Monday, November 21, 2022

Environmental groups oppose pipeline expansion in Pacific NW


 In this Nov. 6, 2015 file photo, TC Energy's Keystone pipeline facility is seen in Hardisty, Alberta. The U.S. government took a step toward approving expanding the capacity of a natural gas pipeline in the Pacific Northwest — a move opposed by environmentalists and the attorneys general of Oregon, California and Washington state. The Federal Energy Regulatory Commission, or FERC, announced Friday, Nov. 18, 2022 that it has completed an environmental impact statement that concluded the project "would result in limited adverse impacts on the environment.”
 (Jeff McIntosh/The Canadian Press via AP, File)

SALEM, Ore. (AP) — The U.S. government has taken a step toward approving the expansion of a natural gas pipeline in the Pacific Northwest — a move opposed by environmentalists and the attorneys general of Oregon, California and Washington state.

The Federal Energy Regulatory Commission, or FERC, announced Friday it has completed an environmental impact statement that concluded the project "would result in limited adverse impacts on the environment.”

“Most adverse environmental impacts would be temporary or short-term,” the federal agency said.

A grassroots coalition of environmental groups said the analysis conflicts with climate goals of Pacific Northwest states and fails "to address upstream methane emissions from the harmful practice of fracking.”

The Gas Transmission Northwest pipeline belongs to TC Energy of Calgary, Canada - the same company behind the now-abandoned Keystone XL crude oil pipeline.

Gas Transmission Northwest proposes to modify three existing compressor stations along the pipeline — in Kootenai County, Idaho; Walla Walla County, Washington; and Sherman County, Oregon — to boost capacity by about 150 million cubic feet per day of natural gas. The company says the project is necessary to meet consumer demand.

The 1,377-mile (2,216-kilomter) pipeline runs from the Canadian border, through a corner of Idaho, and into Washington state and Oregon, connecting with a pipeline going into California.

In August, the attorneys general of Oregon, Washington state and California asked the FERC to deny the proposal, saying the expansion is expected to result in more than 3.24 million metric tons of greenhouse gas emissions per year, including methane and carbon dioxide.

“This project undermines Washington state’s efforts to fight climate change,” Washington state Attorney General Ferguson said back then. “This pipeline is bad for the environment and bad for consumers.”

The grassroots coalition said the federal study didn’t adequately address harmful impacts on the climate caused by the project, including by fracking to obtain the natural gas. The energy industry uses the technique to extract oil and gas from rock by injecting high-pressure mixtures of water, sand or gravel and chemicals. But the technique increases emissions of methane, an extraordinarily potent greenhouse gas.

“FERC’s approach will worsen the climate crisis, downplaying the impacts of a proposal that will pollute our communities, impact health and safety, and create millions of tons of climate-changing pollution each year,” said Lauren Goldberg, executive director of Columbia Riverkeeper, an environmental group based in Hood River, Oregon.

The regulatory commission’s study noted that its staff was unable to assess the project’s contribution to greenhouse gases “through any objective analysis.”

“Climate change is a global concern,” the federal study said. “However, for this analysis, we will focus on the existing and potential cumulative climate change impacts in the project area.”

TC Energy said Saturday that it is reviewing the environmental impact statement, which recommended a few mitigation measures.

The company has “secured long-term agreements with customers for 100% of the project capacity,” TC Energy said in an email. “This further demonstrates the need for secure energy to supplement renewables as we work toward a cleaner energy future.”

FERC is expected to make its final decision on the proposal on Feb. 16, the environmental coalition said.

APEC
VP Harris meets with China's Xi in bid to 'keep lines open'

Thailand APEC
U.S. Vice President Kamala Harris, left, meets with Thailand's Prime Minister Prayuth Chan-ocha at the Government House, Saturday, Nov. 19, 2022, in Bangkok, Thailand. 

(Haiyun Jiang/The New York Times via AP, Pool)More
BANGKOK (AP) — U.S. Vice President Kamala Harris spoke briefly with Chinese leader Xi Jinping on Saturday in another step toward keeping lines of communication open between the two biggest economies.

Harris and Xi exchanged remarks Saturday while heading into a closed-door meeting at the Asia-Pacific Economic Cooperation forum’s summit in Bangkok.

“I greeted President Xi before the APEC Leaders Retreat,” Harris wrote on Twitter. “I noted a key message that President Biden emphasized in his November 14 meeting with President Xi: we must maintain open lines of communication to responsibly manage the competition between our countries.”

Their exchange closely echoed Biden’s comment to Xi at an meeting between the two leaders earlier in the week about China and the U.S. keeping lines of communication open.

A brief statement from China's Foreign Ministry also referenced the Biden-Xi meeting at the Group of 20 summit in Bali, Indonesia, which it described as “strategic and constructive” with “major significance in guiding the next stage of China-US relations." It said it hoped the vice president will play an active role in working with China to promote the two nations' relations “to return to a healthy and stable track."

Relations between Washington and Beijing have suffered frictions over trade and technology, China's claims to the separately governed island of Taiwan, the pandemic and China's handling of Hong Kong, human rights and other issues.

Harris later took part in a handover ceremony in which Thai Prime Minister Prayuth Chan-ocha handed over chairmanship of APEC to the United States, which will host the group's meetings next year.

She told the leaders present for the ceremony that the United States would continue to focus APEC on sustainable economic growth, building on the strong foundation Thailand set this year with new ambitious sustainability goals.

She also touted her home state, California, saying “there is no better place to host APEC 2023 than California, a state known for economic innovation.”

“Our host year will demonstrate the enduring economic commitment of the United States to the Indo-Pacific,” said Harris.

“As I have made clear throughout my time in Bangkok: under our administration, the United States is a strong partner for the economies and companies of the Indo-Pacific, and we are working to strengthen our economic relationships throughout the region, including by increasing two-way trade flows and the free flow of capital, which supports millions of American jobs.”

On Friday, Harris pitched the U.S. as a reliable economic partner, telling a business conference on APEC’s sidelines, “The United States is here to stay.”

Harris told leaders at the APEC summit that the U.S. is a “proud Pacific power” and has a “vital interest in promoting a region that is open, interconnected, prosperous, secure and resilient.”

After receiving news that North Korea had fired an intercontinental ballistic missile that landed near Japanese waters, Harris convened an emergency meeting of the leaders of Japan, South Korea, Australia, New Zealand and Canada in which she slammed the missile test as a “brazen violation of multiple U.N. Security resolutions.”

"It destabilizes security in the region and unnecessarily raises tensions,” she said.

“We strongly condemn these actions and again call on North Korea to stop further unlawful, destabilizing acts," Harris said. "On behalf of the United States I reaffirmed our ironclad commitment to our Indo-Pacific alliances.”

Her remarks at the broader APEC forum capped a week of high-level outreach from the U.S. to Asia as Washington seeks to counter growing Chinese influence in the region, with President Joe Biden pushing the message of American commitment to the region at the Association of Southeast Asian Nations summit in Cambodia and the G-20 meeting in Indonesia.

Many Asian countries began questioning the American commitment to Asia after former President Donald Trump pulled the U.S. out of the Trans-Pacific Partnership trade deal, which had been the centerpiece of former President Barack Obama's “pivot” to Asia.

The Biden administration has been seeking to regain trust and take advantage of growing questions over strings attached to Chinese regional infrastructure investments that critics have dubbed Beijing's “debt trap” diplomacy.

Biden and Harris have also highlighted Washington’s Indo-Pacific Economic Framework, launched earlier this year.

After the APEC meeting, Harris also met with with Thai Prime Minister Prayuth Chan-ocha. Details of their talk were not immediately available, but had been expected to cover global and regional issues, such as the war in Ukraine and the crisis in Thailand's neighbor Myanmar, where a military takeover last year triggered what amounts to a civil war and a humanitarian crisis.

In addition to economic issues, the two were expected to talk about the close and long-term security alliance between Thailand and the United States.

Earlier, Harris announced a spree of initiatives to extend bilateral cooperation on climate change and economic growth, as well as to tackle drug trafficking and cybercrime in the Southeast Asia region, both alarmingly on the rise.

Harris launched a series of partnerships with Thailand aimed at driving down emissions, advancing clean energy goals and promoting sustainable development, among other matters.

Biden and Harris have also highlighted Washington's Indo-Pacific Economic Framework, launched earlier this year.



San Francisco to host APEC summit in 2023 -U.S. VP Harris

APEC 2022 in Bangkok Thailan

Fri, November 18, 2022

BANGKOK (Reuters) - The U.S. city of San Francisco will host the leaders' meeting of the Asia-Pacific Economic Cooperation (APEC) forum next year, Vice President Kamala Harris said, as the 2022 summit drew to a close in Bangkok on Saturday.

Thailand's Prime Minister Prayuth Chan-ocha, who is this week's host, handed over the chair of APEC to the United States for 2023, signalling the forum's end for this year.

"I'm happy to hand over the chairmanship to U.S. We are ready to conduct a seamless cooperation with them," he said, handing to Harris a "chalom", a woven bamboo basket used to carry goods and gifts in Thailand.

"Our host year will demonstrate the enduring economic commitment of the United States to the Indo-Pacific," Harris said in a statement released by the White House.

Harris is from Oakland, across the bay from San Francisco, and previously served as a U.S. senator for California and as attorney general for the state.

Harris, who is heading the U.S. delegation at the summit talks in Bangkok, said: "We are working to strengthen our economic relationships throughout the region, including by increasing two-way trade flows and the free flow of capital, which supports millions of American jobs."

The meeting in the California city will take place in the week of Nov. 12 next year, the U.S. statement said.

In a separate statement, APEC leaders said the group welcomed an offer by Peru to host the bloc in 2024 and by South Korea to host it in 2025.

Set up to promote economic integration, APEC's 21 members account for 38% of the global population, and 62% of gross domestic product and 48% of trade.

US VP Harris announces $20 million new clean energy funding for Mekong region



APEC summit in Bangkok


Sat, November 19, 2022 
By Poppy McPherson

BANGKOK (Reuters) - U.S Vice President Kamala Harris announced $20 million in new funding for clean energy projects in the Mekong region, during the last day of her tour of Thailand on Sunday following a regional summit.

She spoke to civil society and business leaders in Bangkok after the close of a meeting of the 21-member APEC bloc a day earlier.

"Bold climate action is not only necessary to protect the people of our planet and our natural resources, but it is also powerful driver of economic growth," she said.

In an earlier news release, she said the administration would request funding from Congress for the Japan-U.S.-Mekong Power Partnership (JUMPP), through which the two countries partner with regional nations to promote sustainable energy.

"In particular we know that the climate crisis presents a real threat to the communities who depend on the Mekong River. In Thailand, in Vietnam, Laos."






















Lauren Boebert's Democratic challenger conceded after she declared victory, even as the unexpectedly tight race has not been called and likely heads to an automatic recount

This combo image shows Democratic candidate for Colorado's 3rd Congressional District Adam Frisch, left, and U.S. Rep. Lauren Boebert, R-Colo., right.
This combo image shows Democratic candidate for Colorado's 3rd Congressional District Adam Frisch, left, and U.S. Rep. Lauren Boebert, R-Colo., right.Associated Press, File
  • Adam Frisch conceded to Rep. Lauren Boebert on Friday, despite the race not being called.

  • Frisch told a Facebook live audience he believed there was little chance he could win the seat.

  • Boebert also declared victory, saying that she was "certain" she would win even with a recount.

Democratic candidate Adam Frisch conceded to his opponent, GOP Rep. Lauren Boebert, in an extremely close race to represent Colorado's Third Congressional District.

Boebert was leading by about 554 votes with more than 99% of votes counted as of Friday evening, according to Insider's election partner Decision Desk HQ. No major media network has yet called the race, which was not expected to be competitive until the surprisingly close results began rolling in on election night.

Under Colorado state law, a recount will automatically ensue if a candidate wins by a margin that is 0.5% or less of their total vote count. Boebert's current lead of 554 out of her total 163,832 votes falls within that threshold, at about 0.34%.

Despite the results not being called yet, Frisch said on Facebook live Friday that he called Boebert to concede the race to her, adding that the chances of him winning were "very small."

"The likelihood of this recount changing more than a handful of votes is very small. Very, very small. It'd be disingenuous and unethical for us or any other group to continue to raise false hope and encourage fundraising for a recount," Frisch said during his concession speech. "Colorado elections are safe, accurate, and secure. Please save your money for your groceries, your rent, your children, and for other important causes and organizations."

Frisch did not immediately respond to Insider's request for comment.

Boebert also acknowledged the call in a Tweet on Friday, saying: "I look forward to getting past election season and focusing on conservative governance in the House majority."

The conservative firebrand had already declared victory in the race. On Thursday evening, Boebert announced on social media: "We won!"

In the accompanying video, she said there were "less than 200 votes outstanding" and that she was "certain" that she would win the race, even with the recount. Insider could not confirm the amount of outstanding votes.

"Past recounts in Colorado have resulted in far fewer votes being adjusted than anything that could affect the current outcome we're seeing tonight in this race," she added.

Meanwhile, a Thursday FEC filing showed that Frisch had already submitted a statement of candidacy for 2024, potentially setting the stage for another Boebert-Frisch showdown.

Iran leader says 'enemies' may target workers as protests rage


Iran's Supreme Leader Ayatollah Ali Khamenei attends a meeting with academic elites and scientific talents in Tehran

Sat, November 19, 2022 

DUBAI (Reuters) -Protests raged on at Iranian universities and in some cities on Saturday as Supreme Leader Ayatollah Ali Khamenei warned the country's "enemies" may try to mobilise workers after failing to topple the Islamic government in more than two months of unrest.

One of the boldest challenges to Iran's clerical leaders in decades, the protests have been gaining steam, frustrating authorities who have blamed Iran's foreign enemies and their agents for orchestrating the disturbances.

"Until this hour, thank God, the enemies have been defeated. But the enemies have a new trick every day, and with today's defeat, they may target different classes such as workers and women," state television quoted Khamenei as saying.

Women and university students have played a prominent role in the anti-government street demonstrations, waving and burning headscarves to denounce Iran's strict Islamic dress code for women.

The wave of unrest erupted in September after Kurdish-Iranian woman Mahsa Amini died in the custody of the country's morality police after she was arrested for wearing clothes deemed "inappropriate".

Protests spread into the vital energy sector last month but demonstrations by workers, which have partly addressed demands linked to pay and working conditions, have been limited.

In 1979, a combination of mass protests and strikes by oil workers and bazaar merchants helped to sweep the clergy to power in Iran's Islamic revolution.

On Saturday, activist HRANA news agency said sit-down strikes and protests were taking place on two dozen campuses in the capital, Tehran, and in major cities including Isfahan, Tabriz and Shiraz with slogans including "Freedom, freedom, freedom".

Kurdish rights group Hengaw posted videos purporting to show security forces shooting at protesters in the town of Divandarreh, killing one protester. Reuters could not verify the videos.

The official news agency IRNA said protesters damaged the home of Divandarreh's top state-sanctioned cleric and the office of the local parliament member, adding that two people may have been killed in the violence.

Videos posted on social media purported to show protests in a number of cities in western, northwestern and central Iran, some during funerals held for deceased demonstrators.

Protests also reached smaller communities. In Murmuri, a southwestern town of 3,500 residents, the local governor told IRNA about 150 protesters set fire to government buildings, banks and a post office before security forces re-established order.

HRANA said 402 protesters had been killed in the unrest as of Friday, including 58 minors. Some 54 members of the security forces were also killed, it added. More than 16,800 people have been arrested, it said.

State media said last month that more than 46 security forces, including police, had been killed. Government officials have not provided an estimate of any wider death count.

On Saturday, state television showed thousands attending at least four state-sponsored funerals for three Basij members, a police colonel, a seminary student and a border guard killed during recent unrest.

Iran's hardline judiciary has sentenced five protesters to death and said it will put on trial more than 2,000 people indicted for unrest, intensifying efforts to crush weeks of demonstrations.

(Reporting by Dubai newsroomEditing by Helen Popper and Nick Zieminski)


Kurdish exile group says Iran hits its bases in north Iraq

Sun, November 20, 2022

ERBIL, Iraq (AP) — Iranian missiles and drones struck an Iranian Kurdish opposition group's bases in northern Iraq late Sunday night, the group said.

The Democratic Party of Iranian Kurdistan, a Kurdish Iranian group exiled in Iraq, said in a statement that Iranian surface-to-surface missiles and drones hit its bases and adjacent refugee camps in Koya and Jejnikan. The group also asserted that the strikes had hit a hospital in Koya.

There were no immediate reports of casualties.

Some Kurdish groups have been engaged in a low-intensity conflict with Tehran since the 1979 Iranian Islamic Revolution, with many members seeking political exile in neighboring Iraq where they have established bases.

Iran alleges that these groups are inciting anti-government protests in Iran and smuggling weapons into the country, which Kurdish groups have denied.

Tehran has periodically launched airstrikes against the Kurdish groups' bases in Iraq. During a visit to Baghdad last week, Iran’s Quds Force commander Esmail Ghaani threatened Iraq with a ground military operation in the country’s north if the Iraqi army does not fortify the countries’ shared border against Kurdish opposition groups, Iraqi and Kurdish officials said.

Sunday's Iranian strikes in northern Iraq come a day after Turkey launched deadly airstrikes over northern regions of Syria and Iraq, targeting Kurdish groups that Ankara holds responsible for last week’s bomb attack in Istanbul.
A first-generation college student with $146,000 in student debt says blocking Biden's relief 'feels like a really sick game': 'It's not the American dream that we were promised'

Graduate students in front of White House.
Student-loan borrowers are in limbo because of court challenges to President Biden's debt-relief plan.Stefani Reynolds / AFP)
  • Guilherme Lopes, 31, is a first-generation college student with $146,000 in student debt.

  • He said the recent court decisions blocking the debt relief "feels like a really sick game."

  • The uncertainty of the relief is prohibiting him from financially planning for the future.

Guilherme Lopes was the first in his family to attend college in America.

After immigrating from Brazil to the United States at the age of 5, Lopes, now 31, says he didn't have the knowledge he needed to navigate the financial-aid system. When his high-school guidance counselors advised him to take out student loans to finance his education, that's exactly what he did.

Lopes took out federal direct loans under his own name, and his mother took out parent PLUS loans to help cover additional costs. His balance stands at nearly $146,000 — roughly $46,000 more than his balance upon graduating in 2013 due to interest. Like many in his position, he was excited when President Joe Biden said on the campaign trail that he would approve $10,000 in debt relief.

"An important part of my political views was to see how we are going to address student loans, whether we can get some relief, or if we can make the system a little easier for folks," Lopes told Insider. "So when Biden was running, it was really attractive early on when he said he would forgive $10,000."

However, shortly after Biden announced his one-time student-loan-forgiveness plan, a number of conservative lawsuits arose seeking to block the debt relief. Some of the lawsuits were dismissed by district courts — the Supreme Court even turned away two. But over the past week, two federal courts blocked the implementation of the debt relief, leaving millions of borrowers in limbo as they wait to find out when, or if, they will see an up to $20,000 reduction to their loan balances.

As a nonprofit worker currently making a five-figure salary, Lopes is also enrolled in the Public Service Loan Forgiveness program, which promises to forgive student debt for government and nonprofit workers after ten years of qualifying payments. But he still has a ways to go on that repayment plan, and he was hoping $10,000 in relief would help him progress quicker. He also had high hopes that it would aid his mother and brother, who also hold student debt.

"It feels really cruddy, because my mom is an immigrant woman who crossed the border and found citizenship here and went through the struggle, finally worked up the courage to take online class and got her master's all online, and she also owes money at the age of 65," Lopes said. "It's just terribly unkind. It's not the American dream that we were promised coming over."

'It just feels like a really sick game'

Last week, a federal judge in Texas ruled that Biden's debt relief is illegal in response to a lawsuit filed by two student-loan borrowers who didn't qualify for the full amount of loan forgiveness. On Monday, the Eighth Circuit Court of Appeals ruled that the temporary stay it placed on the relief will remain in effect until the court makes a final decision on its legality.

The Education Department has appealed the rulings. While Biden's administration has expressed confidence that it will prevail in court, Lopes said he's upset these lawsuits even happened in the first place.

"I definitely think it affects the mental health," Lopes said. "It's more of the unknown, the uncertainty, it just feels like a really sick game. Are we going to get a pause? Are our payments coming back? It's just all unnerving."

With the court decisions blocking the relief indefinitely, the department is no longer accepting new applications, and it indicated in a recent court filing that it's "examining" another extension of the student-loan-payment pause.

The financial uncertainty these lawsuits have brought, along with a potential extension of the payment pause, has kept Lopes from planning his wedding or purchasing "anything of significant value." He emphasized that he's not asking for a handout, but he feels like many Americans have a sense of "entitlement, that I went through it, so you have to go through it."

"It just seems kind of off to me," Lopes said. "It brings up a lot of anxiety."

'I have faith because the alternative is anxiety'

Lopes said he was fortunate to have his employer pay for his graduate-school degree, but during that time, he deferred paying off his undergraduate loans and interest accumulated, causing his balance to surge. He said he wished the terms of taking on student debt were made clearer to him at the outset, especially because interest has kept many other borrowers from even making a dent in the original balance they borrowed.

With the lack of clarity surrounding student-loan forgiveness, Lopes said he has "no choice" but to remain hopeful that the Biden administration will follow through, adding, "I have faith because the alternative is anxiety."

Meanwhile, many advocates and Democratic lawmakers have ideas about what Biden should do to relieve the stress millions of borrowers are feeling right now. Multiple advocacy groups have called for an extension of the student-loan-payment pause, with Wisdom Cole, the NAACP's youth and college director, saying in a Wednesday statement that the organization "fully supports extending the repayment pause until borrowers obtain the relief they deserve and have been promised."

"It is infuriating that the very people who have benefited hundreds of thousands and even millions of dollars in bailouts are now attacking relief for Americans with Pell Grants, 51% of which go to students whose families earn less than $20,000 a year," he said. "It's hypocritical, sickening, and speaks volumes about the types of politicians who must be unseated. But they won't win this fight."

Collapse of Carvana, the 'Amazon of Used Cars', Continues

Online used-vehicle dealer faces a mountain of financial and legal challenges.
THE STREET
NOV 19, 2022 
















The sky is not clearing up for Carvana.

On the contrary, big clouds continue to gather over the company which was one of the big winners of the covid-19 pandemic, with a massive growth.

Since announcing its quarterly results on Nov. 3, Carvana (CVNA) - Get Free Report shares have lost 44% of their value and are currently trading at $8.06 versus $14.35 on that day. This translates into a decline in market capitalization of approximately $1.1 billion in two weeks. Carvana currently has a market value of $1.43 billion.

The company, founded in 2012 and based in Arizona, took advantage of favorable conditions to market its new way of buying a car. The group's car vending machines stuck well with the pandemic, a period during which consumers wanted to avoid contact as much as possible, to limit their exposure to the virus.

The federal government had also flooded consumers with money via stimulus programs. Interest rates were almost zero, which meant that financing the purchase of a vehicle cost practically nothing.

Added to this, the supply chains of car manufacturers were disrupted, which made the production of new vehicles difficult. Faced with these challenges, consumers turned to the second-hand market as the waiting times for new vehicles were long. Used car prices therefore jumped, making it a good deal for Carvana.

Basically, all the winds were blowing in the right direction for the company.

New Car or Used Car?


But coming out of the pandemic, Carvana's fortunes seem to have turned completely. The used car market remains hot. But all the other factors have reversed. There is no more stimulus money. The central bank is aggressively raising interest rates and inflation is at its highest in 40 years. The economy is also close to a recession more than ever, and the waves of job cuts follow one another. Used car prices remain high but financing the transaction has become very expensive for consumers. Supply chains have improved significantly, facilitating the production of new vehicles.

This was felt in the latest quarterly results from Carvana: In the third quarter, Carvana's revenue fell 2.7% year-on-year to $3.4 billion, while net loss jumped to $283 million from just $32 million in the third quarter of 2021, the company said in a letter to shareholders.

Used car sales in the U.S. fell almost 13% year-on-year, in the third quarter of 2022.

"If you’re looking at newer used cars — models in the 1 to 3-year-old range, you may find that prices are still relatively close to what they sold for new," Consumer Reports said. "If you have to borrow money to buy the car, it may be better to find a new car that can qualify you for a lower interest rate, to say nothing of the benefit of a fresh factory warranty. Many manufacturers subsidize financing and may offer interest rates that are much lower than normal to qualified buyers."

All this complicates the affairs of Carvana, which had to go into $3.3 billion of debt to finance the acquisition of auctioneer Adesa’s physical auction business this year.




Elimination of 1,500 Additional Jobs


The group is therefore under enormous financial pressure.

"Significant nearer-term operational and financial risks for Carvana have emerged and are likely to cloud the CVNA investment story for the foreseeable future," Oppenheimer analyst Brian Nagel said in a note on Nov. 15, downgrading the stock.

He added that "we do not envision investors bidding CVNA meaningfully higher until prospects for a manageable and sustained capital base become clearer."

Nagel seems to confirm that Carvana has a liquidity problem which the group must address fairly quickly if it wants to stop the collapse. The company has between $6 billion and $7 billion in debt net of the cash on the balance sheet, according to FactSet.

But Carvana is not profitable: its adjusted EBITDA margin loss increased by 6.2% in the third quarter. EBITDA refers to earnings before interest, taxes, depreciation and amortization, which helps investors to gauge the financial health of a company.

The company is struggling to try to change things and delay as much as possible raising equity capital or adding more debt. Carvana, for example, is determined to drastically reduce costs. After cutting 2,500 jobs in May, the company has just announced an additional wave of layoffs which affects 8% of its workforce, or 1,500 employees.

"It is fair to ask why this is happening again, and yet I am not sure I can answer it as clearly as you deserve," Chief Executive Officer Ernie Garcia told employees in an email on Nov. 18. "I think there are at least a couple of factors. The first is that the economic environment continues to face strong headwinds and the near future is uncertain. This is especially true for fast-growing companies and for businesses that sell expensive, often financed products where the purchase decision can be easily delayed like cars."

In addition, "we failed to accurately predict how this would all play out and the impact it would have on our business. As a result, we find ourselves here."

The new cuts will affect "many corporate and technology teams as well as some operations teams where we are eliminating roles, locations or shifts to match our size with the current environment," Garcia wrote.

Reached by TheStreet, Carvana didn't comment.



Legal Issues


The new job cuts come after ratings agency S&P Global Ratings warned it was likely to downgrade Carvana in the near term, changing the outlook from stable to negative.

"GPU [gross profit per unit] is expected to remain weak due to higher used car depreciation rates and lower returns from selling loans and other products," said the rating agency. "Carvana generates over 50% of its GPU from selling loans and other products. With rising interest rates, it is more difficult for Carvana to compete with the large banks that can keep loan rates low, which will reduce the number of loans allocated to Carvana."

Garcia ruled out the option of raising capital on Nov. 3.

"Our goals are going to be on driving down expenses and trying to get positive EBITDA as quickly as we can," he told analysts. "We've got a bunch of committed liquidity. We've got a bunch of real estate. And I think that we feel like that puts us in a good position to ride out this storm. And we're making great moves inside the company."

But apart from these financial difficulties, Carvana also faces legal challenges. The company is facing lawsuits from customers in multiple states involving alleged issues over titles and registration and over purchasing vehicles.

Michigan Secretary of State Jocelyn Benson also suspended the retailer's license, with Carvana suing in return.

Carvana has said the lawsuits are without merit and called the decision in Michigan "arbitrary."
Women priests, homosexuality, not closed debate in Church, German bishop says


Third Synodal Assembly of German Catholics
Synodal Path
Series of conferences of the Catholic Church in Germany to discuss a range of contemporary theological and organizational questions concerning the Church



By Philip Pullella
Sat, November 19, 2022 


VATICAN CITY (Reuters) - A leading German Catholic bishop on Saturday contested the Vatican's view that debates about women priests and homosexuality were closed, saying they will have to be confronted in the future.

Bishop Georg Baetzing spoke at a news conference at the end of a week of talks between Pope Francis and Vatican officials on one side, and all of Germany's bishops on the other.

They centred on a controversial German progressive movement, known as the "Synodal Path", that aims to give lay Catholics a say on some doctrinal matters as well as the appointment of bishops.

The movement has alarmed Catholic conservatives and moderates around the world, who fear that it could lead to massive splintering similar to what happened in Anglican and Protestant Churches after they introduced similar changes in recent decades.

"As far as the ordination of women is concerned, for example, (the Vatican's) view is very clear, that the question is closed. But the question exists and it has to elaborated and discussed," said Baetzing, who is bishop of Limburg and head of the German Bishops Conference.

The Catholic Church teaches that women cannot be priests because Jesus chose only men as his apostles and that while same-sex attraction is not sinful, homosexual acts are.

Some Church progressives want the Catholic catechism to be changed so that it does not condemn homosexual acts in a committed relationship and to open a process leading to women's ordination.

"All these questions are on the table (of the German Synodal Path) and all attempts of cancel them will not have success," Baetzing said.

"Popes have tried to say the question (of women priests) is closed but the fact is that the question exists. Many young women say 'a church that refuses all of this cannot be my church in the long run,'" he said.

In 2021 the Vatican's doctrinal office ruled that priests cannot bless same-sex unions.

In September, Flemish Roman Catholic bishops issued a document allowing the practice.

Asked if he would bar priests in his diocese from blessing same-sex unions Baetzing said: "I will not deny God's blessing from those in committed relationships who are seeking it".

In July, the Vatican tried to slam brakes on the German movement, saying it risked causing a schism in the universal Church.

Baetzing said he did not see such a risk.

"It (schism) is not an option for any bishop or lay person in Germany. We are Catholics and we will remain Catholics but we want to be Catholics in a different way," he said.

(Reporting by Philip Pullella; Editing by Ros Russell)


German bishops assure Vatican but vow to proceed with reform




Vatican German BishopsMonsignor Georg Baetzing, head of the German Bishops' Conference, attends a press conference at the end of a 6-day visit of German bishops to the Vatican, including an audience with Pope Francis, in Rome, Saturday, Nov. 19, 2022. Top Vatican cardinals tried to put the brakes on the German Catholic Church's controversial reform process Friday, fearing proposals concerning gays, women and sexual morals will split the church and insisting they would be better debated later. 
(AP Photo/Riccardo De Luca)More

NICOLE WINFIELD
Sat, November 19, 2022 

VATICAN CITY (AP) — Germany’s Catholic bishops insisted Saturday that their reform process won’t lead to a schism and vowed to see it through, after tense meetings with Vatican officials who want a moratorium on proposals to ordain women, bless same-sex unions and rethink church teaching on sexuality.

The head of the German bishops' conference, Bishop Georg Baetzing, briefed reporters on the weeklong series of meetings he and 60 other German bishops had with Pope Francis and the heads of the Vatican's main offices. The periodic once-every-five-year visit took on far greater import this time given the demands for change and reform among Germany's rank-and-file Catholics following the German church's reckoning with decades of clergy sexual abuse and cover-ups.

Summarizing the German position, Baetzing said the German church would not make decisions that were the Vatican's to make, and said outsiders who fuel fears of the reform process leading to a separation from Rome were ignorant of what actually was getting debated.

“We are Catholic,” Baetzing said at a news conference. “But we want to be Catholic in a different way.”

The church hierarchy in Germany and the country’s influential lay Catholic group launched the reforms after a 2018 report found that thousands of abuse crimes were systematically covered up by German church leaders. It found that structural power issues in the church “favored sexual abuse of minors or made preventing it more difficult.”

Preliminary assemblies of the reform process, known as the Synodal Path, have sought to address how power and authority are exercised in the church. During these meetings, lay representatives and German bishops have approved calls to allow blessings for same-sex couples, married priests and the ordination of women as deacons, though the proposals must be further debated and approved for them to be enacted.

Conservative Catholics have criticized the moves and warned the German reforms, if approved, could lead to schism.

Baetzing assured the Vatican that the German church would “not make any decisions that would only be possible in the context of the universal church,” such as changes to the church’s core doctrine.

“However, the church in Germany wants to and must provide answers to the questions being asked by the faithful,” he said.

The main lay Catholic group involved in the reforms, the Central Committee of German Catholics, said the meeting made it clear that the German church was right to pursue the dialogue in Germany because "“it is not a solution to see the responsibility for the reform process solely in Rome.”

The president of the group, Irme Stetter-Karp, took issue with the joint statement issued by the Vatican and German bishops, which urged the faithful to be patient.

A “patient people of God” no longer exists, she said.

One proposal to emerge, after the Vatican unsuccessfully sought a moratorium on the German process, calls for involving Germany lay representatives in round-table talks with Vatican officials as the process continues, Baetzing said.

The German lay group We Are Church said Saturday that it was fortunate the idea of a moratorium, floated by some Vatican and German bishops, was averted.

“But the bishops as well as the Catholics in Germany still have to wait for a clear word of appreciation of the German Synodal Way,” the group said.

One matter that was discussed, but not resolved, concerns the fate of Cologne Cardinal Rainer Maria Woelki, a deeply divisive figure in Germany who has faced strong criticism for his handling of sexual abuse cases.

Francis gave Woelki, 66, a “spiritual timeout” last year but has not acted on the cardinal's offer to resign, which was submitted in March.

Baetzing said the Woelki case was raised several times, including with Francis, with the German bishops telling the pope the status quo was “unbearable for both the archbishop and the faithful” and that a decision must be taken.

Francis met individually with the bishops on Thursday and was expected to join a summit meeting Friday between the bishops and the heads of top Vatican offices. Francis failed to show up at the Friday meeting, leaving it to the Vatican hierarchs to speak.

Baetzing suggested the pope's absence might have been the work of a “clever Jesuit.” Francis had made clear a day earlier that he was comfortable living with a certain “tension” as the German reform process plays out, even if members of the Vatican bureaucracy were not.

Francis has initiated a global reform discussion that is taking place out alongside the German one but is a few steps behind.

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Kristen Grieshaber contributed from Berlin.
WALL STREET IS NOT MAIN STREET
The US economy may not be screwed after all — but the stock market sure is

Linette Lopez
Sun, November 20, 2022 

The US economy may avoid a recession, but even if it does the stock market is royally screwed.
Tyler Le/Insider

It doesn't matter if the US economy goes into recession or not: The stock market — for the foreseeable future — is royally screwed.

On the surface, the problems facing the market and the economy may seem the same. Both are trying to deal with excesses, but those excesses are wildly different.

On the economy side, the US is experiencing a violent bout of inflation created by the pandemic; pent-up demand collided with a lack of everything from workers to widgets. Like a swarm of locusts, inflation is eating up economic growth, pushing up prices and nullifying wage increases. But some of the pandemic-related conditions that got us here — like clogged supply chains — are normalizing. And there's a chance we can solve the dislocations of the past two years without barreling into a full-blown recession.

The turbulence the stock market is experiencing is different. It's a ferocious correction over a decade in the making — the comedown after a superhigh. We knew that the stock market had formed a bubble and that it was going to pop as interest rates went up. What we did not know was how violent the comedown would be — the inflation bedeviling the economy has prompted the Federal Reserve to hike interest rates faster than Wall Street had imagined. That, in turn, pushed the stock market off a cliff so steep that we still cannot see the bottom.

"It doesn't matter whether it's technically a recession," one legendary fund manager told me. "It's a bear market. We sit in the middle innings."


The economy may not be screwed …

The hangover the global economy is suffering through is a well-known story by now. Kicking the economy back into gear has been like starting an old car that had been left for years outside in the Saskatchewan snow. Snarled supply chains, chaotic housing demand, a labor shortage, and a war pushed up inflation around the globe. US consumer prices rose by 7.7% in October over last year, lower than the expected rate of 7.9% — suggesting that perhaps inflation has peaked and will continue to cool. It's a welcome sign, but still much higher than the Fed's target of 2%.

The higher inflation climbs, the harder it is to get rid of. So the Fed is taking drastic measures to shake it out of the system — in a few months it has hiked its key interest rate to 4% from 0%. By hiking interest rates, the Fed hopes to make it more expensive for people and businesses to get access to loans, helping slow the flow of money and cool off demand for things like homes, cars, and workers. If the economy slows down, demand will (in theory) get it in line with supply and bring down inflation. And it's clear that the Fed and its chairman, Jerome Powell, are committed to doing whatever it takes to wrangle inflation back down 2%.

How do I know this? Because Powell tells me every chance he gets. In fact, he's explicitly said he would rather hike rates too high and risk a recession than lower them too early and watch inflation stick.

"If we were to overtighten, we could then use our tools strongly to support the economy — whereas if we don't get inflation under control because we don't tighten enough, now we're in a situation where inflation will become entrenched," he explained. "We want to be sure that we don't make the mistake of not tightening enough or loosening policy too soon."

Despite this tough talk, there are signs that the economy may be able to survive this onslaught of inflation and the Fed's tough medicine. Job growth is still solid: The US added 261,000 jobs in October, beating analysts' estimates of 200,000. Average hourly earnings rose by 4.7%, down from a 5% increase in August but still strong. Consumer spending has been holding up, and many businesses are expecting a strong holiday-shopping season. On the inflation side, the supply-chain snarls that cause prices to soar seem to be easing, and sky-high rents for apartments and homes are starting to come down. In a note to clients, analysts at Goldman Sachs said private-sector finances were healthier "than on the eve of any US recession since the 1950s," adding that this strength helps "increase the odds of a soft landing."
… but the stock market definitely is

While you can sort of squint and see a way that the economy could get out unscathed, the same cannot be said of the stock market. That's because the stock market isn't trying to shake out a couple of years of overindulgence; it actually may have developed a consequential case of gout.

This all goes back to the Fed's move to keep interest rates at 0% after the 2008 financial crisis. The crash left us with no demand, no appetite for risk, and inflation that was too low instead of too high. So the Fed decided to do whatever it could to push investors and businesses to get riskier, to spend more, to try to grow the economy. And it worked — perhaps too well. The stock market got so hot that Wall Street coined the term TINA: "There is no alternative." You had to be in stocks — specifically tech stocks, because they were growing the fastest. Since interest rates were so low, companies that didn't make money could just borrow to keep the lights on. Since stocks only went up, investors were willing to wait for companies to make profits as long as they could show growth. Nowhere was this business model more de rigueur than in Silicon Valley. From Uber to DoorDash to Carvana, companies that made no money could not just survive but thrive. This is how you get a market where a passionate, smiling young man named Adam Neumann can fly a $47 billion company into a mountain. It's how you get a market where Tesla becomes the most valuable automaker in the world despite selling fewer than 1 million cars a year.

In 2018, Wall Street got a preview of how ugly this bubble would look once it popped in earnest. An attempt to gradually raise interest rates caused a systematic implosion in these supercharged stocks. The economy was strong enough to handle the hikes — unemployment was historically low, and inflation was tame — but the stock market had its worst year since the 2008 financial meltdown. So the Fed backed off. After 10 years of zero interest-rate policy, it was clear that the stock market was built on sand.

2020 was supposed to be about the stock market learning to live with slightly higher interest rates in an otherwise healthy economy. But the pandemic stomped on all that. To support the economy through shutdowns, the Fed went back to its post-2008 playbook. That meant the stock market went back to enjoying the conditions that had pushed it up for over a decade — but crazier. This time, retail investors joined the fun en masse, opening Robinhood accounts and buying up all kinds of silly companies, blowing the bubble up even bigger and dumber than before. From the pandemic's darkest market point in March 2020 to the peak of the rally in December 2021, the S&P 500 returned 107%. The tech-heavy Nasdaq returned 130%.

That brings us to this year. Just as it did in 2018, once the Fed started hiking rates, the stock market fell — but this time even harder.

The S&P 500 has fallen by 17% since rates started going up. The Nasdaq is down 29%. Even some recent improvement, this is what Wall Street classically considers a bear market, and it has barely made a dent in the gains the market made while everyone was trading like a bunch of drunken sailors on shore leave. A few weeks ago, Justin Simon, the founder of the investment firm Jasper Capital, explained to me that for the market to return to pre-COVID levels (still bubbly) it would have to continue to decline by 30% to 40%. We could go lower than that, and it could take years to do it. The timing is unclear because this is a bear market and it doesn't run on our schedule, but it's safe to say things are going to be ugly for the next year, if not longer.

Heading down will be a gruesome process for traders. Bear markets move in fits and starts — in death drops and rip-your-face-off rallies. Be skeptical. The Wall Street hype machine will come up with myriad silly reasons why relief is just around the corner, but it's not. If you don't recognize the bear market for what it is, you will misunderstand every new market low. That can be hard to do in the moment. Hindsight is always 20/20. What will seem obvious in two years may be difficult to accept right now.

"These rallies will be looked back on as opportunities to lighten up," the legendary fund manager told me. "But what they really do is suck people in."

Fallacies and fairy tales


Every few weeks, and without any real evidence, Wall Street will try to convince you (and itself) that Powell is losing his nerve — that the bear market is ending. Ignore all that. Even if he slows the pace of the Fed's rate hikes, Powell will not stop hiking, because the economy's health is on the line. Stocks can (and will) go to hell.

In 2018, small hikes sent the stock market reeling because it was in a bubble. The only difference now is that the bubble is larger and — thanks to inflation — the hikes are steeper, meaning the comedown is even more brutal than it would have been before.

But those are just stock prices. They don't tell the whole story of what's going on in the US economy, or even at US companies. FactSet projected that the S&P 500 would see a decline in year-over-year earnings this quarter. That's bad for stocks, because companies need economic activity to make profits. But this slowdown is coming after the best year for corporate profits since 1950, when "Howdy Doody" and "The Lone Ranger" were on TV. Corporations have cushion, even if they won't do as well as they did last year, when we were spending cash like a bunch of 14-year-olds who just took all their babysitting money to the Claire's at their local mall. It's possible that layoffs will be limitedto only the bubbliest companies.

Whether the economy will be able to handle more rate hikes without slowing into a recession is an open question that the stock market cannot answer. All stocks can do is fall in a spectacular fashion that has been not quarters, not years, but over a decade in the making. All we can do is get out of the way.

Linette Lopez is a senior correspondent at Insider.