FOX News
"Biden takes heat over gaffe urging Americans to 'choose freedom over democracy:' 'Get this man out of office!'"
Story by Gabriel Hays
20 APRIL 2024
Critics of President Biden slammed him on social media for making a puzzling statement encouraging voters to "choose freedom over democracy" by re-electing him to the presidency.
Conservatives expressed confusion over Biden’s message, and others insisted it was yet another gaffe showing his cognitive decline.
Biden made the claim while accepting the formal presidential endorsement of the Kennedy family in Pennsylvania on Thursday.
During the political rally, half a dozen Kennedy family members appeared alongside President Biden to publicly back him over Robert F. Kennedy, Jr., who is running as an independent candidate for president in 2024.
Kennedy Jr.’s own sister Kerry Kennedy spoke at the event, stating, "President Biden has been a champion for all the rights and freedoms that my father and uncles stood for."
After being introduced by the Kennedys, Biden addressed the crowd.
Towards the end of his speech, he asked "Are you ready to choose unity over division?"
"Dignity over demolition?"
"Truth over lies?"
"Are you ready to choose freedom over democracy?"
"Because that's America."
The last stanza turned heads with its seemingly contradictory message.
Author and Canary CEO Dan K. Eberhart commented, "He's fine."
"Everything's fine."
"Biden is definitely not in severe mental decline."
"Pay no attention to the man behind the curtain."
Commentator Ian Miles Cheong appeared confused by Biden’s statement, posting, "What did he mean by this?"
Conservative journalist Nick Sortor also asked, "What the hell is this guy saying?"
Journalist Marlo Nawfal posted, "Dems really need to upgrade his [operating system] or something..."
Conservative political influencer "Bad Hombre" remarked, "Biden says he wants you to ‘choose freedom OVER democracy.’"
"Joe’s DOJ, state prosecutors, and Secretaries of State have been working tirelessly to get rid of democracy."
"Just another Freudian slip."
The account for outlet "The Conservative Brief" posted about the gaffe, stating, "When people were concerned about Ronald Reagan having cognitive decline near the end of his second term, it was nothing like this."
"When Dan Quayle couldn't spell 'potato' correctly, people lost their minds."
"But it was nothing like this."
"When George W. Bush was in the Oval Office, and people said Dick Cheney was running the country because he couldn't, it was nothing like this.
"Look in the mirror and ask yourself, truthfully, if this is the man you want in charge of our security, our economy, and our country for another four years?" the post added.
Conservative podcast host Rob Coates urged voters, "Dear lord, get this man out of office!"
https://www.msn.com/en-us/news/politics ... e47a&ei=20
POLITICS
Re: POLITICS
RED STATE
"It's 'Vietnam All Over Again' As Defense Department Prepares to Beef Up Number of US Advisers in Ukraine"
By streiff
April 20, 2024
The Department of Defense is considering upping the number of US military advisers stationed in Ukraine.
Politico said, "The advisers would not be in a combat role, but rather would advise and support the Ukrainian government and military."
“Throughout this conflict, the DOD has reviewed and adjusted our presence in-country, as security conditions have evolved."
"Currently, we are considering sending several additional advisers to augment the Office of Defense Cooperation (ODC) at the Embassy,” Ryder said in a statement to POLITICO, noting that “personnel are subject to the same travel restrictions as all embassy employees."
The ODC “performs a variety of advisory and support missions (non-combat), and while it is staffed exclusively by DOD personnel, it is embedded within the U.S. Embassy, under Chief of Mission authority like the rest of the Embassy,” Ryder added.
Ryder declined to discuss specific numbers of personnel “for operational security and force protection reasons.”
According to the most recent data (December 2023), 18 Army/Air Force personnel and one Department of Defense civilian are assigned to Ukraine.
Two anonymous US officials say that number could rise to 60.
The role of the current group of soldiers assigned to Ukraine is to provide security for the US embassy, as Defense data indicates there are no Marines in Ukraine, and oversee the accountability of weapons and equipment.
The new group will assist the Ukrainians with developing maintenance facilities for US-made weapons systems.
While necessary to comply with the level of accountability of weapons and ammunition demanded by Congress and the Department of Defense, the atmospherics are terrible.
One of the constant drumbeats one hears on social media is the inevitability of US "boots on the ground" (where else would boots be? Other than up your butt).
The unfortunate use of the word "advisers" will cause split aortas all over the rather large pro-Russia, pro-Putin segment of the online right.
The US has successfully deployed advisers into hot conflicts without mishaps or the US becoming embroiled in a war.
The last such instance was in El Salvador during Reagan's campaign to roll back communism.
The role of advisers in South Vietnam (Laos, Cambodia, and Thailand) did not lead to war but reflected a greater US role in a war inherited from the French.
The role of those advisers was combat-oriented; this is not the case in Ukraine.
One of the critical roles of US advisers in Southeast Asia was training indigenous armies.
This is done today by sending Ukrainian units out of Ukraine to the UK, Germany, or other locations for training.
Under a worst-case scenario, a Russian attack on US advisers only results in direct combat between US and Russian troops if the US president decides to pursue that course of action.
There is no legal requirement that the deaths of American servicemen be followed by a massive troop deployment.
In fact, the last forty or so years of US diplomatic history indicate that the quickest way to get America out of an area is by killing some Americans (see Beirut and Mogadishu).
Calling US troops in Ukraine "advisers" is the kind of footshot that we've grown accustomed to from the Biden Defense and State Departments.
Claiming that advisers inevitably mean direct conflict with Russian forces is the kind of hyperbolic conspiracism that parts of the right insist on trafficking in because they don't want to be taken seriously.
Streiff
Former infantry officer, CGSC grad and Army Operations Center alumnus. Also an amateur historian (Colonial America) and a dabbler in historical fiction.
https://redstate.com/streiff/2024/04/20 ... b7cc655b1d
"It's 'Vietnam All Over Again' As Defense Department Prepares to Beef Up Number of US Advisers in Ukraine"
By streiff
April 20, 2024
The Department of Defense is considering upping the number of US military advisers stationed in Ukraine.
Politico said, "The advisers would not be in a combat role, but rather would advise and support the Ukrainian government and military."
“Throughout this conflict, the DOD has reviewed and adjusted our presence in-country, as security conditions have evolved."
"Currently, we are considering sending several additional advisers to augment the Office of Defense Cooperation (ODC) at the Embassy,” Ryder said in a statement to POLITICO, noting that “personnel are subject to the same travel restrictions as all embassy employees."
The ODC “performs a variety of advisory and support missions (non-combat), and while it is staffed exclusively by DOD personnel, it is embedded within the U.S. Embassy, under Chief of Mission authority like the rest of the Embassy,” Ryder added.
Ryder declined to discuss specific numbers of personnel “for operational security and force protection reasons.”
According to the most recent data (December 2023), 18 Army/Air Force personnel and one Department of Defense civilian are assigned to Ukraine.
Two anonymous US officials say that number could rise to 60.
The role of the current group of soldiers assigned to Ukraine is to provide security for the US embassy, as Defense data indicates there are no Marines in Ukraine, and oversee the accountability of weapons and equipment.
The new group will assist the Ukrainians with developing maintenance facilities for US-made weapons systems.
While necessary to comply with the level of accountability of weapons and ammunition demanded by Congress and the Department of Defense, the atmospherics are terrible.
One of the constant drumbeats one hears on social media is the inevitability of US "boots on the ground" (where else would boots be? Other than up your butt).
The unfortunate use of the word "advisers" will cause split aortas all over the rather large pro-Russia, pro-Putin segment of the online right.
The US has successfully deployed advisers into hot conflicts without mishaps or the US becoming embroiled in a war.
The last such instance was in El Salvador during Reagan's campaign to roll back communism.
The role of advisers in South Vietnam (Laos, Cambodia, and Thailand) did not lead to war but reflected a greater US role in a war inherited from the French.
The role of those advisers was combat-oriented; this is not the case in Ukraine.
One of the critical roles of US advisers in Southeast Asia was training indigenous armies.
This is done today by sending Ukrainian units out of Ukraine to the UK, Germany, or other locations for training.
Under a worst-case scenario, a Russian attack on US advisers only results in direct combat between US and Russian troops if the US president decides to pursue that course of action.
There is no legal requirement that the deaths of American servicemen be followed by a massive troop deployment.
In fact, the last forty or so years of US diplomatic history indicate that the quickest way to get America out of an area is by killing some Americans (see Beirut and Mogadishu).
Calling US troops in Ukraine "advisers" is the kind of footshot that we've grown accustomed to from the Biden Defense and State Departments.
Claiming that advisers inevitably mean direct conflict with Russian forces is the kind of hyperbolic conspiracism that parts of the right insist on trafficking in because they don't want to be taken seriously.
Streiff
Former infantry officer, CGSC grad and Army Operations Center alumnus. Also an amateur historian (Colonial America) and a dabbler in historical fiction.
https://redstate.com/streiff/2024/04/20 ... b7cc655b1d
Re: POLITICS
THE GUARDIAN
"‘Lost for words’: Joe Biden’s tale about cannibals bemuses Papua New Guinea residents - President’s suggestion that his ‘Uncle Bosie’ was eaten by cannibals harms US efforts to build Pacific ties, say local experts"
Rebecca Ratcliffe and Bethanie Harriman
Thu 18 Apr 2024
Joe Biden’s suggestion that his uncle may have been eaten by cannibals in Papua New Guinea during world war two has been met with a mixture of bemusement and criticism in the country.
Biden spoke about his uncle, 2nd Lt Ambrose J Finnegan Jr, while campaigning in Pittsburgh on Wednesday, describing how “Uncle Bosie” had flown single engine planes as reconnaissance flights during the war.
Biden said he “got shot down in New Guinea”, adding “they never found the body because there used to be a lot of cannibals, for real, in that part of New Guinea.”
Official war records say Finnegan was killed when a plane on which he was a passenger experienced engine failure and crashed into the Pacific Ocean.
The records do not mention cannibalism or state that the plane was shot down.
Analysts in Papua New Guinea who were shown his comments described the claims as unsubstantiated and poorly judged, pointing out that they come at a time when US has been seeking to strengthen its ties with the country, and counter Chinese influence in the Pacific region.
“The Melanesian group of people, who Papua New Guinea is part of, are a very proud people,” said Michael Kabuni, a lecturer in political science at the University of Papua New Guinea.
“And they would find this kind of categorisation very offensive."
"Not because someone says ‘oh there used to be cannibalism in PNG’ – yes, we know that, that’s a fact."
“But taking it out of context, and implying that your [uncle] jumps out of the plane and somehow we think it’s a good meal is unacceptable.”
Cannibalism was practised by some communities in the past in specific contexts, said Kabuni, such as eating a deceased relative out of respect, to prevent their body from decomposing.
“There was context."
"They wouldn’t just eat any white men that fell from the sky,” said Kabuni.
The practice was not due to people lacking food, he added, pointing out that archaeological evidence illustrates that agriculture was practised in Papua New Guinea more than 10,000 years ago.
About 79,000 US soldiers remain unaccounted following the second world war, Kabuni added.
“They’re spread from south-east Asia to the Korean peninsula and Europe."
"What is [Biden] implying?"
"All 79,000 that were never found were eaten?”
Others were simply bemused by the remarks.
“I am lost for words actually,” said Allan Bird, governor of the province of East Sepik, who was recently selected as the alternate prime minister for the opposition.
“I don’t feel offended."
"It’s hilarious really."
"I am sure when Biden was a child, those are the things he heard his parents say."
"And it probably stuck with him all his life.”
Maholopa Laveil, economics lecturer at the University of Papua New Guinea, said the claims were unhelpful, and pointed out that it comes after Biden cancelled a brief trip to the country last year.
“It paints PNG in a bad light."
"PNG has already had a lot of negative press around riots and tribal fighting and this doesn’t help, and [the claims are] unsubstantiated,” he said.
“For a US president to say that – particularly after a lot of deals have been struck with PNG and the work they’ve been doing in the Pacific – even off the cuff, I don’t think that should have been said at all,” said Maholopa.
According to the Pentagon’s Defense POW/MIA Accounting Agency, Biden’s uncle died on 14 May 1944, while a passenger on an A-20 havoc aircraft that departed Momote Airfield, Los Negros Island, bound for Nadzab airfield, New Guinea.
“For unknown reasons, this plane was forced to ditch in the ocean off the north coast of New Guinea,” the agency says.
“Both engines failed at low altitude, and the aircraft’s nose hit the water hard."
"Three men failed to emerge from the sinking wreck and were lost in the crash."
"One crew member survived and was rescued by a passing barge."
"An aerial search the next day found no trace of the missing aircraft or the lost crew members.”
https://www.theguardian.com/us-news/202 ... new-guinea
"‘Lost for words’: Joe Biden’s tale about cannibals bemuses Papua New Guinea residents - President’s suggestion that his ‘Uncle Bosie’ was eaten by cannibals harms US efforts to build Pacific ties, say local experts"
Rebecca Ratcliffe and Bethanie Harriman
Thu 18 Apr 2024
Joe Biden’s suggestion that his uncle may have been eaten by cannibals in Papua New Guinea during world war two has been met with a mixture of bemusement and criticism in the country.
Biden spoke about his uncle, 2nd Lt Ambrose J Finnegan Jr, while campaigning in Pittsburgh on Wednesday, describing how “Uncle Bosie” had flown single engine planes as reconnaissance flights during the war.
Biden said he “got shot down in New Guinea”, adding “they never found the body because there used to be a lot of cannibals, for real, in that part of New Guinea.”
Official war records say Finnegan was killed when a plane on which he was a passenger experienced engine failure and crashed into the Pacific Ocean.
The records do not mention cannibalism or state that the plane was shot down.
Analysts in Papua New Guinea who were shown his comments described the claims as unsubstantiated and poorly judged, pointing out that they come at a time when US has been seeking to strengthen its ties with the country, and counter Chinese influence in the Pacific region.
“The Melanesian group of people, who Papua New Guinea is part of, are a very proud people,” said Michael Kabuni, a lecturer in political science at the University of Papua New Guinea.
“And they would find this kind of categorisation very offensive."
"Not because someone says ‘oh there used to be cannibalism in PNG’ – yes, we know that, that’s a fact."
“But taking it out of context, and implying that your [uncle] jumps out of the plane and somehow we think it’s a good meal is unacceptable.”
Cannibalism was practised by some communities in the past in specific contexts, said Kabuni, such as eating a deceased relative out of respect, to prevent their body from decomposing.
“There was context."
"They wouldn’t just eat any white men that fell from the sky,” said Kabuni.
The practice was not due to people lacking food, he added, pointing out that archaeological evidence illustrates that agriculture was practised in Papua New Guinea more than 10,000 years ago.
About 79,000 US soldiers remain unaccounted following the second world war, Kabuni added.
“They’re spread from south-east Asia to the Korean peninsula and Europe."
"What is [Biden] implying?"
"All 79,000 that were never found were eaten?”
Others were simply bemused by the remarks.
“I am lost for words actually,” said Allan Bird, governor of the province of East Sepik, who was recently selected as the alternate prime minister for the opposition.
“I don’t feel offended."
"It’s hilarious really."
"I am sure when Biden was a child, those are the things he heard his parents say."
"And it probably stuck with him all his life.”
Maholopa Laveil, economics lecturer at the University of Papua New Guinea, said the claims were unhelpful, and pointed out that it comes after Biden cancelled a brief trip to the country last year.
“It paints PNG in a bad light."
"PNG has already had a lot of negative press around riots and tribal fighting and this doesn’t help, and [the claims are] unsubstantiated,” he said.
“For a US president to say that – particularly after a lot of deals have been struck with PNG and the work they’ve been doing in the Pacific – even off the cuff, I don’t think that should have been said at all,” said Maholopa.
According to the Pentagon’s Defense POW/MIA Accounting Agency, Biden’s uncle died on 14 May 1944, while a passenger on an A-20 havoc aircraft that departed Momote Airfield, Los Negros Island, bound for Nadzab airfield, New Guinea.
“For unknown reasons, this plane was forced to ditch in the ocean off the north coast of New Guinea,” the agency says.
“Both engines failed at low altitude, and the aircraft’s nose hit the water hard."
"Three men failed to emerge from the sinking wreck and were lost in the crash."
"One crew member survived and was rescued by a passing barge."
"An aerial search the next day found no trace of the missing aircraft or the lost crew members.”
https://www.theguardian.com/us-news/202 ... new-guinea
Re: POLITICS
FOX News
"White House defends Biden's claim his uncle was eaten by cannibals: 'We should not make jokes' - White House press secretary Karine Jean-Pierre takes jab at Donald Trump while defending Biden's 'cannibalism' comment"
By Stepheny Price Fox News
Published April 19, 2024
During his visit to a war memorial near his hometown in Pennsylvania, President Biden appeared to imply his uncle was eaten by cannibals after his plane was shot down during World War II.
"He flew single-engine planes, reconnaissance flights over New Guinea."
"He had volunteered because someone couldn't make it."
"He got shot down in an area where there were a lot of cannibals in New Guinea at the time," President Biden said.
"They never recovered his body."
On Thursday, White House press secretary Karine Jean-Pierre acknowledged that President Biden’s maternal uncle, Ambrose Finnegan, who he refers to as "Uncle Bosie," did die in WWII when his plane crashed into the Pacific Ocean, but confirmed he was not eaten by cannibals, as Biden seemed to suggest on two separate occasions during his visit on Wednesday.
When asked about his comments on Friday, White House press secretary Karine Jean-Pierre claimed the President was having an "emotional moment" when he made his remarks.
"The president had an emotional and I think a symbolic moment."
"He had an opportunity as president to honor his uncle's service in uniform."
"He had an opportunity to be there as president, you know, to speak to people that put their lives on the line on behalf of this country," Jean-Pierre said.
She went on to explain what Biden's comment meant.
"So his uncle, who lost his life when the military aircraft he was on crashed in the Pacific after taking off near New Guinea."
"The president highlighted his uncle's story as he made the case for honoring our sacred commitment to equip those we send to war and take care of them and their families when they come home," Jean-Pierre said.
"And as he reiterated, the last thing American veterans are or the last thing Americans should be called are suckers and losers."
"And those types of words should not come from a commander in chief, as we have in the past."
Jean-Pierre's last statement was in reference to former President Trump, who President Biden claimed called soldiers "suckers and losers."
Trump was alleged to have made the comments as he was set to visit the Aisne-Marne American Cemetery during a trip to France in Nov. 2018 while he was president.
The allegations, sourced anonymously in The Atlantic, described multiple offensive comments allegedly made by Trump toward fallen and captured U.S. service-members, including allegedly calling the World War I dead at an American military cemetery in France as "losers" and "suckers" in 2018.
"This is more made up Fake News given by disgusting & jealous failures in a disgraceful attempt to influence the 2020 Election!" Trump wrote in a post on Twitter about the comments made against him.
Former Secretary of State Mike Pompeo told "Fox & Friends" that he was with the president for a good part of the trip to France.
"I never heard him use the words that are described in that article," Pompeo said.
Former White House press secretary Sarah Sanders tweeted that she was part of the discussion about visiting the cemetery.
"This never happened."
"I have sat in the room when our President called family members after their sons were killed in action and it was heart-wrenching."
"... I am disgusted by this false attack."
Fox News' Peter Doocy continued to question Jean-Pierre about President Biden's comments about his uncle, acknowledging that Second Lieutenant Ambrose Jay Finnegan was a war hero, but stating that the Pentagon said, for unknown reasons, the plane was forced to ditch in the ocean.
"Both engines failed at low altitude."
"Why is President Biden saying he was shot down?"
"There's no evidence of that."
"And why is he saying that his uncle was eaten by cannibals?"
"That is a bad way to go," Doocy questioned.
"He lost his life."
"It's not."
"Look, I'm not, we should not make jokes about this," Jean-Pierre said.
Doocy reiterated that it wasn't a joke, but said again, that is what Biden said.
"I mean, your last line is, it's for a laugh, it's for a funny statement."
"And he takes this very seriously."
"His uncle, who served and protected this country, lost his life serving."
"And that should matter."
"You have a president that lifts our U.S. troops, our American veterans every day."
"Who thinks about them?"
"Who actually thinks they're all heroes?"
"And they are," Jean-Pierre sparred back.
Doocy asked one more time why he used the term "cannibalism" as Jean-Pierre gave her last comment.
"I think you're missing the point."
"The point is you have a president that lifts up American veterans, who lifts up our U.S. service members."
"And that's what matters."
"He understands how critical and how important it is to be commander in chief," Jean-Pierre finished.
The Associated Press contributed to this report.
https://www.foxnews.com/politics/white- ... make-jokes
"White House defends Biden's claim his uncle was eaten by cannibals: 'We should not make jokes' - White House press secretary Karine Jean-Pierre takes jab at Donald Trump while defending Biden's 'cannibalism' comment"
By Stepheny Price Fox News
Published April 19, 2024
During his visit to a war memorial near his hometown in Pennsylvania, President Biden appeared to imply his uncle was eaten by cannibals after his plane was shot down during World War II.
"He flew single-engine planes, reconnaissance flights over New Guinea."
"He had volunteered because someone couldn't make it."
"He got shot down in an area where there were a lot of cannibals in New Guinea at the time," President Biden said.
"They never recovered his body."
On Thursday, White House press secretary Karine Jean-Pierre acknowledged that President Biden’s maternal uncle, Ambrose Finnegan, who he refers to as "Uncle Bosie," did die in WWII when his plane crashed into the Pacific Ocean, but confirmed he was not eaten by cannibals, as Biden seemed to suggest on two separate occasions during his visit on Wednesday.
When asked about his comments on Friday, White House press secretary Karine Jean-Pierre claimed the President was having an "emotional moment" when he made his remarks.
"The president had an emotional and I think a symbolic moment."
"He had an opportunity as president to honor his uncle's service in uniform."
"He had an opportunity to be there as president, you know, to speak to people that put their lives on the line on behalf of this country," Jean-Pierre said.
She went on to explain what Biden's comment meant.
"So his uncle, who lost his life when the military aircraft he was on crashed in the Pacific after taking off near New Guinea."
"The president highlighted his uncle's story as he made the case for honoring our sacred commitment to equip those we send to war and take care of them and their families when they come home," Jean-Pierre said.
"And as he reiterated, the last thing American veterans are or the last thing Americans should be called are suckers and losers."
"And those types of words should not come from a commander in chief, as we have in the past."
Jean-Pierre's last statement was in reference to former President Trump, who President Biden claimed called soldiers "suckers and losers."
Trump was alleged to have made the comments as he was set to visit the Aisne-Marne American Cemetery during a trip to France in Nov. 2018 while he was president.
The allegations, sourced anonymously in The Atlantic, described multiple offensive comments allegedly made by Trump toward fallen and captured U.S. service-members, including allegedly calling the World War I dead at an American military cemetery in France as "losers" and "suckers" in 2018.
"This is more made up Fake News given by disgusting & jealous failures in a disgraceful attempt to influence the 2020 Election!" Trump wrote in a post on Twitter about the comments made against him.
Former Secretary of State Mike Pompeo told "Fox & Friends" that he was with the president for a good part of the trip to France.
"I never heard him use the words that are described in that article," Pompeo said.
Former White House press secretary Sarah Sanders tweeted that she was part of the discussion about visiting the cemetery.
"This never happened."
"I have sat in the room when our President called family members after their sons were killed in action and it was heart-wrenching."
"... I am disgusted by this false attack."
Fox News' Peter Doocy continued to question Jean-Pierre about President Biden's comments about his uncle, acknowledging that Second Lieutenant Ambrose Jay Finnegan was a war hero, but stating that the Pentagon said, for unknown reasons, the plane was forced to ditch in the ocean.
"Both engines failed at low altitude."
"Why is President Biden saying he was shot down?"
"There's no evidence of that."
"And why is he saying that his uncle was eaten by cannibals?"
"That is a bad way to go," Doocy questioned.
"He lost his life."
"It's not."
"Look, I'm not, we should not make jokes about this," Jean-Pierre said.
Doocy reiterated that it wasn't a joke, but said again, that is what Biden said.
"I mean, your last line is, it's for a laugh, it's for a funny statement."
"And he takes this very seriously."
"His uncle, who served and protected this country, lost his life serving."
"And that should matter."
"You have a president that lifts our U.S. troops, our American veterans every day."
"Who thinks about them?"
"Who actually thinks they're all heroes?"
"And they are," Jean-Pierre sparred back.
Doocy asked one more time why he used the term "cannibalism" as Jean-Pierre gave her last comment.
"I think you're missing the point."
"The point is you have a president that lifts up American veterans, who lifts up our U.S. service members."
"And that's what matters."
"He understands how critical and how important it is to be commander in chief," Jean-Pierre finished.
The Associated Press contributed to this report.
https://www.foxnews.com/politics/white- ... make-jokes
Re: POLITICS
REUTERS
"US consumers on lower incomes face loan stress while banks pull back"
By Nupur Anand
April 22, 2024
NEW YORK, April 22 (Reuters) - U.S. borrowers on lower incomes are increasingly struggling to keep up with their loan payments, according to recent data and bank executives, prompting banks to become more cautious about dishing out credit cards and car loans.
A growing number of Americans have seen their savings dwindle as rising prices squeeze budgets while interest rates stay high, bankers and economists said.
The deterioration in household finances for those earning less than $45,000 contrasts with financial resilience among those on higher incomes.
Austan Goolsbee, Chicago Federal Reserve Bank President, said on Friday that consumer delinquencies were one of the most concerning economic data points at the moment.
"If the delinquency rate of consumer loans starts rising, that is often a leading indicator things are about to get worse," he said.
First-time and low-income borrowers are experiencing higher default rates on their loans than people with larger incomes, said Arijit Roy, who runs the consumer business at U.S. Bancorp.
At Bank of America, net charge-offs, or debts that are unlikely to be recovered, rose to $1.5 billion in the first quarter from $807 million a year earlier, mainly from credit cards, the bank reported on Tuesday.
Rival JPMorgan Chase's said its charge-offs nearly doubled to $2 billion in the same quarter, while they also increased at Citigroup and Wells Fargo.
Bank of America is seeing "cracks" in the finances of borrowers with below-prime credit scores whose household spending is affected by higher interest rates and inflation, Chief Financial Officer Alastair Borthwick told analysts on an earnings call.
But its customers typically have higher credit scores, and their finances are holding up well, he added.
Capital One, Old National Bank, and First Mortgage Direct are among the banks who serve more subprime customers with credit scores in the roughly 300 to 600 range, according to BankRate.
The lenders did not immediately respond to a request seeking comment.
While lenders earn money from interest payments, they seek to avoid situations in which customers fall so far behind on loans that they have to be written off.
"Banks are trying to come up with early-warning signals for customers about their bill payments, offering debt counseling and educating the customers more so that they can stay on track," said Tom Dent, senior vice president at the Consumer Bankers Association, an industry group.
LENDING CAUTION
The burgeoning strains have prompted lenders to become more wary.
"During situations like these, many banks adopt a cautious outlook and begin to optimize their balance sheets by utilizing pricing strategies," Roy said.
Loan volumes declined, and credit standards tightened further as banks raised borrowing costs in March, according to a survey from Federal Reserve Bank of Dallas.
The poll focused on lenders headquartered in Dallas, Texas, but typically follows national trends.
Loan officers polled separately by the Federal Reserve also said they were tightening lending standards, including for credit cards and auto loans, according to a quarterly survey in January.
A significant number of banks expected standards for credit cards to become even tougher.
The pullback signals loan growth - a key source of income - will be muted for conservative lenders, executives said.
Meanwhile, recent economic data have bolstered expectations that the Fed will not cut interest rates until September.
The elevated borrowing costs could further exacerbate strains for stretched borrowers.
But banking giants said most consumers were in good shape.
JPMorgan CEO Jamie Dimon told analysts this month that Americans were still spending, although he noted those on lower incomes had largely used up their excess money.
"We are okay right now," Dimon said.
"It does not mean we're okay down the road."
DIVERGENT CONSUMERS
Credit cards were the most notable area of weakness, while defaults on buy-now, pay-later loans were also rising, said Mark Zandi, chief economist at Moody's Analytics.
"It is a tale of two consumers," he said.
"Back in the financial crisis, people were defaulting primarily on their mortgages but now it's credit cards that are unsecured and have the highest rate of interest."
Still, credit card and auto delinquency rates appear to be peaking, Moody's said in a report earlier this month.
U.S. household debt has surged to an all-time high, and Americans have been borrowing more on credit cards, with balances crossing the $1 trillion mark for the first time last year.
Pandemic stimulus programs had burnished finances for many people who got credit cards, said Brendan Coughlin, head of consumer banking at Citizens Financial.
But financial buffers have shrunk as Americans burned through stimulus payments and loan forbearance programs ended, leaving many consumers overextended.
"Credit scores were artificially inflated with increased savings and lower spending," said Coughlin.
Credit card delinquencies are a key indicator to watch because they are "a representation of people living beyond their means," he added.
Americans saved 3.6% of their disposable income in February, down from 4.7% a year earlier, according to U.S. Bureau of Economic Analysis data.
Overall consumer delinquencies stood at 0.98% in February across loan categories including credit cards, auto loans and mortgages, according to data from VantageScore, a credit score modeling company.
It highlighted that the figure has been rising over the last few months.
Consumers on low incomes, which it defines as less than $45,000 a year, had greater financial stresses, and the group of U.S. borrowers with the highest credit scores is shrinking, the data showed.
Younger Americans are also more likely to be delinquent than the over-40s, the data showed.
Reporting by Nupur Anand in New York, editing by Lananh Nguyen and Rosalba O'Brien
https://www.reuters.com/markets/us/us-c ... 024-04-22/
"US consumers on lower incomes face loan stress while banks pull back"
By Nupur Anand
April 22, 2024
NEW YORK, April 22 (Reuters) - U.S. borrowers on lower incomes are increasingly struggling to keep up with their loan payments, according to recent data and bank executives, prompting banks to become more cautious about dishing out credit cards and car loans.
A growing number of Americans have seen their savings dwindle as rising prices squeeze budgets while interest rates stay high, bankers and economists said.
The deterioration in household finances for those earning less than $45,000 contrasts with financial resilience among those on higher incomes.
Austan Goolsbee, Chicago Federal Reserve Bank President, said on Friday that consumer delinquencies were one of the most concerning economic data points at the moment.
"If the delinquency rate of consumer loans starts rising, that is often a leading indicator things are about to get worse," he said.
First-time and low-income borrowers are experiencing higher default rates on their loans than people with larger incomes, said Arijit Roy, who runs the consumer business at U.S. Bancorp.
At Bank of America, net charge-offs, or debts that are unlikely to be recovered, rose to $1.5 billion in the first quarter from $807 million a year earlier, mainly from credit cards, the bank reported on Tuesday.
Rival JPMorgan Chase's said its charge-offs nearly doubled to $2 billion in the same quarter, while they also increased at Citigroup and Wells Fargo.
Bank of America is seeing "cracks" in the finances of borrowers with below-prime credit scores whose household spending is affected by higher interest rates and inflation, Chief Financial Officer Alastair Borthwick told analysts on an earnings call.
But its customers typically have higher credit scores, and their finances are holding up well, he added.
Capital One, Old National Bank, and First Mortgage Direct are among the banks who serve more subprime customers with credit scores in the roughly 300 to 600 range, according to BankRate.
The lenders did not immediately respond to a request seeking comment.
While lenders earn money from interest payments, they seek to avoid situations in which customers fall so far behind on loans that they have to be written off.
"Banks are trying to come up with early-warning signals for customers about their bill payments, offering debt counseling and educating the customers more so that they can stay on track," said Tom Dent, senior vice president at the Consumer Bankers Association, an industry group.
LENDING CAUTION
The burgeoning strains have prompted lenders to become more wary.
"During situations like these, many banks adopt a cautious outlook and begin to optimize their balance sheets by utilizing pricing strategies," Roy said.
Loan volumes declined, and credit standards tightened further as banks raised borrowing costs in March, according to a survey from Federal Reserve Bank of Dallas.
The poll focused on lenders headquartered in Dallas, Texas, but typically follows national trends.
Loan officers polled separately by the Federal Reserve also said they were tightening lending standards, including for credit cards and auto loans, according to a quarterly survey in January.
A significant number of banks expected standards for credit cards to become even tougher.
The pullback signals loan growth - a key source of income - will be muted for conservative lenders, executives said.
Meanwhile, recent economic data have bolstered expectations that the Fed will not cut interest rates until September.
The elevated borrowing costs could further exacerbate strains for stretched borrowers.
But banking giants said most consumers were in good shape.
JPMorgan CEO Jamie Dimon told analysts this month that Americans were still spending, although he noted those on lower incomes had largely used up their excess money.
"We are okay right now," Dimon said.
"It does not mean we're okay down the road."
DIVERGENT CONSUMERS
Credit cards were the most notable area of weakness, while defaults on buy-now, pay-later loans were also rising, said Mark Zandi, chief economist at Moody's Analytics.
"It is a tale of two consumers," he said.
"Back in the financial crisis, people were defaulting primarily on their mortgages but now it's credit cards that are unsecured and have the highest rate of interest."
Still, credit card and auto delinquency rates appear to be peaking, Moody's said in a report earlier this month.
U.S. household debt has surged to an all-time high, and Americans have been borrowing more on credit cards, with balances crossing the $1 trillion mark for the first time last year.
Pandemic stimulus programs had burnished finances for many people who got credit cards, said Brendan Coughlin, head of consumer banking at Citizens Financial.
But financial buffers have shrunk as Americans burned through stimulus payments and loan forbearance programs ended, leaving many consumers overextended.
"Credit scores were artificially inflated with increased savings and lower spending," said Coughlin.
Credit card delinquencies are a key indicator to watch because they are "a representation of people living beyond their means," he added.
Americans saved 3.6% of their disposable income in February, down from 4.7% a year earlier, according to U.S. Bureau of Economic Analysis data.
Overall consumer delinquencies stood at 0.98% in February across loan categories including credit cards, auto loans and mortgages, according to data from VantageScore, a credit score modeling company.
It highlighted that the figure has been rising over the last few months.
Consumers on low incomes, which it defines as less than $45,000 a year, had greater financial stresses, and the group of U.S. borrowers with the highest credit scores is shrinking, the data showed.
Younger Americans are also more likely to be delinquent than the over-40s, the data showed.
Reporting by Nupur Anand in New York, editing by Lananh Nguyen and Rosalba O'Brien
https://www.reuters.com/markets/us/us-c ... 024-04-22/
Re: POLITICS
REUTERS
"US commerce secretary downplays chip in advanced Huawei phone"
By Reuters
April 22, 2024
WASHINGTON, April 21 (Reuters) - The chip powering the Mate 60 Pro phone of sanctioned Chinese company Huawei is not as advanced as American chips, U.S. Commerce Secretary Gina Raimondo said on Sunday, arguing that it shows U.S. curbs on shipments to the telecoms equipment giant are working.
Huawei, which has been on a trade restriction list since 2019, surprised the industry and the U.S. government when it released a new phone powered by a sophisticated chip last August.
The Huawei Mate 60 Pro was seen as a symbol of China's technological resurgence despite Washington's ongoing efforts to cripple its capacity to produce advanced semiconductors.
It was also seen by many as a slight for Raimondo, who was visiting China when it was released.
But in an interview with CBS News' "60 Minutes," Raimondo pushed back against that view.
"What it tells me is the export controls are working because that chip is not nearly as good, ... it's years behind what we have in the United States," she said.
"We have the most sophisticated semiconductors in the world."
"China doesn't."
Washington has been locked in a years-long effort to deprive Beijing of advanced semiconductor chips and the tools needed to make them over concerns they would be used to strengthen China's military capabilities.
Huawei, a symbol of that tech war, was added to the so-called entity-list in 2019 amid fears it could spy on Americans, forcing its U.S. suppliers to seek a difficult-to-obtain license to ship to it.
But its suppliers, including Intel, have received licenses worth billions of dollars to keep selling to the company.
Huawei's revelation of its first AI-enabled laptop powered by an Intel chip this month has fueled anger among Republican China hardliners.
When asked if she was tough enough on big business, Raimondo was emphatic.
"I hold businesses accountable as much as anyone," she told Lesley Stahl on "60 Minutes."
"When I tell them they can’t sell their semiconductors to China, they don’t love that, but I do that," she added.
The Huawei phone also prompted a review by the Biden administration to learn the details behind the chip that powers it, the most advanced semiconductor China has so far produced.
But details of the review have been scant.
Reporting by Alexandra Alper; Editing by Leslie Adler
https://www.reuters.com/technology/us-c ... 024-04-21/
"US commerce secretary downplays chip in advanced Huawei phone"
By Reuters
April 22, 2024
WASHINGTON, April 21 (Reuters) - The chip powering the Mate 60 Pro phone of sanctioned Chinese company Huawei is not as advanced as American chips, U.S. Commerce Secretary Gina Raimondo said on Sunday, arguing that it shows U.S. curbs on shipments to the telecoms equipment giant are working.
Huawei, which has been on a trade restriction list since 2019, surprised the industry and the U.S. government when it released a new phone powered by a sophisticated chip last August.
The Huawei Mate 60 Pro was seen as a symbol of China's technological resurgence despite Washington's ongoing efforts to cripple its capacity to produce advanced semiconductors.
It was also seen by many as a slight for Raimondo, who was visiting China when it was released.
But in an interview with CBS News' "60 Minutes," Raimondo pushed back against that view.
"What it tells me is the export controls are working because that chip is not nearly as good, ... it's years behind what we have in the United States," she said.
"We have the most sophisticated semiconductors in the world."
"China doesn't."
Washington has been locked in a years-long effort to deprive Beijing of advanced semiconductor chips and the tools needed to make them over concerns they would be used to strengthen China's military capabilities.
Huawei, a symbol of that tech war, was added to the so-called entity-list in 2019 amid fears it could spy on Americans, forcing its U.S. suppliers to seek a difficult-to-obtain license to ship to it.
But its suppliers, including Intel, have received licenses worth billions of dollars to keep selling to the company.
Huawei's revelation of its first AI-enabled laptop powered by an Intel chip this month has fueled anger among Republican China hardliners.
When asked if she was tough enough on big business, Raimondo was emphatic.
"I hold businesses accountable as much as anyone," she told Lesley Stahl on "60 Minutes."
"When I tell them they can’t sell their semiconductors to China, they don’t love that, but I do that," she added.
The Huawei phone also prompted a review by the Biden administration to learn the details behind the chip that powers it, the most advanced semiconductor China has so far produced.
But details of the review have been scant.
Reporting by Alexandra Alper; Editing by Leslie Adler
https://www.reuters.com/technology/us-c ... 024-04-21/
Re: POLITICS
Bloomberg
"US-Led Military Base in Syria Hit by Rockets Fired From Iraq"
Story by Sherif Tarek
22 APRIL 2024
(Bloomberg) -- A military base in Syria belonging to a US-led coalition came under rocket-fire late on Sunday, the government-affiliated Iraqi Security Media Cell said in a statement.
At least one rocket landed at the base, said Rami Abdulrahman, director of the Syrian Observatory for Human Rights in an interview with Al-Arabiya.
It wasn’t immediately clear if there were any casualties.
US Central Command, which oversees American forces in the Middle East, is yet to comment.
The attacks are the first against US bases in the region since early February, when Washington struck Iran-backed militias in Iraq and Syria.
That was in response for a drone assault that killed three American soldiers in Jordan and was blamed by the US on an umbrella group called the Islamic Resistance in Iraq.
Iran backs a number of anti-US and anti-Israel militias in Iraq and Syria and they ramped up attacks on American bases after the Israel-Hamas war began in October.
Iraqi forces are conducting a search operation west of Nineveh, near the Syrian border, to try to capture the perpetrators of the latest attack, according to Iraqi Security Media Cell.
The Islamic Resistance in Iraq didn’t explicitly claim responsibility for the strike, but in a statement on Telegram the militant group said it decided to resume military operations against American troops after Iraqi Prime Minister Mohammed Shia Al-Sudani visited the White House and met President Joe Biden this month.
The group gave Al-Sudani three months to negotiate the departure of the roughly 2,000 US forces in Iraq.
“What happened a short while ago is the beginning that must be escalated,” according to the group’s statement.
The attack followed an explosion on a base in Iraq this weekend controlled by the Popular Mobilization Forces, a coalition of Iran-allied militias, killing one person and injuring eight, the Associated Press reported.
The US said it wasn’t behind that incident.
--With assistance from Kateryna Kadabashy.
https://www.msn.com/en-us/news/world/us ... acfc&ei=49
"US-Led Military Base in Syria Hit by Rockets Fired From Iraq"
Story by Sherif Tarek
22 APRIL 2024
(Bloomberg) -- A military base in Syria belonging to a US-led coalition came under rocket-fire late on Sunday, the government-affiliated Iraqi Security Media Cell said in a statement.
At least one rocket landed at the base, said Rami Abdulrahman, director of the Syrian Observatory for Human Rights in an interview with Al-Arabiya.
It wasn’t immediately clear if there were any casualties.
US Central Command, which oversees American forces in the Middle East, is yet to comment.
The attacks are the first against US bases in the region since early February, when Washington struck Iran-backed militias in Iraq and Syria.
That was in response for a drone assault that killed three American soldiers in Jordan and was blamed by the US on an umbrella group called the Islamic Resistance in Iraq.
Iran backs a number of anti-US and anti-Israel militias in Iraq and Syria and they ramped up attacks on American bases after the Israel-Hamas war began in October.
Iraqi forces are conducting a search operation west of Nineveh, near the Syrian border, to try to capture the perpetrators of the latest attack, according to Iraqi Security Media Cell.
The Islamic Resistance in Iraq didn’t explicitly claim responsibility for the strike, but in a statement on Telegram the militant group said it decided to resume military operations against American troops after Iraqi Prime Minister Mohammed Shia Al-Sudani visited the White House and met President Joe Biden this month.
The group gave Al-Sudani three months to negotiate the departure of the roughly 2,000 US forces in Iraq.
“What happened a short while ago is the beginning that must be escalated,” according to the group’s statement.
The attack followed an explosion on a base in Iraq this weekend controlled by the Popular Mobilization Forces, a coalition of Iran-allied militias, killing one person and injuring eight, the Associated Press reported.
The US said it wasn’t behind that incident.
--With assistance from Kateryna Kadabashy.
https://www.msn.com/en-us/news/world/us ... acfc&ei=49
Re: POLITICS
Mirror
"US military base in Syria under missile and drone attack with fears of casualties"
Story by Sean McPolin
22 APRIL 2024
At least five rockets have been launched from Iraq towards a US Base in Syria, with explosions heard in the area and fears of casualties.
Sources in the area have described how explosions were heard in the vicinity of the American military base in Al-Omar field, which is east of Deir Ezzor.
It comes after tension last week between Iran and Israel which saw the former send a "retaliation" attack of drones and missiles late at night.
Sama TV journalist Mohammed Dabaa took to X, formerly Twitter, to say: "Local sources confirm that there were direct casualties in the vehicle hangars within the American occupation base in Kharab al-Jir, after they were targeted by 5 projectiles, including missiles and a drone, amid an American security alert in the base and its surroundings."
It's also believed a second missile attack has occurred in Deir Ez-Sor, with the Syrian Democratic Forces, near the Al-Omar oil field in Khadra, East Deir Ez-Zor, being the main target.
Footage has been circulated on Telegram of the attack targeting the Kharab al-Jir base in the Hasakah countryside from the Iraqi territory.
It is the first attack against US forces since February when troops were being attacked by Iranian-backed groups in Iraq.
It comes on the day Iraqi Prime Minister Mohammed Shia al-Sudani returned from the United States where he met President Joe Biden at the White House, the Sun reports.
Security sources evaluating the situation have detailed how a rocket launched was found on the back of a small truck and parked up in Zummar, a town which borders Syria.
The military official said the truck caught fire with an explosion from unfired rockets at the same time missiles and drones were sent into the sky.
Following this an Iraqi Security Media Cell confirmed a car where "several missiles were launched from" had been found.
An attack comes days after a military base in Iraq, which was holding a pro-Iranian militia, was damaged in an explosion and killed one person and wounded eight others.
Iraq's military reported no drones or fighter jets in the area before or during the blast.
However, the militia organization involved, the Popular Mobilisation Forces (PMF), was blamed for the attack which came after heightened tensions between Israel and Iran.
The PMF is an umbrella organization that contains several militias which are part of the network of proxies that Tehran has been able to use to advance its interests across the Middle East for years.
https://www.msn.com/en-us/news/world/us ... 7382&ei=39
"US military base in Syria under missile and drone attack with fears of casualties"
Story by Sean McPolin
22 APRIL 2024
At least five rockets have been launched from Iraq towards a US Base in Syria, with explosions heard in the area and fears of casualties.
Sources in the area have described how explosions were heard in the vicinity of the American military base in Al-Omar field, which is east of Deir Ezzor.
It comes after tension last week between Iran and Israel which saw the former send a "retaliation" attack of drones and missiles late at night.
Sama TV journalist Mohammed Dabaa took to X, formerly Twitter, to say: "Local sources confirm that there were direct casualties in the vehicle hangars within the American occupation base in Kharab al-Jir, after they were targeted by 5 projectiles, including missiles and a drone, amid an American security alert in the base and its surroundings."
It's also believed a second missile attack has occurred in Deir Ez-Sor, with the Syrian Democratic Forces, near the Al-Omar oil field in Khadra, East Deir Ez-Zor, being the main target.
Footage has been circulated on Telegram of the attack targeting the Kharab al-Jir base in the Hasakah countryside from the Iraqi territory.
It is the first attack against US forces since February when troops were being attacked by Iranian-backed groups in Iraq.
It comes on the day Iraqi Prime Minister Mohammed Shia al-Sudani returned from the United States where he met President Joe Biden at the White House, the Sun reports.
Security sources evaluating the situation have detailed how a rocket launched was found on the back of a small truck and parked up in Zummar, a town which borders Syria.
The military official said the truck caught fire with an explosion from unfired rockets at the same time missiles and drones were sent into the sky.
Following this an Iraqi Security Media Cell confirmed a car where "several missiles were launched from" had been found.
An attack comes days after a military base in Iraq, which was holding a pro-Iranian militia, was damaged in an explosion and killed one person and wounded eight others.
Iraq's military reported no drones or fighter jets in the area before or during the blast.
However, the militia organization involved, the Popular Mobilisation Forces (PMF), was blamed for the attack which came after heightened tensions between Israel and Iran.
The PMF is an umbrella organization that contains several militias which are part of the network of proxies that Tehran has been able to use to advance its interests across the Middle East for years.
https://www.msn.com/en-us/news/world/us ... 7382&ei=39
Re: POLITICS
REUTERS
"US business activity cools in April; inflation measures mixed"
By Reuters
April 23, 2024
April 23 (Reuters) - U.S. business activity cooled in April to a four-month low due to weaker demand, while rates of inflation eased slightly even as input prices rose sharply, suggesting some possible relief ahead as the Federal Reserve looks for signs that the economy is ebbing enough to bring inflation down further.
S&P Global said on Tuesday that its flash U.S. Composite PMI Output Index, which tracks the manufacturing and services sectors, fell to 50.9 this month from 52.1 in March.
A reading above 50 indicates expansion in the private sector.
The slowdown reflected weaker rates of growth in both the manufacturing and services sectors, with activity easing to three- and five-month lows, respectively.
That in turn meant employment, which the Fed is watching closely for indications of a drop off, fell for the first time since June 2020, with the reduction focused on services.
The survey suggested that the economy lost momentum at the beginning of the second quarter compared to the January-March quarter.
According to a Reuters survey of economists, GDP likely increased at a 2.4% annualized rate last quarter.
The United States continues to outperform its global peers, despite 525 basis points worth of interest rate hikes from the Federal Reserve since March 2022 to tame inflation.
The Fed has recently been spooked by a string of stronger-than-expected inflation and employment readings, which suggested its fight to bring inflation back down to the central bank's 2% target rate has stalled or even reversed.
The Fed meets next week and is expected to leave its policy rate unchanged in the current 5.25%-5.50% range.
Last week, a chorus of Fed officials backed away from signaling at least one rate cut this year, instead saying only that recent data meant monetary policy needs to be restrictive for longer.
The S&P Global survey's measure of new orders received by private businesses dropped to 48.4 from 51.7 in March, the first decline in six months, while its measure of prices paid for inputs declined to 56.5, off the six-month high of 58.7 reached in March but still a solid rate.
The output prices gauge fell to 54.1, off the ten-month high of 56.4 recorded in March, but also still elevated.
In a reversal of trends seen last year when wage-related services sector price pressures intensified while manufacturing input costs cooled, higher raw material and fuel prices resulted in the fastest rise in manufacturing input costs in a year in April, with manufacturing now recording steeper inflation increases in three of the past four months.
Service providers, by contrast, reported the second-lowest overall cost increase in three and half years.
"The deterioration of demand and cooling of the labor market fed through to lower price pressures, as April saw a welcome easing in rates of increase for selling prices for both goods and services," said Chris Williamson, chief business economist at S&P Global Market Intelligence.
"Firms' future output expectations slipped to a five-month low amid heightened concern about the outlook."
Manufacturing entered contraction territory, with the survey's flash manufacturing PMI slipping to 49.9 this month from 51.9 in March.
New orders shrank slightly while growth in employment slowed, albeit modestly, and supply chains showed signs of spare capacity.
The survey's flash services sector PMI dipped to 50.9 in April from 51.7 in the prior month.
Reporting by Lindsay Dunsmuir; Editing by Chizu Nomiyama
https://www.reuters.com/markets/us/us-b ... 024-04-23/
"US business activity cools in April; inflation measures mixed"
By Reuters
April 23, 2024
April 23 (Reuters) - U.S. business activity cooled in April to a four-month low due to weaker demand, while rates of inflation eased slightly even as input prices rose sharply, suggesting some possible relief ahead as the Federal Reserve looks for signs that the economy is ebbing enough to bring inflation down further.
S&P Global said on Tuesday that its flash U.S. Composite PMI Output Index, which tracks the manufacturing and services sectors, fell to 50.9 this month from 52.1 in March.
A reading above 50 indicates expansion in the private sector.
The slowdown reflected weaker rates of growth in both the manufacturing and services sectors, with activity easing to three- and five-month lows, respectively.
That in turn meant employment, which the Fed is watching closely for indications of a drop off, fell for the first time since June 2020, with the reduction focused on services.
The survey suggested that the economy lost momentum at the beginning of the second quarter compared to the January-March quarter.
According to a Reuters survey of economists, GDP likely increased at a 2.4% annualized rate last quarter.
The United States continues to outperform its global peers, despite 525 basis points worth of interest rate hikes from the Federal Reserve since March 2022 to tame inflation.
The Fed has recently been spooked by a string of stronger-than-expected inflation and employment readings, which suggested its fight to bring inflation back down to the central bank's 2% target rate has stalled or even reversed.
The Fed meets next week and is expected to leave its policy rate unchanged in the current 5.25%-5.50% range.
Last week, a chorus of Fed officials backed away from signaling at least one rate cut this year, instead saying only that recent data meant monetary policy needs to be restrictive for longer.
The S&P Global survey's measure of new orders received by private businesses dropped to 48.4 from 51.7 in March, the first decline in six months, while its measure of prices paid for inputs declined to 56.5, off the six-month high of 58.7 reached in March but still a solid rate.
The output prices gauge fell to 54.1, off the ten-month high of 56.4 recorded in March, but also still elevated.
In a reversal of trends seen last year when wage-related services sector price pressures intensified while manufacturing input costs cooled, higher raw material and fuel prices resulted in the fastest rise in manufacturing input costs in a year in April, with manufacturing now recording steeper inflation increases in three of the past four months.
Service providers, by contrast, reported the second-lowest overall cost increase in three and half years.
"The deterioration of demand and cooling of the labor market fed through to lower price pressures, as April saw a welcome easing in rates of increase for selling prices for both goods and services," said Chris Williamson, chief business economist at S&P Global Market Intelligence.
"Firms' future output expectations slipped to a five-month low amid heightened concern about the outlook."
Manufacturing entered contraction territory, with the survey's flash manufacturing PMI slipping to 49.9 this month from 51.9 in March.
New orders shrank slightly while growth in employment slowed, albeit modestly, and supply chains showed signs of spare capacity.
The survey's flash services sector PMI dipped to 50.9 in April from 51.7 in the prior month.
Reporting by Lindsay Dunsmuir; Editing by Chizu Nomiyama
https://www.reuters.com/markets/us/us-b ... 024-04-23/
Re: POLITICS
REUTERS
"US new home sales rebound to six-month high; rising mortgage rates a concern"
By Lucia Mutikani
April 23, 2024
Summary
* New home sales increase 8.8% in March
* Median house price falls 1.9% to $430,700 from year ago
WASHINGTON, April 23 (Reuters) - Sales of new U.S. single-family homes rebounded in March from February's downwardly revised level, drawing support from a persistent shortage of previously owned houses on the market, but momentum could be curbed by a resurgence in mortgage rates.
The report from the Commerce Department on Tuesday also showed the median house price jumped to a seven month-high from February, likely as fewer builders offered price cuts and sales shifted to higher priced homes.
Rising prices and mortgage rates could make housing even more unaffordable, especially for first-time buyers.
"New home sales have remained remarkably strong recently," said Oliver Allen, senior U.S. economist at Pantheon Macroeconomics.
"That said, the renewed rise in mortgage rates and dip in mortgage applications over the past couple of months means that new home sales will probably tread water at best in the near-term, while existing home sales will fall."
New home sales jumped 8.8% to a seasonally adjusted annual rate of 693,000 units last month, the highest level since September, the Commerce Department's Census Bureau said.
The sales pace for February was revised down to 637,000 units from the previously reported 662,000 units.
Economists polled by Reuters had forecast new home sales, which account for about 14% of U.S. home sales, would advance by a rate of 670,000 units.
New home sales are counted at the signing of a contract, making them a leading indicator of the housing market.
They, however, can be volatile on a month-to-month basis.
Sales increased 8.3% on a year-on-year basis in March.
Though the new housing market remains underpinned by the dearth of previously owned homes for sale, rising mortgage rates are taking a toll on affordability.
Data last week showed single-family housing starts and building permits declined in March.
Sentiment among single-family homebuilders was unchanged in April, with the National Association of Home Builders noting that "buyers are hesitating until they can better gauge where interest rates are headed."
The average rate on the popular 30-year fixed-rate mortgage has risen back above 7%, data from mortgage finance agency Freddie Mac showed, as strong reports on the labor market and inflation suggested the Federal Reserve could delay an anticipated interest rate cut this year.
A few economists doubt the U.S. central bank will lower borrowing costs in 2024.
BROAD INCREASE
New home sales rose in all four regions last month, with the Northeast posting a 27.8% surge.
Sales in the Midwest gained 5.3% and increased 7.7% in the densely populated South.
They vaulted 8.6% in the West.
Despite the weakness in permits last month, economists believed residential investment picked up in the first quarter after slowing considerably in the October-December period.
The government is scheduled to publish its snapshot of gross domestic product for the first quarter on Thursday.
Growth estimates for the period are as high as a 3.1% annualized rate.
The economy grew at a 3.4% pace in the fourth quarter.
Stocks on Wall Street were trading higher.
The dollar fell against a basket of currencies.
U.S. Treasury prices rose.
The median new house price increased 6% to $430,700 from February.
That was the highest level since last August.
Prices, however, slipped 1.9% from a year ago.
Most of the new homes sold last month were in the $300,000-$399,999 price range, followed by the $500,000-$749,000 price bracket.
Builders are constructing smaller and cheaper houses, but fewer of them are cutting prices.
The NAHB survey last week showed the share of builders cutting prices fell to 22% in April from 24% in March and 36% in December.
Fewer builders were also offering incentives to boost sales.
Overall house prices continue to rise because of the supply squeeze in the home resale market.
Data from mortgage finance agency Fannie Mae last week showed house prices increased 7.4% on a year-on-year basis in the first quarter compared to a 6.6% rise in the fourth quarter.
Fannie Mae upgraded its estimate for home price growth this year to 4.8% from 3.2% previously.
There were 477,000 new homes on the market at the end of March, up from 465,000 units in February.
At March's sales pace it would take 8.3 months to clear the supply of houses on the market, down from 8.8 months in February.
Houses under construction accounted for 59.1% of inventory.
Homes yet to be built made up 22.2% of supply, while completed houses accounted for 18.7%.
Reporting by Lucia Mutikani; Editing by Chizu Nomiyama and Paul Simao
https://www.reuters.com/markets/us/us-n ... 024-04-23/
"US new home sales rebound to six-month high; rising mortgage rates a concern"
By Lucia Mutikani
April 23, 2024
Summary
* New home sales increase 8.8% in March
* Median house price falls 1.9% to $430,700 from year ago
WASHINGTON, April 23 (Reuters) - Sales of new U.S. single-family homes rebounded in March from February's downwardly revised level, drawing support from a persistent shortage of previously owned houses on the market, but momentum could be curbed by a resurgence in mortgage rates.
The report from the Commerce Department on Tuesday also showed the median house price jumped to a seven month-high from February, likely as fewer builders offered price cuts and sales shifted to higher priced homes.
Rising prices and mortgage rates could make housing even more unaffordable, especially for first-time buyers.
"New home sales have remained remarkably strong recently," said Oliver Allen, senior U.S. economist at Pantheon Macroeconomics.
"That said, the renewed rise in mortgage rates and dip in mortgage applications over the past couple of months means that new home sales will probably tread water at best in the near-term, while existing home sales will fall."
New home sales jumped 8.8% to a seasonally adjusted annual rate of 693,000 units last month, the highest level since September, the Commerce Department's Census Bureau said.
The sales pace for February was revised down to 637,000 units from the previously reported 662,000 units.
Economists polled by Reuters had forecast new home sales, which account for about 14% of U.S. home sales, would advance by a rate of 670,000 units.
New home sales are counted at the signing of a contract, making them a leading indicator of the housing market.
They, however, can be volatile on a month-to-month basis.
Sales increased 8.3% on a year-on-year basis in March.
Though the new housing market remains underpinned by the dearth of previously owned homes for sale, rising mortgage rates are taking a toll on affordability.
Data last week showed single-family housing starts and building permits declined in March.
Sentiment among single-family homebuilders was unchanged in April, with the National Association of Home Builders noting that "buyers are hesitating until they can better gauge where interest rates are headed."
The average rate on the popular 30-year fixed-rate mortgage has risen back above 7%, data from mortgage finance agency Freddie Mac showed, as strong reports on the labor market and inflation suggested the Federal Reserve could delay an anticipated interest rate cut this year.
A few economists doubt the U.S. central bank will lower borrowing costs in 2024.
BROAD INCREASE
New home sales rose in all four regions last month, with the Northeast posting a 27.8% surge.
Sales in the Midwest gained 5.3% and increased 7.7% in the densely populated South.
They vaulted 8.6% in the West.
Despite the weakness in permits last month, economists believed residential investment picked up in the first quarter after slowing considerably in the October-December period.
The government is scheduled to publish its snapshot of gross domestic product for the first quarter on Thursday.
Growth estimates for the period are as high as a 3.1% annualized rate.
The economy grew at a 3.4% pace in the fourth quarter.
Stocks on Wall Street were trading higher.
The dollar fell against a basket of currencies.
U.S. Treasury prices rose.
The median new house price increased 6% to $430,700 from February.
That was the highest level since last August.
Prices, however, slipped 1.9% from a year ago.
Most of the new homes sold last month were in the $300,000-$399,999 price range, followed by the $500,000-$749,000 price bracket.
Builders are constructing smaller and cheaper houses, but fewer of them are cutting prices.
The NAHB survey last week showed the share of builders cutting prices fell to 22% in April from 24% in March and 36% in December.
Fewer builders were also offering incentives to boost sales.
Overall house prices continue to rise because of the supply squeeze in the home resale market.
Data from mortgage finance agency Fannie Mae last week showed house prices increased 7.4% on a year-on-year basis in the first quarter compared to a 6.6% rise in the fourth quarter.
Fannie Mae upgraded its estimate for home price growth this year to 4.8% from 3.2% previously.
There were 477,000 new homes on the market at the end of March, up from 465,000 units in February.
At March's sales pace it would take 8.3 months to clear the supply of houses on the market, down from 8.8 months in February.
Houses under construction accounted for 59.1% of inventory.
Homes yet to be built made up 22.2% of supply, while completed houses accounted for 18.7%.
Reporting by Lucia Mutikani; Editing by Chizu Nomiyama and Paul Simao
https://www.reuters.com/markets/us/us-n ... 024-04-23/