source: The Washington Post

Business News | Trump slams EU in aircraft dispute, pushes tariffs on $11 billion...

Reuters Editorial



FILE PHOTO: U.S. President Donald Trump speaks during a meeting of the White House Opportunity and Revitalization Council in the Cabinet room at the White House in Washington, U.S., April 4, 2019. REUTERS/Kevin Lamarque/File PhotoWASHINGTON (Reuters) - U.S. President Donald Trump said on Tuesday the United States would impose tariffs on $11 billion of products from the European Union, a day after U.S. trade officials proposed a list of EU products to target as part of an ongoing aircraft dispute.
“The World Trade Organization finds that the European Union subsidies to Airbus has adversely impacted the United States, which will now put Tariffs on $11 Billion of EU products! The EU has taken advantage of the U.S. on trade for many years. It will soon stop!” Trump said in a post on Twitter.
The two sides have been locked in a years-long global trade dispute over mutual claims of illegal aid to plane giants, Netherlands-based Airbus and U.S.-based Boeing, to gain advantage in the world jet business.
The U.S. Trade Representative on Monday announced the planned products targeted in retaliation for European aircraft subsidies, with a final list expected this summer.
Meanwhile, the EU has started preparing to retaliate over Boeing subsidies, an EU official said on Tuesday.
The moves comes as the record subsidy dispute, which has been grinding its way through the WTO for almost 15 years, reaches a climax, with both sides in arbitration to decide the size of any countermeasures.
Reporting by Susan Heavey; Editing by Mohammad Zargham and Bernadette Baum

Source: Reuters

Market Insider | Stocks making the biggest moves premarket: Boeing, Disney, Wynn Resorts, Altria, Zogenix & more

Peter Schacknow




GP: Traders work on floor
Traders work on the floor of the New York Stock Exchange on March 04, 2019 in New York City.
Spencer Platt | Getty Images
Check out the companies making headlines before the bell:
Boeing Boeing remains on watch after falling nearly 4.5% Monday and dragging nearly 120 points off the Dow Jones Industrial Average by itself. A potential negative story has been rebutted this morning, with China Aircraft Leasing Group denying a newspaper report that it had put an order for 100 737 Max jets on hold.
Walt DisneyCowen upgraded Disney to “outperform” from “market perform,” predicting that Thursday’s investor day will be a “deck-clearing” event for positive sentiment. However, Cowen does note concerns about the recent acquisition of Fox assets as well as prospects for Disney’s direct-to-consumer offerings.
Fiat Chrysler Fiat Chrysler will pay $110 million to settle a lawsuit that it had misled investors about safety concerns surrounding excess diesel emissions. An investor group had sued the automaker in 2015, saying it had falsely claimed it was complying with safety regulations.
Wynn ResortsWynn is offering $7.1 billion for Australian casino operator Crown Resorts. Crown said talks between the two parties were at a preliminary stage, with the proposed bid consisting of 50% cash and 50% in Wynn shares.
Alcon Alcon will begin trading on the New York Stock Exchange today under the symbol “ALC,” following the Swiss eye care company’s spin-off from drugmaker Novartis.
Altria Altria has been asked by the Federal Trade Commission for more information on its investment in e-cigarette maker Juul. Altria, the maker of Marlboro cigarettes, bought a 35 percent stake in Juul for $12.8 billion in November, and is now seeking to convert its non-voting stake in Juul to voting shares.
SAPUBS downgraded the enterprise software maker’s stock to “neutral” from “buy,” saying it doesn’t foresee that the November acquisition of experience management company Qualtrics will transform SAP’s near-term prospects. UBS also feels that SAP’s gross margin targets may not be attainable.
PerkinElmer PerkinElmer was upgraded to “buy” from “neutral” at Goldman Sachs, with the life sciences company’s stock also added to Goldman’s “Conviction Buy” list. Goldman thinks PerkinElmer’s growth will accelerate beyond the Street’s consensus estimates.
Avaya Avaya is preparing to investigate a possible sale of the company, according to a Bloomberg report. That follows the receipt of unsolicited interest in the business communications company.
ZogenixZogenix shares are under pressure after the Food and Drug Administration refused to review a marketing application for the drugmaker’s seizure treatment. The FDA said the application was insufficient and would have to be resubmitted.
U.S. Steel The steelmaker’s stock was downgraded to underperform ” from “neutral” at Credit Suisse, which points to a weakened competitive position for U.S. Steel.

Source: CNBC

Health News | In New York, confusion reigns in the emerging CBD edibles business

Jonathan Allen



NEW YORK (Reuters) - New York state officials told food growers and processors in mid-December that they had the state’s blessing to produce and sell tea and chocolates laced with CBD, the cannabis derivative reputed to ease anxiety and other ills without marijuana’s high.
Products are displayed at Dorothy Stepnowska's Flower Power Coffee House, a CBD cafe, in the Queens borough of New York City, U.S., March 6, 2019. Picture taken March 6, 2019. REUTERS/Brendan McDermid
But since then, New York City health inspectors have seized thousands of dollars worth of CBD-infused food and drinks at the Fat Cat Kitchen and other local cafes and restaurants, and warned owners to stop selling them or face penalties. The crackdown came just weeks after federal law explicitly made CBD legal across the country.
The New York City crackdown highlights the inconsistencies that have emerged in federal, state and local rules governing CBD, bewildering the small but growing number of businesses selling edibles in New York and other states.
“I’m trying to be compliant with the law, but no one seems to be fully aware of what the law is and isn’t,” said C.J. Holm, the owner of the Fat Cat Kitchen, which touts CBD coffee and cookies on a sidewalk chalkboard.
Consumer interest in CBD tinctures, topical creams and edibles has grown in recent years in step with the piecemeal legalization of marijuana, which is now permitted as either a medical or recreational drug in 33 states while still banned by the federal government.
In 2018, U.S. consumers spent an estimated $300 million on CBD food and drinks, according to a report by Cowen Washington Research Group. The Coca-Cola Company and other food giants have expressed interest in the sector.
The 2018 Farm Bill, enacted in December, was intended in part to clear up the legal status of CBD by legalizing cannabis extracts derived from strains of the plant, known as hemp, that contain very low concentrations of THC, the main psychoactive compound in marijuana.
But the law also created new confusion for businesses wanting to sell CBD food or drink. For some, it is impossible to follow one set of regulations without being in breach of another.
In New York, for example, officials at the state Department of Agriculture issued guidance in December saying it was legal to sell “CBD tea,” “chocolates with CBD drizzle” and other CBD edibles, so long as the products are made and marketed as dietary supplements, which are governed by more stringent standards than ordinary food.
But the department also warns that doing this will run afoul of rules issued by the U.S. Food and Drug Administration, which said it was unlawful to add CBD to food or to market it as a dietary supplement. That is because the agency, for the first time last year, had approved a drug that contained CBD as the active ingredient.
New York City health inspectors have taken the FDA rule seriously. At the Fat Cat Kitchen, Holm was startled when a health inspector impounded her CBD powder, honey, snacks and raw cookie dough in February. Similar scenes played out at four other eateries in the city.
Soon afterward, Holm and other restaurateurs received a letter from the department saying inspectors would resume the seizures after July 1.
It is unclear whether the city’s Health Department will allow cafes and restaurants to sell CBD edibles even as a dietary supplement, despite New York state officials saying such products are legal.
When asked, Michael Lanza, a Health Department spokesman, repeated the department’s position that it is following the FDA ban on CBD food and drink in any form. An FDA spokesman declined to comment on New York’s regulations.
Colorado, Maine and other states have attempted to clarify the status of CBD-laced edibles by passing laws allowing the addition of CBD to food.
The FDA has said it may make an exception for CBD, allowing it as a food additive or dietary supplement even though it is now a listed drug. It will hold a public forum on the issue in Maryland on May 31.
Slideshow (21 Images)
With the conflicting rules and at best haphazard enforcement, Holm and other CBD vendors say they are pressing ahead, devising their own strategies that they feel are at least a gesture toward compliance.
Igor Yakovlev, who stirs CBD into honey on New York’s Staten Island, prints a disclaimer on each Beezy Beez Honey jar stating that the FDA has not “evaluated or approved” his product.
Holm, in consultation with a lawyer, noted that the FDA bans CBD being added to food for “interstate commerce,” and reasons she is fine to sell CBD coffee so long as the extract is produced and processed in New York.
“It is so confusing because you can ask three different attorneys and get three different answers,” said Allan Gandelman, a farmer in Cortland who founded the New York Cannabis Growers and Processors Association earlier this year. “So you decide you’re going to blaze a path forward, and produce a product that customers really want, and go for it until the government gets its act together.”
Reporting by Jonathan Allen in New York; Editing by Frank McGurty and Dan Grebler

Source: Reuters


Markets | Investors’ Hunger for Growth Pushes Tech Stocks to Record

The Wall Street Journal.
Markets Bull logo.
Markets
Hello. I'm Amrith Ramkumar, getting you set for Tuesday trading.
Futures are edging down after a quiet start to the week. Investors are looking ahead to tomorrow's inflation data and Fed minutes following the S&P 500's eighth consecutive advance.
Before we see if that winning streak can continue, I explain how the S&P 500 information-technology sector has risen to a fresh record faster than major indexes. 
 

Markets in a Minute

Markets Data
 

Overnight Developments

  • Global stocks mostly ticked higher on Tuesday, after the Trump administration took a step toward imposing tariffs on imports from Europe.
  • Read our full market wrap here
 

Historic Start to 2019 Pushes Tech to New Peak

Investors have embraced software and chip stocks early in the year. 
A group of the largest technology companies just hit an all-time high, highlighting investors’ renewed faith in software and chip companies after a fourth-quarter rout.
The S&P 500 information technology sector posted its first record close since early October on Monday, climbing for the seventh time in the last eight sessions. 
The group of 68 tech stocks notched a fresh closing record slightly faster than its broader brethren: the S&P 500 is 1.2% below its last record, while the tech-laden Nasdaq Composite is 1.9% off its last peak.
As investors have flocked back toward fast-growing companies early this year, technology shares have been among the best performers.
The S&P 500 technology group is up 23% in 2019, compared to a 16% advance for the broader index. That’s the sector’s best start to a year ever, according to Dow Jones Market Data.
With the U.S. and China closing in on a trade agreement and the Federal Reserve showing caution on further interest-rate increases, investors have once again favored companies that have consistently lifted sales in recent years.
Those stocks tumbled during last autumn’s volatility but are back leading the way as investors embrace risk.
“There’s a narrower list of businesses that are generating most of the growth today, so those are the ones that have been leading the market,” said Michael Lippert, who manages the Baron Capital Opportunity Fund. “I’m not sure that will change.”
Monday's record ended the S&P tech sector’s longest streak without an all-time high since July 2017. Before that, the prior record was 17 years earlier at the height of the dot-com bubble.
Despite tech’s almost uninterrupted rise to start the year, some analysts expect first-quarter earnings season to test the group. The S&P tech sector is expected to log an 11% drop in profits from a year earlier and a 1% dip in revenue, FactSet data show.
And because many tech stocks are associated with market momentum, some analysts caution that a setback on trade or downbeat economic data could send the group tumbling once again.
“When people get nervous about the market, those companies pull back,” Mr. Lippert said.
Are you buying technology and internet stocks? Let the author know your thoughts at amrith.ramkumar@wsj.comEmailed comments may be edited before publication in future newsletters, and please make sure to include your name and location.
Correction: Emerging markets are popular targets for carry traders because they often offer yields that are much higher than those found in developed countries. Monday's newsletter incorrectly stated that emerging markets offer yields much higher than those found in developing countries.

Market Facts

  • A ninth consecutive advance for the S&P 500 today would mark the index's longest winning streak since November 2004, according to Dow Jones Market Data.
     
  • About 6.05 billion shares changed hands on NYSE and Nasdaq exchanges Monday, the lowest full-day volume total since September, according to Dow Jones Market Data. Roughly 6.58 billion shares per day changed hands last week, the lowest weekly average volume figure since late November.
     
  • On this day in 1998, K-Tel International, which sold compilations of old rock’n’roll songs on late-night TV, announced that it would soon begin selling music over the Internet. The stock, which closed at $6.63 the day before, surged to $67.75 by May 4. Within two years, the stock had been delisted from Nasdaq and traded at about $2 a share.

Key Events

The International Monetary Fund releases its World Economic Outlook at 9 a.m. ET. In January, the IMF said the "global expansion has weakened" and cut its forecasts for 2019.
The job openings and labor turnover survey for February is out at 10 a.m.
Treasury Secretary Steven Mnuchin appears before House panels at 10 a.m. and 2 p.m. The official topics are Treasury's budget and the international financial system—but don't be surprised if the handling of President Trump's tax returns takes center stage.
Fed Vice Chairman Randal Quarles speaks on financial regulation at 5 p.m. and Vice Chairman Richard Clarida speaks on the Fed’s review of its strategy at 6:45 p.m.
 

Must Reads

Aramco's Ras Tanura oil refinery and oil terminal in Saudi Arabia. Potential investors have been told that Aramco wants its bonds to yield very close to or less than Saudi sovereign debt. PHOTO: AHMED JADALLAH/REUTERS
Aramco’s bond sale took flight as investor orders neared $60 billion. Aramco has won about $60 billion of orders for its closely watched debut bond sale, far outstripping the $10 billion targeted by the Saudi oil giant, as investors appeared to shrug off its ambitious pricing.
The Fed is moving to ease “living wills” for large banks. Federal regulators on Monday proposed easing a rule that required big banks to annually plan for their own demise. The chief executives of the largest U.S. banks plan to tell Congress on Wednesday that the financial system is less risky and more tightly supervised than it was before the 2008 crisis thanks to a series of regulatory reforms.
The SEC backed a nontransparent exchange-traded fund. Wall Street’s top regulator has paved the way for a new kind of ETF that won’t immediately disclose its investments to the public.
Patagonia triggered a panic over new rules on its power vests. The sportswear company announced restrictions on its custom-branded vests to firms that “prioritize the planet,” leaving aspiring tycoons out in the cold.
Frackers, chasing fast oil output, are on a treadmill. Shale companies from Texas to North Dakota are managing wells to maximize short-term oil production—and that has long-term consequences for the future of the U.S. energy boom.
GE shares slumped as a top analyst downgraded it to “sell” again. General Electric shares fell 5.2% after the company was downgraded to a “sell” rating by JPMorgan Chase, just four months after the bank upgraded its longtime bearish view.
The prospect of tougher rent regulations hit NYC building sales. Sales of New York City rental apartment buildings plummeted in the first quarter, signaling the uncertainty around rent regulation after the current law expires in a few weeks.
 

What We've Heard on the Street

“Food and drink companies haven’t had much stomach for deals recently. The lull is likely temporary, but it also might be getting harder for executives to rally support for blockbuster transactions.”
—Heard on the Street columnist Carol Ryan
 

Stocks to Watch

Twitter: Shares of the social-media company have climbed in eight consecutive sessions, their longest winning streak since early June.
Zogenix: The company said U.S. health regulators turned down its application for Fintepla, a treatment for seizures associated with Dravet syndrome, a rare form of epilepsy.
Symantec: The cybersecurity software company rose 5.4% Monday, its largest daily advance since Feb. 1. The surge came after Goldman Sachs upgraded the stock to buy from neutral.
Wynn Resorts: Shares of the casino operator climbed for the eighth consecutive session Monday to their highest level since late August. Monday’s advance came after Jefferies upgraded the stock to buy from hold.