MARKETWATCH Market Snapshot
"U.S. stock indexes rally toward best quarter in about 20 years despite warnings from Powell and Mnuchin on economy"
By Mark DeCambre
Published: June 30, 2020 at 3:09 p.m. ET
U.S. stock-indexes were higher Wednesday afternoon, as data showing recovering consumer confidence and higher home prices helped offset ongoing concerns about the rising number of new coronavirus cases in many American states.
Both the Dow and S&P 500 index are set to put in their best quarterly performance in more than 20 years, while the Nasdaq Composite is having its best quarter since the 2001 dotcom crash, as the indexes recovered from the lows seen in late March when the coronavirus crisis forced business activity to grind to a halt.
The stock market will be closed on Friday in observance of the Fourth of July holiday.
How are benchmarks performing?
The Dow Jones Industrial Average was 34 points higher, or 0.2%, at 25,633, those for the S&P 500 index rose 29 points, or 1%, at 3,082, while the Nasdaq Composite Index added 139 points, or 1.4%, at 10,013.
On Monday, the Dow gained 580.25 points, or 2.3%, its best one-day percentage climb since June 5, according to Dow Jones Market Data.
The S&P 500 index advanced 44.19 points, or 1.5%, to finish at 3,053.24.
The technology-laden Nasdaq Composite Index picked up 116.93 points, or 1.2%, to end at 9,874.15
What’s driving the market?
After a rally to start a holiday-shortened week, market participants were parsing joint testimony from Powell and Mnuchin about the U.S.’s economic response to the global public health disaster.
The two are speaking in front of the U.S. House of Representatives Financial Services Committee.
Mnuchin said the Treasury and Fed were looking at extending the Fed’s established 11 emergency lending facilities, but also reiterated that additional types of COVID-19 aid likely will need to be addressed by Congress under the next phase of stimulus.
The Fed’s Powell stressed that the ‘overriding goal’ of the central bank’s facilities is to help get the roughly 25 million workers who lost jobs during the pandemic back to work, while also warning that the worst part of a second wave of COVID-19 infections would be if it undermines consumer confidence.
“While this bounce back in economic activity is welcome, it also presents new challenges — notably, the need to keep the virus in check,” Powell said.
The hearing was the first update of its kind as required by the $2 trillion relief package Congress approved in March, coming as the global tally for confirmed cases of the coronavirus that causes COVID-19 rose to 10.3 million on Tuesday, according to data aggregated by Johns Hopkins University.
The number of deaths climbed to 505,518.
Within the U.S., infections have climbed in 35 states over the past 14 days, according to a New York Times tracker, with California, Texas and Florida leading the way.
“The government’s inability to restrain public behavior, even through something as simple as ensuring mask compliance, is a dangerous threat to the economy of the U.S.,” said Eric Schiffer, chief executive officer of private-equity firm Patriarch Organization, in Beverly Hills.
“It ensures this cycle of viral pain continues longer than it should,” he told MarketWatch.
Both New Jersey and New York, states that have been seeing a smaller rise in new cases, have said that they will be forced to delay aspects of their business reopening plans as the virus spreads elsewhere.
Ahead of that testimony, New York Fed President John Williams on Tuesday warned that the worst of the early days of the pandemic may be over, but noted that the economy remains damaged, at a virtual talk sponsored by the Institute of International Finance.
In a separate hearing Tuesday, public-health expert Dr. Anthony Fauci warned that the U.S. could see 100,00 new coronavirus infections a day in the U.S., unless everyone steps up their game.
Speaking at the Senate Health, Education, Labor and Pensions Committee in Washington, D.C., Fauci said many states have reopened too quickly, and people are not abiding by rules of social distancing.
However in U.S. economic data, the Case-Shiller house price index rose 4% on an annual basis in April.
Meanwhile, the index of consumer confidence rose to 98.1 this month from a revised 85.9 in May, the Conference Board said Tuesday, though the level of confidence still remains well below pre-crisis levels.
Separately, Atlanta Fed President Raphael Bostic and Minneapolis Federal Reserve Bank President Neel Kashkari is participating in a discussion on equality in the economy hosted by National Association of Business Economics.
Which stocks are in focus?
• Shares of Lululemon Athletica Inc. gained 5.2% on news it will acquire at-home fitness company Mirror for $500 million.
• Shares of Conagra Brands Inc. rose more than 5.7% on Tuesday after the owner of food brands, including Birds Eye and Healthy Choice, topped earnings estimates for its fiscal fourth quarter thanks to strong demand for at-home dining during the pandemic.
• FedEx Corp. is slated to report results after the close of trade Tuesday
• Wells Fargo shares fell 0.5% after the bank was one of the few major lenders to announce that it was cutting its dividends after bank stress tests conducted last week.
• Papa John’s International Inc. said Tuesday that same-store sales for the five weeks ended June 28 at its North America restaurants rose 24.4% from a year ago, and rose 6.0% internationally, as demand continued to be strong amid the COVID-19 pandemic.
Its stock fell 0.3%.
• Netlfix Inc. announced Tuesday an effort to grow economic opportunities for Black communities by allocating money to banks and other institutions that help provide financial support.
Shares were up 2.1%.
• Shares of Inovio Pharmaceuticals Inc. tumbled 20.7% Tuesday after the company, without disclosing relevant data, said its COVID-19 vaccine candidate was considered safe and well-tolerated in all 40 of the participants in a Phase 1 clinical trial.
• Tesla Inc. shares gained more than 7.4% on Tuesday, pushing the Silicon Valley car maker’s valuation above $200 billion, ahead of second-quarter sales numbers expected this week.
• Shares of Uber Technologies Inc. were up 4.7% following reports that the ride-hail service is close to a deal to buy privately held Postmates for about $2.6 billion.
How are other assets performing?
West Texas Intermediate U.S. crude for August delivery slipped 47 cents, or 1.2%, at $39.23 a barrel on the New York Mercantile Exchange.
In precious metals, gold futures shot up $16.80, or 1%, to trade at $1,798.10 an ounce.
The 10-year Treasury note yield was 3 basis points higher at 0.66%.
Bond prices move inversely to yields.
The greenback was down 0.2% against a basket of its major rivals, based on trading in the ICE U.S. Dollar Index.
In European equities, the Stoxx Europe 600 index closed 0.1% higher and London’s FTSE 100 fell 0.9%.
In Asian markets, the Japanese Nikkei gained 1.3%, Hong Kong’s Hang Seng picked up 0.5%, while South Korea’s Kospi climbed 0.7%.
China’s CSI 300 rallied 1.3%, while the Shanghai Composite Index advanced 0.8%.
https://www.marketwatch.com/story/dow-f ... od=markets
THE DAILY NEWS
Re: THE DAILY NEWS
MARKETWATCH Bond Report
"10-year Treasury yields hangs around six-week low as coronavirus fears dog Wall Street"
By Sunny Oh
Published: June 30, 2020 at 8:31 a.m. ET
Treasury yields ticked lower on Tuesday as worries about the rising number of COVID-19 cases in the U.S and around the world bolstered the bond-market, drawing inflows into haven assets like government paper.
What are Treasurys doing?
The 10-year Treasury note yield traded near a six-week low at 0.627%, compared with 0.636% the day before.
The 2-year yield sat at 0.145%, after closing at 0.158% on Monday.
The 30-year yield edged lower to 1.381%, from 1.390%.
What’s driving Treasurys?
Investors are watching the rising number of coronavirus cases in at least with 35 U.S. states which are resulting in business activity slowing again.
California Governor Gavin Newsom ordered bars in several of the state’s counties to close again.
Tedros Adhanom Ghebreyesus, head of the World Health Organization, on Monday said “the worse is yet to come,” regarding the state of the pandemic.
His remarks came a day after COVID-19 reached two milestones: 10 million confirmed infections worldwide, and 500,000 deaths.
Despite the growing worries about the pandemic, equities managed to shrug off those concerns on Monday, with the S&P 500 gaining 1.5%. S
tock-market futures, however, are pointing to a negative start Tuesday.
Fed Chairman Jerome Powell and U.S. Treasury Secretary Steven Mnuchin will speak in front of the House’s Committee on Financial Services.
In his prepared remarks, Powell said a full economic recovery was unlikely to take place if Americans did not feel safe.
New York Fed President John Williams and Fed Gov. Lael Brainard are also set to speak on Tuesday.
In U.S. economic data, April’s S&P CoreLogic Case-Shiller national home price index is set for release at 9 a.m. ET, followed by June’s Chicago purchasing managers’ index and the Conference Board’s consumer confidence index for this month at 10 a.m.
Over in China, the official manufacturing PMI for June came in at 50.9, according to the country’s National Bureau of Statistics.
Readings above 50 signify an expansion in economic activity, while those below signal contraction.
What did market participants’ say?
“The positive reaction on Wall Street seems all the more puzzling given the clear potential for the fresh and seemingly rampant rise in cases across the U.S. to see a further, notable challenge to U.S. economic growth later in the year,” said analysts at Rabobank.
https://www.marketwatch.com/story/10-ye ... cle_inline
"10-year Treasury yields hangs around six-week low as coronavirus fears dog Wall Street"
By Sunny Oh
Published: June 30, 2020 at 8:31 a.m. ET
Treasury yields ticked lower on Tuesday as worries about the rising number of COVID-19 cases in the U.S and around the world bolstered the bond-market, drawing inflows into haven assets like government paper.
What are Treasurys doing?
The 10-year Treasury note yield traded near a six-week low at 0.627%, compared with 0.636% the day before.
The 2-year yield sat at 0.145%, after closing at 0.158% on Monday.
The 30-year yield edged lower to 1.381%, from 1.390%.
What’s driving Treasurys?
Investors are watching the rising number of coronavirus cases in at least with 35 U.S. states which are resulting in business activity slowing again.
California Governor Gavin Newsom ordered bars in several of the state’s counties to close again.
Tedros Adhanom Ghebreyesus, head of the World Health Organization, on Monday said “the worse is yet to come,” regarding the state of the pandemic.
His remarks came a day after COVID-19 reached two milestones: 10 million confirmed infections worldwide, and 500,000 deaths.
Despite the growing worries about the pandemic, equities managed to shrug off those concerns on Monday, with the S&P 500 gaining 1.5%. S
tock-market futures, however, are pointing to a negative start Tuesday.
Fed Chairman Jerome Powell and U.S. Treasury Secretary Steven Mnuchin will speak in front of the House’s Committee on Financial Services.
In his prepared remarks, Powell said a full economic recovery was unlikely to take place if Americans did not feel safe.
New York Fed President John Williams and Fed Gov. Lael Brainard are also set to speak on Tuesday.
In U.S. economic data, April’s S&P CoreLogic Case-Shiller national home price index is set for release at 9 a.m. ET, followed by June’s Chicago purchasing managers’ index and the Conference Board’s consumer confidence index for this month at 10 a.m.
Over in China, the official manufacturing PMI for June came in at 50.9, according to the country’s National Bureau of Statistics.
Readings above 50 signify an expansion in economic activity, while those below signal contraction.
What did market participants’ say?
“The positive reaction on Wall Street seems all the more puzzling given the clear potential for the fresh and seemingly rampant rise in cases across the U.S. to see a further, notable challenge to U.S. economic growth later in the year,” said analysts at Rabobank.
https://www.marketwatch.com/story/10-ye ... cle_inline
Re: THE DAILY NEWS
MARKETWATCH
"Consumer confidence jumps to 3-month high, but still well below precrisis levels"
By Jeffry Bartash
Published: June 30, 2020 at 2:35 p.m. ET
The numbers:
Consumer confidence rose in June to a three-month high as a reopening economy buoyed the spirits of Americans, but a recent spike in coronavirus cases could dampen any optimism unless it’s brought under control soon.
The index of consumer confidence rose to 98.1 this month from a revised 85.9 in May, the Conference Board said Tuesday.
Economists polled by MarketWatch expected a reading of 90.8 in June.
One potentially big caveat: The cutoff date for the survey was June 18, shortly before states such as Texas and Arizona reimposed new restrictions after a fresh outbreak of COVID-19 cases.
The level of confidence is also well below precrisis levels after steep declines in March and April.
The index had stood near a 20-year high at 132.6 in February before the pandemic shut down swaths of the economy.
It fell to as low as 85.7 in April.
What happened:
An index that gauges how consumers feel about the economy right now rose to 86.2 from 68.4 in May.
Another gauge that assesses how Americans view the next six months — the so-called future expectations index —climbed to 106 from 97.6, just slightly below where it was before the virus spread.
The increase suggests consumers believe the virus will be less of a problem by the end of the year.
The share of Americans who said jobs were plentiful climbed to 20.8% from 16.5%.
The percentage who said jobs were hard to find dropped to 23.8% from 29.2%.
Big picture:
The rebound in consumer confidence signals that a rebound is under way after what might turn out to be the shortest but deepest recession in American history.
Yet the persistence of the virus points to a choppy recovery and a prolonged period of high unemployment.
What they are saying?
“Consumer confidence partially rebounded in June but remains well below pre-pandemic levels,” said Lynn Franco, senior director of economic indicators at the board.
“Faced with an uncertain and uneven path to recovery, and a potential COVID-19 resurgence, it’s too soon to say that consumers have turned the corner and are ready to begin spending at pre-pandemic levels.”
“Consumer confidence improved more than expected in June, but the survey may not have picked up much of the impact from rising Covid-19 case counts on sentiment in the latter half of the month,” said economist Andrew Grantham of CIBC Economics.
Market reaction:
The Dow Jones Industrial Average fell in early Tuesday trades while the S&P 500 index and Nasdaq advanced.
Stocks were little changed after the report.
https://www.marketwatch.com/story/consu ... cle_inline
"Consumer confidence jumps to 3-month high, but still well below precrisis levels"
By Jeffry Bartash
Published: June 30, 2020 at 2:35 p.m. ET
The numbers:
Consumer confidence rose in June to a three-month high as a reopening economy buoyed the spirits of Americans, but a recent spike in coronavirus cases could dampen any optimism unless it’s brought under control soon.
The index of consumer confidence rose to 98.1 this month from a revised 85.9 in May, the Conference Board said Tuesday.
Economists polled by MarketWatch expected a reading of 90.8 in June.
One potentially big caveat: The cutoff date for the survey was June 18, shortly before states such as Texas and Arizona reimposed new restrictions after a fresh outbreak of COVID-19 cases.
The level of confidence is also well below precrisis levels after steep declines in March and April.
The index had stood near a 20-year high at 132.6 in February before the pandemic shut down swaths of the economy.
It fell to as low as 85.7 in April.
What happened:
An index that gauges how consumers feel about the economy right now rose to 86.2 from 68.4 in May.
Another gauge that assesses how Americans view the next six months — the so-called future expectations index —climbed to 106 from 97.6, just slightly below where it was before the virus spread.
The increase suggests consumers believe the virus will be less of a problem by the end of the year.
The share of Americans who said jobs were plentiful climbed to 20.8% from 16.5%.
The percentage who said jobs were hard to find dropped to 23.8% from 29.2%.
Big picture:
The rebound in consumer confidence signals that a rebound is under way after what might turn out to be the shortest but deepest recession in American history.
Yet the persistence of the virus points to a choppy recovery and a prolonged period of high unemployment.
What they are saying?
“Consumer confidence partially rebounded in June but remains well below pre-pandemic levels,” said Lynn Franco, senior director of economic indicators at the board.
“Faced with an uncertain and uneven path to recovery, and a potential COVID-19 resurgence, it’s too soon to say that consumers have turned the corner and are ready to begin spending at pre-pandemic levels.”
“Consumer confidence improved more than expected in June, but the survey may not have picked up much of the impact from rising Covid-19 case counts on sentiment in the latter half of the month,” said economist Andrew Grantham of CIBC Economics.
Market reaction:
The Dow Jones Industrial Average fell in early Tuesday trades while the S&P 500 index and Nasdaq advanced.
Stocks were little changed after the report.
https://www.marketwatch.com/story/consu ... cle_inline
Re: THE DAILY NEWS
MARKETWATCH
"Home price gains remained steady in April as the coronavirus swept across the country, Case-Shiller index shows"
By Jacob Passy
Published: June 30, 2020 at 9:51 a.m. ET
The numbers:
Home-price appreciation maintained a steady pace in April, despite the spread of the coronavirus across the U.S., according to a major price barometer released Tuesday.
The S&P CoreLogic Case-Shiller 20-city price index posted a 4% year-over-year gain in April, up from 3.9% the previous month.
On a monthly basis, the index increased 0.9% between March and April.
Because of the two-month lag in the data included in the price index, this was the first report that accounted for the full effects of the coronavirus pandemic on the housing market.
What happened:
The national index reported as part of the report noted a 4.7% increase in home prices over the past year across America.
Phoenix continued to lead the country with an 8.8% annual price gain in April.
Seattle was next, with a 7.3% gain, followed by Minneapolis, where home prices rose 6.4% over the past year.
Prices were weaker in the Northeast.
Overall, the pace of price growth increased in 12 of the 19 cities Case-Shiller analyzed — the 20-city list once again didn’t include Detroit this month because transaction records for Wayne County, Mich., were unavailable, the report noted.
“This is, so far, the only directly visible impact of COVID-19 on the S&P CoreLogic Case-Shiller Indices,” Craig Lazzara, managing director and global head of index investment strategy at S&P Dow Jones Indices, said in the report.
“The price trend that was in place pre-pandemic seems so far to be undisturbed, at least at the national level.”
The big picture:
The coronavirus pandemic hasn’t put downward pressure on home prices, yet.
Last week, the Federal Housing Finance Agency released its monthly home price index, which similarly showed prices increasing on a monthly and yearly basis in April on average nationwide.
Of course, on a regional basis, some parts of the country did see downturns between March and April in the FHFA’s report, including New England and the South Atlantic region, which runs from Maryland to Florida.
Whether this trend will continue will depend largely on the trajectory of the coronavirus pandemic.
Until now, home-buying demand has remained high relative to a short supply of homes available for sale.
As states began reopening in May, home sales activity rebounded across much of the country.
But many of the states that reopened early are now seeing sharp upticks in the number of people testing positive for COVID-19.
As a result, states have had to reverse some of their reopening plans to slow the spread of the virus, and it’s not clear yet what effect that will have on consumer confidence or those states’ economies.
A recent report from Zillow indicated that a downturn in home prices could be delayed and might come in the second half of the year.
“The next question housing will face is whether this growth can continue after demand built up during housing’s brief pause in the pandemic’s early days runs its course,” Zillow senior principal economist Skylar Olsen said in the report.
“It’s likely housing will feel the broader economy’s downturn eventually, though to a mild degree, and home values will fall in the coming months.”
What they’re saying:
“The housing market is likely benefiting from low mortgage rates, stronger demand for larger spaces as more and more people work from home and a desire to move away from crowded cities to avoid exposure to the coronavirus,” said Rubeela Farooqi, chief U.S. economist for High Frequency Economics, in a research note.
https://www.marketwatch.com/story/home- ... cle_inline
"Home price gains remained steady in April as the coronavirus swept across the country, Case-Shiller index shows"
By Jacob Passy
Published: June 30, 2020 at 9:51 a.m. ET
The numbers:
Home-price appreciation maintained a steady pace in April, despite the spread of the coronavirus across the U.S., according to a major price barometer released Tuesday.
The S&P CoreLogic Case-Shiller 20-city price index posted a 4% year-over-year gain in April, up from 3.9% the previous month.
On a monthly basis, the index increased 0.9% between March and April.
Because of the two-month lag in the data included in the price index, this was the first report that accounted for the full effects of the coronavirus pandemic on the housing market.
What happened:
The national index reported as part of the report noted a 4.7% increase in home prices over the past year across America.
Phoenix continued to lead the country with an 8.8% annual price gain in April.
Seattle was next, with a 7.3% gain, followed by Minneapolis, where home prices rose 6.4% over the past year.
Prices were weaker in the Northeast.
Overall, the pace of price growth increased in 12 of the 19 cities Case-Shiller analyzed — the 20-city list once again didn’t include Detroit this month because transaction records for Wayne County, Mich., were unavailable, the report noted.
“This is, so far, the only directly visible impact of COVID-19 on the S&P CoreLogic Case-Shiller Indices,” Craig Lazzara, managing director and global head of index investment strategy at S&P Dow Jones Indices, said in the report.
“The price trend that was in place pre-pandemic seems so far to be undisturbed, at least at the national level.”
The big picture:
The coronavirus pandemic hasn’t put downward pressure on home prices, yet.
Last week, the Federal Housing Finance Agency released its monthly home price index, which similarly showed prices increasing on a monthly and yearly basis in April on average nationwide.
Of course, on a regional basis, some parts of the country did see downturns between March and April in the FHFA’s report, including New England and the South Atlantic region, which runs from Maryland to Florida.
Whether this trend will continue will depend largely on the trajectory of the coronavirus pandemic.
Until now, home-buying demand has remained high relative to a short supply of homes available for sale.
As states began reopening in May, home sales activity rebounded across much of the country.
But many of the states that reopened early are now seeing sharp upticks in the number of people testing positive for COVID-19.
As a result, states have had to reverse some of their reopening plans to slow the spread of the virus, and it’s not clear yet what effect that will have on consumer confidence or those states’ economies.
A recent report from Zillow indicated that a downturn in home prices could be delayed and might come in the second half of the year.
“The next question housing will face is whether this growth can continue after demand built up during housing’s brief pause in the pandemic’s early days runs its course,” Zillow senior principal economist Skylar Olsen said in the report.
“It’s likely housing will feel the broader economy’s downturn eventually, though to a mild degree, and home values will fall in the coming months.”
What they’re saying:
“The housing market is likely benefiting from low mortgage rates, stronger demand for larger spaces as more and more people work from home and a desire to move away from crowded cities to avoid exposure to the coronavirus,” said Rubeela Farooqi, chief U.S. economist for High Frequency Economics, in a research note.
https://www.marketwatch.com/story/home- ... cle_inline
Re: THE DAILY NEWS
MARKETWATCH - The Fed
"Fed’s Williams warns that U.S. economy far from healthy even if worst of the coronavirus outbreak is over"
By Greg Robb
Published: June 30, 2020 at 12:18 p.m. ET
The economy seems to be on the mend from the worst of the early days of the coronavirus pandemic but remains damaged, said New York Fed President John Williams on Tuesday.
“There have been signs that we may be past the worst of the extreme economic distress and early indications of a recovery have started to emerge,” Williams said, in a virtual talk sponsored by the Institute of International Finance.
Consumer spending has rebounded, and building permits have risen, which is a sign of strength in construction, Williams said.
In addition, the high unemployment rate has started to recede from peak levels, though job losses remain elevated.
“We are traveling down a narrow path, balancing a return of economic activity with effective containment of COVID-19,” New York Fed President John Williams.
While these improvement are welcome, “the economy is still far from healthy and a full recovery will likely take years to achieve,” Williams predicts.
The outbreak of COVID-19 will continue to be “at center stage” during the recovery, he said.
High-frequency economic data indicate that there are signs of a slowdown in southern and western states in the U.S., which are seeing a resurgence in cases of the disease derived from the novel strain of coronavirus.
“A strong economic recovery depends on effective and sustained containment of COVID-19,” he said.
At this point, however, health officials are focused on limiting the spread of the deadly pathogen.
Williams is a member of Fed Chairman Jerome Powell’s inner-circle.
His comments are similar to Powell’s prepared remarks that were released by the House Financial Services on Monday.
The Fed chairman will take questions from lawmakers starting at 12:30 p.m. Eastern.
Powell said the economy has entered an important new phase sooner than expected but said it comes with a challenge of keeping the virus in check.
Both Williams and Powell emphasized that much remains unknown about how the pandemic will play out in the months ahead.
“We are traveling down a narrow path, balancing a return of economic activity with effective containment of COVID-19,” he said.
Williams said the Fed’s purchases of over $2 trillion of assets and 11 lending programs have helped to loosen areas of financial markets that seized up back in March as the pandemic was taking root in the U.S.
The New York Fed president, which maintains a permanent vote as a part of the Federal Open Market Committee by dint of that position’s oversight of many of the nation’s largest financial institutions, said the central bank remains ready to use its “full range of tools to support the economy to bring about a full and robust recovery.”
During the question and answer session, Williams said he wouldn’t say the Fed would never use negative interest rates as a tool, but said he preferred other tools.
Asked what other policies the Fed might undertake, Williams said the Fed was collecting evidence and looking to get a “better read” on where the U.S. economy was likely to go.
Only then would the Fed think about other policy choices.
Stocks were trading mostly higher, with the Dow Jones Industrial Average, the S&P 500 index and the Nasdaq Composite rising near midday Tuesday trade.
https://www.marketwatch.com/story/feds- ... cle_inline
"Fed’s Williams warns that U.S. economy far from healthy even if worst of the coronavirus outbreak is over"
By Greg Robb
Published: June 30, 2020 at 12:18 p.m. ET
The economy seems to be on the mend from the worst of the early days of the coronavirus pandemic but remains damaged, said New York Fed President John Williams on Tuesday.
“There have been signs that we may be past the worst of the extreme economic distress and early indications of a recovery have started to emerge,” Williams said, in a virtual talk sponsored by the Institute of International Finance.
Consumer spending has rebounded, and building permits have risen, which is a sign of strength in construction, Williams said.
In addition, the high unemployment rate has started to recede from peak levels, though job losses remain elevated.
“We are traveling down a narrow path, balancing a return of economic activity with effective containment of COVID-19,” New York Fed President John Williams.
While these improvement are welcome, “the economy is still far from healthy and a full recovery will likely take years to achieve,” Williams predicts.
The outbreak of COVID-19 will continue to be “at center stage” during the recovery, he said.
High-frequency economic data indicate that there are signs of a slowdown in southern and western states in the U.S., which are seeing a resurgence in cases of the disease derived from the novel strain of coronavirus.
“A strong economic recovery depends on effective and sustained containment of COVID-19,” he said.
At this point, however, health officials are focused on limiting the spread of the deadly pathogen.
Williams is a member of Fed Chairman Jerome Powell’s inner-circle.
His comments are similar to Powell’s prepared remarks that were released by the House Financial Services on Monday.
The Fed chairman will take questions from lawmakers starting at 12:30 p.m. Eastern.
Powell said the economy has entered an important new phase sooner than expected but said it comes with a challenge of keeping the virus in check.
Both Williams and Powell emphasized that much remains unknown about how the pandemic will play out in the months ahead.
“We are traveling down a narrow path, balancing a return of economic activity with effective containment of COVID-19,” he said.
Williams said the Fed’s purchases of over $2 trillion of assets and 11 lending programs have helped to loosen areas of financial markets that seized up back in March as the pandemic was taking root in the U.S.
The New York Fed president, which maintains a permanent vote as a part of the Federal Open Market Committee by dint of that position’s oversight of many of the nation’s largest financial institutions, said the central bank remains ready to use its “full range of tools to support the economy to bring about a full and robust recovery.”
During the question and answer session, Williams said he wouldn’t say the Fed would never use negative interest rates as a tool, but said he preferred other tools.
Asked what other policies the Fed might undertake, Williams said the Fed was collecting evidence and looking to get a “better read” on where the U.S. economy was likely to go.
Only then would the Fed think about other policy choices.
Stocks were trading mostly higher, with the Dow Jones Industrial Average, the S&P 500 index and the Nasdaq Composite rising near midday Tuesday trade.
https://www.marketwatch.com/story/feds- ... cle_inline
Re: THE DAILY NEWS
MARKETWATCH Bond Report
"Treasury yields finish mostly higher to end a listless quarter of trading"
By Sunny Oh
Published: June 30, 2020 at 5:12 p.m. ET
Treasury yields mostly rose Tuesday, following the buoyant sentiment in the stock market, after a round of solid economic data bolstered investor hopes in the U.S. recovery despite a rising tally of COVID-19 cases.
What are Treasurys doing?
The 10-year Treasury note yield rose 1.7 basis points to 0.653%.
The two-year yield was barely changed at 0.152%, but stood at its lowest level in seven weeks.
The 30-year yield edged 2 basis points higher to 1.410%.
In a listless month, the two-year note was down 0.4 basis points, the 10-year note gained 0.3 basis points, while the 30-year bond yield was up 0.3 basis points.
For the second quarter, the two-year note fell 3.8 basis points, the 10-year note picked up 3.8 basis points, and the 30-year bond yield added 6.4 basis points.
What’s driving Treasurys?
In U.S. economic data, April’s S&P CoreLogic Case-Shiller national home price index rose 4.7% year-over-year in April.
June’s Chicago purchasing managers’ index rebounded slightly to 36.6 in June, after falling to a 38-year low in May.
Meanwhile, the Conference Board reported its index of consumer confidence rose to 98.1 this month from a revised 85.9 in May.
In China, the official manufacturing PMI for June came in at 50.9, according to the country’s National Bureau of Statistics.
Readings above 50 signify an expansion in economic activity, while those below 50 signal contraction.
This raft of strong data helped equities to shrug off concerns around the coronavirus, with major stock-market benchmarks booking their best quarter in around two decades on Tuesday.
Investors are watching the rising number of coronavirus cases in at least with 35 U.S. states which are resulting in business activity slowing again.
California Gov. Gavin Newsom ordered bars in several of the state’s counties to close again, and Arizona’s Gov. Doug Ducey said his state’s bars, gyms, movie theaters and water parks would be shut down for at least 30 days
Tedros Adhanom Ghebreyesus, head of the World Health Organization, on Monday said “the worst is yet to come,” regarding the state of the pandemic.
His remarks came a day after COVID-19 reached two milestones: 10 million confirmed infections worldwide, and 500,000 deaths.
Dr. Anthony Fauci, director of the National Institute of Allergy and Infectious Diseases, said Tuesday “we do need to open up again, no doubt about it, we want to get the economy back, but you’ve got to do it in a measured way, and now we’re seeing the consequence of community spread, which is even more difficult to contain.”
Fed Chairman Jerome Powell and U.S. Treasury Secretary Steven Mnuchin spoke in front of the House’s Committee on Financial Services.
Powell warned the U.S. recovery would suffer a setback if the virus was not brought under control.
New York Fed President John Williams said the U.S. economy was far from healthy even if worst of the coronavirus outbreak was over.
What did market participants say?
“The combination of better-than-expected consumer confidence and strong equity performance overshadowed any” rebalancing flows, as investors were expected to pull their gains away from equities and plough them into government bonds, said Ian Lyngen, head of U.S. rates strategy at BMO Capital Markets.
He also added portfolio managers may have rebalanced their portfolios well in advance of Tuesday, and, as a result, the bond market did not rally as it usually would at the end of the month and quarter.
https://www.marketwatch.com/story/10-ye ... latestnews
"Treasury yields finish mostly higher to end a listless quarter of trading"
By Sunny Oh
Published: June 30, 2020 at 5:12 p.m. ET
Treasury yields mostly rose Tuesday, following the buoyant sentiment in the stock market, after a round of solid economic data bolstered investor hopes in the U.S. recovery despite a rising tally of COVID-19 cases.
What are Treasurys doing?
The 10-year Treasury note yield rose 1.7 basis points to 0.653%.
The two-year yield was barely changed at 0.152%, but stood at its lowest level in seven weeks.
The 30-year yield edged 2 basis points higher to 1.410%.
In a listless month, the two-year note was down 0.4 basis points, the 10-year note gained 0.3 basis points, while the 30-year bond yield was up 0.3 basis points.
For the second quarter, the two-year note fell 3.8 basis points, the 10-year note picked up 3.8 basis points, and the 30-year bond yield added 6.4 basis points.
What’s driving Treasurys?
In U.S. economic data, April’s S&P CoreLogic Case-Shiller national home price index rose 4.7% year-over-year in April.
June’s Chicago purchasing managers’ index rebounded slightly to 36.6 in June, after falling to a 38-year low in May.
Meanwhile, the Conference Board reported its index of consumer confidence rose to 98.1 this month from a revised 85.9 in May.
In China, the official manufacturing PMI for June came in at 50.9, according to the country’s National Bureau of Statistics.
Readings above 50 signify an expansion in economic activity, while those below 50 signal contraction.
This raft of strong data helped equities to shrug off concerns around the coronavirus, with major stock-market benchmarks booking their best quarter in around two decades on Tuesday.
Investors are watching the rising number of coronavirus cases in at least with 35 U.S. states which are resulting in business activity slowing again.
California Gov. Gavin Newsom ordered bars in several of the state’s counties to close again, and Arizona’s Gov. Doug Ducey said his state’s bars, gyms, movie theaters and water parks would be shut down for at least 30 days
Tedros Adhanom Ghebreyesus, head of the World Health Organization, on Monday said “the worst is yet to come,” regarding the state of the pandemic.
His remarks came a day after COVID-19 reached two milestones: 10 million confirmed infections worldwide, and 500,000 deaths.
Dr. Anthony Fauci, director of the National Institute of Allergy and Infectious Diseases, said Tuesday “we do need to open up again, no doubt about it, we want to get the economy back, but you’ve got to do it in a measured way, and now we’re seeing the consequence of community spread, which is even more difficult to contain.”
Fed Chairman Jerome Powell and U.S. Treasury Secretary Steven Mnuchin spoke in front of the House’s Committee on Financial Services.
Powell warned the U.S. recovery would suffer a setback if the virus was not brought under control.
New York Fed President John Williams said the U.S. economy was far from healthy even if worst of the coronavirus outbreak was over.
What did market participants say?
“The combination of better-than-expected consumer confidence and strong equity performance overshadowed any” rebalancing flows, as investors were expected to pull their gains away from equities and plough them into government bonds, said Ian Lyngen, head of U.S. rates strategy at BMO Capital Markets.
He also added portfolio managers may have rebalanced their portfolios well in advance of Tuesday, and, as a result, the bond market did not rally as it usually would at the end of the month and quarter.
https://www.marketwatch.com/story/10-ye ... latestnews
Re: THE DAILY NEWS
MARKETWATCH
"Chicago PMI rebounds only slightly in June from 38-year low in prior month"
By Greg Robb
Published: June 30, 2020 at 9:55 a.m. ET
A measure of business conditions in the Chicago region rebounded slightly to 36.6 in June, after falling to a 38-year low in May.
Economists surveyed by Econoday had expected a stronger rebound to 44.5 from 32.3 in May.
Any reading below 50 indicates worsening conditions.
In the details, production and new orders saw gains, while supplier delivery and employment declined.
In a special question, more than half of the manufacturers plan a hiring freeze, while only 18% project expanding their workforce.
The Chicago PMI is the last of the regional manufacturing indices before the national ISM data for June is released on Wednesday.
https://www.marketwatch.com/story/chica ... cle_inline
"Chicago PMI rebounds only slightly in June from 38-year low in prior month"
By Greg Robb
Published: June 30, 2020 at 9:55 a.m. ET
A measure of business conditions in the Chicago region rebounded slightly to 36.6 in June, after falling to a 38-year low in May.
Economists surveyed by Econoday had expected a stronger rebound to 44.5 from 32.3 in May.
Any reading below 50 indicates worsening conditions.
In the details, production and new orders saw gains, while supplier delivery and employment declined.
In a special question, more than half of the manufacturers plan a hiring freeze, while only 18% project expanding their workforce.
The Chicago PMI is the last of the regional manufacturing indices before the national ISM data for June is released on Wednesday.
https://www.marketwatch.com/story/chica ... cle_inline
Re: THE DAILY NEWS
MARKETWATCH
"API data show weekly U.S. crude supplies down by more than 8 million barrels, sources say"
By Myra P. Saefong
Published: June 30, 2020 at 4:53 p.m. ET
The American Petroleum Institute reported late Tuesday that U.S. crude supplies fell by 8.2 million barrels for the week ended June 26, according to sources.
The API data also reportedly showed gasoline stockpiles down by 2.5 million barrels, while distillate inventories rose by 2.6 million barrels.
Crude stocks at the Cushing, Okla., storage hub, meanwhile, edged up by 164,000 barrels for the week, sources said.
Inventory data from the Energy Information Administration will be released Wednesday.
The EIA data are expected to show crude inventories declined by 2.7 million barrels last week, according to analysts polled by S&P Global Platts.
They also forecast a supply decline of 2.7 million barrels for gasoline and an increase of 900,000 barrels for distillate inventories.
August West Texas Intermediate crude was at $39.66 a barrel in electronic trading.
It settled Tuesday at $39.27 on the New York Mercantile Exchange.
https://www.marketwatch.com/story/api-d ... latestnews
"API data show weekly U.S. crude supplies down by more than 8 million barrels, sources say"
By Myra P. Saefong
Published: June 30, 2020 at 4:53 p.m. ET
The American Petroleum Institute reported late Tuesday that U.S. crude supplies fell by 8.2 million barrels for the week ended June 26, according to sources.
The API data also reportedly showed gasoline stockpiles down by 2.5 million barrels, while distillate inventories rose by 2.6 million barrels.
Crude stocks at the Cushing, Okla., storage hub, meanwhile, edged up by 164,000 barrels for the week, sources said.
Inventory data from the Energy Information Administration will be released Wednesday.
The EIA data are expected to show crude inventories declined by 2.7 million barrels last week, according to analysts polled by S&P Global Platts.
They also forecast a supply decline of 2.7 million barrels for gasoline and an increase of 900,000 barrels for distillate inventories.
August West Texas Intermediate crude was at $39.66 a barrel in electronic trading.
It settled Tuesday at $39.27 on the New York Mercantile Exchange.
https://www.marketwatch.com/story/api-d ... latestnews
Re: THE DAILY NEWS
ASSOCIATED PRESS
"'White power' flare-up in retirement haven reveals tensions"
By MIKE SCHNEIDER, Associated Press
29 JUNE 2020
THE VILLAGES, Fla. (AP) — There has always been a low-boil tension in The Villages retirement community between the Republican majority and the much smaller cohort of Democrats, but a veneer of good manners in “Florida's Friendliest Hometown" mostly prevailed on golf courses and at bridge tables.
Those tensions, though, flared two weeks ago during a golf-cart parade for President Donald Trump's birthday in which a man shouted, “White Power,” when confronted by anti-Trump protesters.
A video clip of that confrontation in America’s largest retirement community was tweeted approvingly by Trump last weekend and then taken down.
Some residents say they've never seen anything like the politically inspired hostilities that have surfaced over the past several months.
“It's like a powder keg here," said resident Alan Stone.
“And Trump is just stirring the pot."
In the past, when conflicting political views came up in The Villages, residents said it was best to say, “I disagree,” and quickly change the topic.
But the emphasis on good manners has been tested like never before in recent months with the spread of the new coronavirus, the resulting stock market gyrations for a population that largely lives off retirement investments, the presidential race and the calls for racial justice following the death of George Floyd at the hands of Minneapolis police.
“This has been brewing."
"Most people kind of agree not to discuss politics ... and it had been accepted that with things being so divisive, you don’t get into it,” said Catherine Hardy, chair of the Sumter County Democratic Party.
The Villages' population of more than 120,000 residents — among the fastest growing areas in the U.S. in the past decade — is about 98% white, according to the U.S. Census Bureau.
There are more than twice as many registered Republicans as registered Democrats in Sumter County, where most of The Villages is located.
The Trump parade occurred June 14 in the planned community immediately after a vigil was held by an African American philanthropic group to honor Floyd and the Black Lives Matter movement.
Most of the attendees at the vigil had left by the start of the Trump parade, although a white woman wearing “Black Lives Matter" on her shirt shouted profanities at the Trump supporters as they drove by in golf carts.
A man driving by in a golf car responded by shouting, “White Power," a racist slogan associated with white supremacists.
“Most people, up until now, even if people felt that way, it was socially unacceptable to voice it," Hardy said of the man's remark.
"The difference is under Trump, you can spew that hatred."
"What has changed is now it’s more acceptable."
The flare-up at the Trump parade doesn’t represent the vast majority of residents of The Villages, although with the election year, there are some people, “who are exercised" and are becoming more vocal in expressing their views, said John Calandro, chairman of the Sumter County Republican Party.
Because of the coronavirus, more residents than usual are staying at home and watching the news, rather than going to the retirement haven’s famous happy hours and dances in its town squares, he said.
Some residents worry that the tensions of the past few months may make retirees think twice about moving to The Villages, whose founders have been longtime donors to Republicans and GOP presidential candidates.
The Villages is often a popular campaign stop for GOP national and statewide candidates.
“I don't think The Villages wants this kind of publicity," Stone said.
“People are saying, ‘What the hell is going on in The Villages?'"
But Calandro said any dissension among residents is overblown.
Calandro said when he plays golf with his Democratic friends, the biggest fights they get into aren't about politics — they're about who gets to take an extra putt on the green without being penalized.
“We aren't having arguments on every street corner here," Calandro said.
“The Villages is still The Villages."
"We worked all of our lives to live here, and it’s a great place to live.”
___
Follow Mike Schneider on Twitter at https://twitter.com/MikeSchneiderAP
http://www.msn.com/en-us/news/politics/ ... &ocid=iehp
"'White power' flare-up in retirement haven reveals tensions"
By MIKE SCHNEIDER, Associated Press
29 JUNE 2020
THE VILLAGES, Fla. (AP) — There has always been a low-boil tension in The Villages retirement community between the Republican majority and the much smaller cohort of Democrats, but a veneer of good manners in “Florida's Friendliest Hometown" mostly prevailed on golf courses and at bridge tables.
Those tensions, though, flared two weeks ago during a golf-cart parade for President Donald Trump's birthday in which a man shouted, “White Power,” when confronted by anti-Trump protesters.
A video clip of that confrontation in America’s largest retirement community was tweeted approvingly by Trump last weekend and then taken down.
Some residents say they've never seen anything like the politically inspired hostilities that have surfaced over the past several months.
“It's like a powder keg here," said resident Alan Stone.
“And Trump is just stirring the pot."
In the past, when conflicting political views came up in The Villages, residents said it was best to say, “I disagree,” and quickly change the topic.
But the emphasis on good manners has been tested like never before in recent months with the spread of the new coronavirus, the resulting stock market gyrations for a population that largely lives off retirement investments, the presidential race and the calls for racial justice following the death of George Floyd at the hands of Minneapolis police.
“This has been brewing."
"Most people kind of agree not to discuss politics ... and it had been accepted that with things being so divisive, you don’t get into it,” said Catherine Hardy, chair of the Sumter County Democratic Party.
The Villages' population of more than 120,000 residents — among the fastest growing areas in the U.S. in the past decade — is about 98% white, according to the U.S. Census Bureau.
There are more than twice as many registered Republicans as registered Democrats in Sumter County, where most of The Villages is located.
The Trump parade occurred June 14 in the planned community immediately after a vigil was held by an African American philanthropic group to honor Floyd and the Black Lives Matter movement.
Most of the attendees at the vigil had left by the start of the Trump parade, although a white woman wearing “Black Lives Matter" on her shirt shouted profanities at the Trump supporters as they drove by in golf carts.
A man driving by in a golf car responded by shouting, “White Power," a racist slogan associated with white supremacists.
“Most people, up until now, even if people felt that way, it was socially unacceptable to voice it," Hardy said of the man's remark.
"The difference is under Trump, you can spew that hatred."
"What has changed is now it’s more acceptable."
The flare-up at the Trump parade doesn’t represent the vast majority of residents of The Villages, although with the election year, there are some people, “who are exercised" and are becoming more vocal in expressing their views, said John Calandro, chairman of the Sumter County Republican Party.
Because of the coronavirus, more residents than usual are staying at home and watching the news, rather than going to the retirement haven’s famous happy hours and dances in its town squares, he said.
Some residents worry that the tensions of the past few months may make retirees think twice about moving to The Villages, whose founders have been longtime donors to Republicans and GOP presidential candidates.
The Villages is often a popular campaign stop for GOP national and statewide candidates.
“I don't think The Villages wants this kind of publicity," Stone said.
“People are saying, ‘What the hell is going on in The Villages?'"
But Calandro said any dissension among residents is overblown.
Calandro said when he plays golf with his Democratic friends, the biggest fights they get into aren't about politics — they're about who gets to take an extra putt on the green without being penalized.
“We aren't having arguments on every street corner here," Calandro said.
“The Villages is still The Villages."
"We worked all of our lives to live here, and it’s a great place to live.”
___
Follow Mike Schneider on Twitter at https://twitter.com/MikeSchneiderAP
http://www.msn.com/en-us/news/politics/ ... &ocid=iehp
Re: THE DAILY NEWS
USA TODAY
"Fact check: Democratic Party did not found the KKK, did not start the Civil War"
Devon Link, USA TODAY
30 JUNE 2020
The claim:
The Democratic Party started the Civil War to preserve slavery and later the KKK.
As America marks a month of protests against systemic racism and many people draw comparisons between current events and the civil rights movement, an oversimplified trope about the Democratic Party’s racist past has been resurrected online.
“Friendly reminder that if you support the Democrat Party, you support the party that founded the KKK and start a civil war to keep their slaves," claims an image of a tweet Instagram user @snowflake.tears shared on June on 19.
Many Instagram users read between the lines for the tweet’s implication about the modern Democratic and Republican parties.
Some argued this past action discredited current liberal policies while others said it did not matter.
“Everyone knows that Abraham Lincoln fought to free the slaves, but he also created the Republican Party, and was the leader of it to help fight to free the slaves, yet it’s said that most black people still vote for Democrats who fought to keep the slaves,” user @shrukenshmuck commented.
“I’m a conservative but I find this argument pretty stupid because clearly that’s not what they support anymore, values change overtime,” user @james.dubee wrote.
Historians agree that although factions of the Democratic Party did majorly contribute to the Civil War's start and KKK's founding, it is inaccurate to say the party is responsible for either.
Instagram user @snowflake.tears has not yet returned USA TODAY’s request for comment.
This is not a new argument
Princeton University Edwards Professor of American History Tera Hunter told USA TODAY this trope is a fallback argument used to discredit current Democratic Party policies.
“At the core of the effort to discredit the current Democratic Party is the refusal to accept the realignment of the party structure in the mid-20th century,” Hunt said.
In September 2019, NPR host Shereen Marisol Maraji called the claim, “one of the most well-worn clapbacks in modern American politics.”
Comedian Trevor Noah tackled the misleading trope on an episode of "The Daily Show" in March 2016, after two CNN contributors debated the topic.
“Every time I go onto Facebook I see these things: ‘Did you know the Democrats are the real racist party and did you know the Republicans freed the slaves?’” Noah joked.
“A lot of people like to skip over the fact that when it comes to race relations, historically, Republicans and Democrats switched positions.”
A similar meme attributing the claim to U.S. Secretary of Housing and Urban Development Ben Carson has been circulating social media since November 2016.
“Who started the KKK?"
"That was Democrats."
"Who was the party of slavery?"
"Who was the part of Jim Crow and segregation?"
"Who opposed the Civil Rights Movement?"
"Who opposed voting rights?"
"It was all the Democrats,” the meme reads.
Other posts making more specific claims about the Democratic Party starting the Civil War or founding the KKK continue to circulate.
This trope was rated false by PolitiFact and the Associated Press in October 2018.
A faction of the Democratic Party started the Civil War
Abolitionists founded the Republican Party and elected President Abraham Lincoln in response to escalating tensions around slavery after the Kansas-Nebraska Bill of 1854 threatened the balance of slave states to free states.
Southern states, primarily lead by Democrats, initiated secession proceedings and launched the Civil War.
However, historians say the party is not to blame.
“The short answer is that the Democratic Party did not start the Civil War,” Hunter said.
“The war was initiated by Southern slaveholding states seceding from the United States.”
Smithsonian’s National Museum of American History Curator of Political and Military History, Jon Grinspan agreed with Hunter.
“A splinter of a splinter of a Democratic Party really contributed to the secession and the coming of the war,” he told USA TODAY.
“It would be wrong to say the Democratic Party started the Civil War."
"It would be right to say some Democrats really contributed to the start of the Civil War.”
Grinspan pointed to the many Democrats, nicknamed Copperheads, that fought for the Union as evidence that the Civil War was not Democrats versus Republicans.
KKK was founded by Democrats, but not the party
The Ku Klux Klan was founded in 1866 by ex-Confederate soldiers Frank McCord, Richard Reed, John Lester, John Kennedy, J. Calvin Jones and James Crowe in Pulaski, Tennessee.
The group was originally a “social club” but quickly became a violent white supremacist group.
Its first grand wizard was Nathan Bedford Forrest, an ex-Confederate general and prominent slave trader.
Experts agree the KKK attracted many ex-Confederate soldiers and Southerners who opposed Reconstruction, most of whom were Democrats.
Forrest even spoke at the 1868 Democratic National Convention.
“The KKK is almost a paramilitary organization that’s trying to benefit one party."
"It syncs up with the Democratic Party, which really was a racist party openly at the time,” Grinspan said.
“But the KKK isn’t the Democratic Party, and the Democratic Party isn’t the KKK.”
Although the KKK did serve the Democratic Party’s interests, Grinspan stressed that not all Democrats supported the KKK.
Anti-Defamation League’s Center on Extremism Senior Fellow Mark Pitcavage told the Associated Press that many KKK members were Democrats because the Whig Party had died off and Southerners disliked Republicans after the Civil War.
Despite KKK members' primary political affiliation, Pitcavage said it is wrong to say the Democratic Party started the KKK.
A reconstituted, early 20th century KKK attracts members from both sides
After Reconstruction and as the Jim Crow period set in during the 1870s, the Klan became obsolete.
Through violence, intimidation and systematic oppression, the KKK had served its purpose to help whites retake Southern governments.
In 1915, Cornell William J. Simmons restarted the KKK.
This second KKK was made up of Republicans and Democrats, although Democrats were more widely involved.
“The idea that these things overlap in a Venn diagram, the way they did with the first Klan, just isn’t as tight with the second Klan,” Grinspan said.
Political parties switch stance on racial progress
According to Grinspan, the Republican Party was much more concerned with protecting African Americans and their voting rights from its founding through the early 20th century.
In the mid-20th century, both parties' stances on racial equity began to switch.
“It starts with FDR and the New Deal, but the actions with Lyndon B. Johnson in the 1960s with the Voting Rights Act and civil rights legislation really kind of seals the deal,” Grinspan said.
As the Democrats introduced policies to support voting rights, it became the favored party for most Black voters and has remained so since.
With that realignment, many racist voters who opposed the Civil Rights Act of 1964 left the Democratic Party to become Republicans.
“That was 150 years ago and the parties are totally different today,” Grinspan said.
“It’s like a dinosaur to a modern-day bird."
"So much evolution has happened."
"These really aren’t the same groups anymore.”
Noah has mocked the political trope of highlighting the Democratic Party’s racist past to question its current progressive policies.
“That was true in like 1910, but then after World War II Democratic presidents like Truman and Johnson started supporting civil rights laws and that led to a mass exodus of racists from the Democratic Party,” Noah mocked the claim in 2016.
“Just because something used to be something doesn’t mean it still is."
"What matters more is what it is now.”
Our rating: False
We rate the claim that the Democratic Party started the Civil War to preserve slavery and founded the KKK as FALSE because it is not supported by our research.
Experts agree that although factions of the Democratic Party were responsible for the South's secession and the rise of the KKK it is inaccurate to claim the party is responsible for either.
The Democratic Party was undoubtedly the party of racism and white supremacy during and after the Civil War.
However, it evolved throughout the late 20th century, and garnered the support of most Black voters.
Our fact check sources:
USA TODAY, "'You have to keep at it': What Black Lives Matter demonstrators can learn from civil rights protests of the past"
Princeton University Edwards Professor of American History Tera Hunter
NPR, "The Original Blexit"
YouTube, "The Daily Show with Trevor Noah"
PolitiFact, "No, the Democratic Party didn’t create the Ku Klux Klan"
Associated Press, "Ku Klux Klan not founded by the Democratic Party"
History.com, "Republican Party Founded"
Smithsonian National Museum of American History Curator Jon Grinspan
Encyclopedia Britannica, "Copperhead"
Khan Academy, "The First KKK"
Encyclopedia Britannica, "Ku Klux Klan"
This article originally appeared on USA TODAY: Fact check: Democratic Party did not found the KKK, did not start the Civil War
http://www.msn.com/en-us/news/us/fact-c ... &ocid=iehp
"Fact check: Democratic Party did not found the KKK, did not start the Civil War"
Devon Link, USA TODAY
30 JUNE 2020
The claim:
The Democratic Party started the Civil War to preserve slavery and later the KKK.
As America marks a month of protests against systemic racism and many people draw comparisons between current events and the civil rights movement, an oversimplified trope about the Democratic Party’s racist past has been resurrected online.
“Friendly reminder that if you support the Democrat Party, you support the party that founded the KKK and start a civil war to keep their slaves," claims an image of a tweet Instagram user @snowflake.tears shared on June on 19.
Many Instagram users read between the lines for the tweet’s implication about the modern Democratic and Republican parties.
Some argued this past action discredited current liberal policies while others said it did not matter.
“Everyone knows that Abraham Lincoln fought to free the slaves, but he also created the Republican Party, and was the leader of it to help fight to free the slaves, yet it’s said that most black people still vote for Democrats who fought to keep the slaves,” user @shrukenshmuck commented.
“I’m a conservative but I find this argument pretty stupid because clearly that’s not what they support anymore, values change overtime,” user @james.dubee wrote.
Historians agree that although factions of the Democratic Party did majorly contribute to the Civil War's start and KKK's founding, it is inaccurate to say the party is responsible for either.
Instagram user @snowflake.tears has not yet returned USA TODAY’s request for comment.
This is not a new argument
Princeton University Edwards Professor of American History Tera Hunter told USA TODAY this trope is a fallback argument used to discredit current Democratic Party policies.
“At the core of the effort to discredit the current Democratic Party is the refusal to accept the realignment of the party structure in the mid-20th century,” Hunt said.
In September 2019, NPR host Shereen Marisol Maraji called the claim, “one of the most well-worn clapbacks in modern American politics.”
Comedian Trevor Noah tackled the misleading trope on an episode of "The Daily Show" in March 2016, after two CNN contributors debated the topic.
“Every time I go onto Facebook I see these things: ‘Did you know the Democrats are the real racist party and did you know the Republicans freed the slaves?’” Noah joked.
“A lot of people like to skip over the fact that when it comes to race relations, historically, Republicans and Democrats switched positions.”
A similar meme attributing the claim to U.S. Secretary of Housing and Urban Development Ben Carson has been circulating social media since November 2016.
“Who started the KKK?"
"That was Democrats."
"Who was the party of slavery?"
"Who was the part of Jim Crow and segregation?"
"Who opposed the Civil Rights Movement?"
"Who opposed voting rights?"
"It was all the Democrats,” the meme reads.
Other posts making more specific claims about the Democratic Party starting the Civil War or founding the KKK continue to circulate.
This trope was rated false by PolitiFact and the Associated Press in October 2018.
A faction of the Democratic Party started the Civil War
Abolitionists founded the Republican Party and elected President Abraham Lincoln in response to escalating tensions around slavery after the Kansas-Nebraska Bill of 1854 threatened the balance of slave states to free states.
Southern states, primarily lead by Democrats, initiated secession proceedings and launched the Civil War.
However, historians say the party is not to blame.
“The short answer is that the Democratic Party did not start the Civil War,” Hunter said.
“The war was initiated by Southern slaveholding states seceding from the United States.”
Smithsonian’s National Museum of American History Curator of Political and Military History, Jon Grinspan agreed with Hunter.
“A splinter of a splinter of a Democratic Party really contributed to the secession and the coming of the war,” he told USA TODAY.
“It would be wrong to say the Democratic Party started the Civil War."
"It would be right to say some Democrats really contributed to the start of the Civil War.”
Grinspan pointed to the many Democrats, nicknamed Copperheads, that fought for the Union as evidence that the Civil War was not Democrats versus Republicans.
KKK was founded by Democrats, but not the party
The Ku Klux Klan was founded in 1866 by ex-Confederate soldiers Frank McCord, Richard Reed, John Lester, John Kennedy, J. Calvin Jones and James Crowe in Pulaski, Tennessee.
The group was originally a “social club” but quickly became a violent white supremacist group.
Its first grand wizard was Nathan Bedford Forrest, an ex-Confederate general and prominent slave trader.
Experts agree the KKK attracted many ex-Confederate soldiers and Southerners who opposed Reconstruction, most of whom were Democrats.
Forrest even spoke at the 1868 Democratic National Convention.
“The KKK is almost a paramilitary organization that’s trying to benefit one party."
"It syncs up with the Democratic Party, which really was a racist party openly at the time,” Grinspan said.
“But the KKK isn’t the Democratic Party, and the Democratic Party isn’t the KKK.”
Although the KKK did serve the Democratic Party’s interests, Grinspan stressed that not all Democrats supported the KKK.
Anti-Defamation League’s Center on Extremism Senior Fellow Mark Pitcavage told the Associated Press that many KKK members were Democrats because the Whig Party had died off and Southerners disliked Republicans after the Civil War.
Despite KKK members' primary political affiliation, Pitcavage said it is wrong to say the Democratic Party started the KKK.
A reconstituted, early 20th century KKK attracts members from both sides
After Reconstruction and as the Jim Crow period set in during the 1870s, the Klan became obsolete.
Through violence, intimidation and systematic oppression, the KKK had served its purpose to help whites retake Southern governments.
In 1915, Cornell William J. Simmons restarted the KKK.
This second KKK was made up of Republicans and Democrats, although Democrats were more widely involved.
“The idea that these things overlap in a Venn diagram, the way they did with the first Klan, just isn’t as tight with the second Klan,” Grinspan said.
Political parties switch stance on racial progress
According to Grinspan, the Republican Party was much more concerned with protecting African Americans and their voting rights from its founding through the early 20th century.
In the mid-20th century, both parties' stances on racial equity began to switch.
“It starts with FDR and the New Deal, but the actions with Lyndon B. Johnson in the 1960s with the Voting Rights Act and civil rights legislation really kind of seals the deal,” Grinspan said.
As the Democrats introduced policies to support voting rights, it became the favored party for most Black voters and has remained so since.
With that realignment, many racist voters who opposed the Civil Rights Act of 1964 left the Democratic Party to become Republicans.
“That was 150 years ago and the parties are totally different today,” Grinspan said.
“It’s like a dinosaur to a modern-day bird."
"So much evolution has happened."
"These really aren’t the same groups anymore.”
Noah has mocked the political trope of highlighting the Democratic Party’s racist past to question its current progressive policies.
“That was true in like 1910, but then after World War II Democratic presidents like Truman and Johnson started supporting civil rights laws and that led to a mass exodus of racists from the Democratic Party,” Noah mocked the claim in 2016.
“Just because something used to be something doesn’t mean it still is."
"What matters more is what it is now.”
Our rating: False
We rate the claim that the Democratic Party started the Civil War to preserve slavery and founded the KKK as FALSE because it is not supported by our research.
Experts agree that although factions of the Democratic Party were responsible for the South's secession and the rise of the KKK it is inaccurate to claim the party is responsible for either.
The Democratic Party was undoubtedly the party of racism and white supremacy during and after the Civil War.
However, it evolved throughout the late 20th century, and garnered the support of most Black voters.
Our fact check sources:
USA TODAY, "'You have to keep at it': What Black Lives Matter demonstrators can learn from civil rights protests of the past"
Princeton University Edwards Professor of American History Tera Hunter
NPR, "The Original Blexit"
YouTube, "The Daily Show with Trevor Noah"
PolitiFact, "No, the Democratic Party didn’t create the Ku Klux Klan"
Associated Press, "Ku Klux Klan not founded by the Democratic Party"
History.com, "Republican Party Founded"
Smithsonian National Museum of American History Curator Jon Grinspan
Encyclopedia Britannica, "Copperhead"
Khan Academy, "The First KKK"
Encyclopedia Britannica, "Ku Klux Klan"
This article originally appeared on USA TODAY: Fact check: Democratic Party did not found the KKK, did not start the Civil War
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