Troubled China Shadow Bank Zhongzhi Files for Bankruptcy

CAPITALI$M

WITH CHINESE CHARACTERISTICS

Bloomberg News
Fri, January 5, 2024 

(Bloomberg) -- Chinese shadow banking giant Zhongzhi Enterprise Group Co. filed for bankruptcy, cementing the rapid downfall of a firm that oversaw more than $140 billion at its peak before succumbing to the property crisis that has wreaked havoc on the world’s second-largest economy.

Zhongzhi said it “obviously” lacked the ability to repay its debts, according to a statement Friday from Beijing’s First Intermediate People’s Court, which accepted the case. An audit found Zhongzhi’s debts were as much as 460 billion yuan ($64.3 billion), compared with assets of 200 billion yuan, according to a letter to investors in November.

The downfall marks one of China’s biggest-ever bankruptcies, putting more stress on already fragile consumer and investor sentiment. The property slump, weak domestic demand and sluggish trade are all weighing on the economy, while its benchmark stock index has plunged three years in a row.

The Zhongzhi filing came just months after the lending giant first triggered concerns in the financial markets when one of its trust-company affiliates failed to repay customers on high-yield investment products, sparking protests in Beijing.

Chinese authorities in November said they opened criminal investigations into the money management business days after the firm revealed a shortfall of $36.4 billion, telling investors it was “severely insolvent.” The company didn’t respond to an email request seeking comment outside of business hours Friday.

While the firm’s creditors are mostly wealthy individuals rather than financial institutions — limiting the direct impact on the financial system — the collapse exposes potential cracks in the $2.9 trillion trust sector. The failure also highlights the risks of the rapidly growing global private credit market, where the lack of public disclosure on debts raised outside the banking system is one of its defining traits.

Read more: Zhongzhi Crisis Exposes the Perils of Private Credit: Shuli Ren

In recent years, even as rival trusts pared risks, Zhongzhi and its affiliates, especially Zhongrong International Trust Co., extended financing to troubled developers and snapped up assets from companies including China Evergrande Group. China’s housing market continues to flounder despite a slew of incentives from Beijing to revive sales, which have have now dropped in 20 of the last 24 months.

“The persistent decline in the real estate market, coupled with stringent policies and increased financial anti-corruption measures, has hindered timely asset collection,” said Zhao Jian, head of the Atlantis Financial Research Institute in Beijing, who estimates more than half of the group’s assets are linked to real estate. “Redeeming these assets has become exceedingly challenging.”

The filing also underscores Beijing’s unwillingness to bail out struggling financial firms. China Evergrande is among several high-profile developers that have defaulted in recent years amid the real estate crisis, with little direct support from the Communist Party government.

As recently as August, China had asked two of the nation’s biggest financial firms to examine the books of Zhongrong International, potentially paving the way for a state-led rescue of the troubled shadow lender, people familiar with the matter said at the time.

A twice-a-decade financial policy meeting attended by President Xi Jinping at the end of October stressed the need to effectively prevent financial risks and crack down on any illegal financial activities. In a following study session, the banking regulator, which also oversees trust firms, vowed to use “strong medicine” to tackle major risks.

Zhongzhi’s filing is unusual in that China’s highest-profile debt failures in recent years have tended to go through debt restructurings first, avoiding formal bankruptcy. HNA Group Co., the conglomerate that collapsed with billions of dollars of debt, completed its restructuring work in 2022. China Evergrande, whose default in 2021 accelerated the country’s property crisis and which has some $327 billion of liabilities, is still struggling to avoid liquidation and hasn’t filed for bankruptcy.

“Authorities have accumulated quite some experience from handling earlier cases such as HNA Group and Anbang Insurance, so they’re well prepared for risk events like Zhongzhi and more confident they can keep it under control and avoid wider fallout,” said Shen Meng, director of Beijing-based investment bank Chanson & Co.

Shadow banks like Zhongzhi are loosely regulated firms that pool household savings to offer loans and invest in real estate, stocks, bonds and commodities. China’s trust industry is a key alternative funding source for weaker borrowers unable to get regular bank loans such as developers and local government financing vehicles. China has been cracking down on shadow banking since late 2017.

Founded in 1995, Beijing-based Zhongzhi expanded into a sprawling empire that had more than 1 trillion yuan in assets at its peak. The group holds shares in six licensed financial institutions including Zhongrong International, five asset managers as well as four wealth management firms, according to its website. It also has controlling stakes in a string of listed firms across sectors from semiconductors to health and consumption.

The firm said in November that the death of its founder Xie Zhikun in 2021 and the subsequent departure of senior executives had led to a failure of internal management. Previous efforts at a “self-rescue” didn’t live up to expectations, Zhongzhi said in the letter. At the time, lawyers and analysts estimated more than three quarters of investor cash would be lost, with just 100 billion yuan recovered from debt of as much as 460 billion yuan.

--With assistance from Zheng Li and Amanda Wang.

Bloomberg Businessweek





Chinese wealth manager Zhongzhi files for bankruptcy liquidation


Reuters
Fri, January 5, 2024 at 3:39 AM MST·2 min read

BEIJING (Reuters) -Chinese wealth manager Zhongzhi Enterprise Group has filed for bankruptcy liquidation after failing to repay debt, as the firm grapples with a deepening property market downturn.

Zhongzhi applied for bankruptcy on the grounds it could not pay its due debts and its assets were insufficient to pay all its debts, a court in China's capital Beijing said in a statement on Friday.

The court said it accepted Zhongzhi's bankruptcy liquidation application in accordance with China's enterprise bankruptcy law.

The worsening woes at Zhongzhi, a major player in China's $3 trillion shadow banking sector - roughly the size of the French economy - add to worries that the country's property debt crisis is spilling over into the broader financial sector.

The company, which has sizable exposure to China's real estate sector, apologised to its investors in a letter in November that said it was heavily insolvent with up to $64 billion in liabilities.

Police in Beijing, where the firm is based, later launched an investigation into suspected crimes committed by Zhongzhi and said it was looking into "many" suspects involved with the company.

Zhongzhi did not immediately respond to a Reuters request for comment.

China's highly indebted property sector has been reeling from a liquidity crunch since 2020. Defaults by developers since late 2021 have impeded economic growth and rattled global markets.

Shadow banking-linked wealth managers in China typically operate outside many of the rules governing commercial banks and mainly channel the proceeds of wealth products sold to retail investors to real estate developers and other sectors.

Signs of Zhongzhi's problems emerged in July when Zhongrong International Trust Co, a leading trust company controlled by Zhongzhi, missed payments on dozens of investment products.

In August, Zhongzhi told investors it faced a liquidity crisis and would conduct a debt restructuring. The management said the plan is for "self-rescue" through restructuring, with a focus on debt collection and asset liquidation, but bankruptcy is also an option.

The latest development would help the group to speed up asset liquidation, said Ying Yue, a lawyer at Leaqual Law Firm.

Yet the court process is expected to be slow, and investors will likely incur hefty discount in the repayment plan and may only be able to recover 30% of their money, based on precedent cases, said Ying.

Last month, Hywin Holdings Ltd., a smaller wealth manager whose products are primarily invested into real estate, said that it has been unable to promptly fulfil client redemption requests.

($1 = 7.1562 Chinese yuan renminbi)

(Reporting by Ziyi Tang, Ryan Woo and Beijing Newsroom; Editing by Barbara Lewis and Ros Russell)

A supermarket chain has gone beyond shaming PepsiCo for ‘shrinkflation’—now it’s pulling Cheetos and Doritos off the shelves across Europe

Steve Mollman
Thu, January 4, 2024 

Thomas Samson—AFP/Getty Images

Carrefour is taking its spat with PepsiCo up a notch. No longer content to, as it did in the fall, label PepsiCo’s examples of “shrinkflation,” a nasty variant of inflation where the bag gets emptier while the price remains the same, or even increases, now the French grocery giant is doubling down. Starting Thursday with in-store signs that cite “unacceptable price increases,” the supermarket chain is telling shoppers in four countries that it will no longer carry PepsiCo products.

The changes start this week in France, Italy, Spain, and Belgium, meaning Cheetos, Doritos, and Quaker cereals will suddenly be harder to find there.

But this is just the latest clash between the two behemoths. In September, Carrefour started labeling egregious examples of shrinkflation on its shelves, with PepsiCo a prominent target. The labels read: “This product has seen its volume or weight fall and the effective price from the supplier rise.”

James Walton, chief economist at the Institute of Grocery Distribution, calls delisting a “last resort,” telling Reuters that “nobody wins if the goods that people want are not available on the shelves.”

But Carrefour has on its side European governments, which have been pressuring big companies to lower prices in the battle against inflation.

Carrefour CEO Alexandre Bompard argued last year that consumer goods companies were not cooperating with efforts to cut prices, despite the cost of raw materials falling. French finance minister Bruno Le Maire agreed, pointing a finger at PepsiCo, Unilever, and Nestlé, in particular.

“I don’t see why when prices go up companies pass on the increase immediately, but when the price of wheat falls, the price of pasta takes three months to fall. It’s unacceptable,” Le Maire said last April, warning, “I will use all the powers at my disposal to ensure that the big industrial companies pass on the decrease.”

France’s government has asked retailers and suppliers to finish their yearly price negotiations in January, a few months sooner than usual, Reuters reported. France is unusual in that it protects its farmers by forcing supermarkets to negotiate prices only once a year, and last year prices got locked in amid high inflation.

The shrinkflation campaign aimed to make suppliers rethink their pricing policies, but, judging by Carrefour’s move this week, it fell short with PepsiCo. And Carrefour isn’t the only supermarket chain taking a stand in Europe. Its Belgian rival Colruyt said that price disputes spurred it to stop supplies from Mondelez—the maker of Oreos and Philadelphia cream cheese. As Reuters reported, the grocer noted that with energy and raw material prices falling, rate hikes were no longer justifiable.

This story was originally featured on Fortune.com

France's Leclerc backs Carrefour in pressuring food producers

Reuters
Fri, January 5, 2024 

FILE PHOTO: Michel-Edouard Leclerc, CEO and Executive Chairman of French retailer E. Leclerc SA, attends the third annual tech conference "Inno Generation" in Paris

LONDON (Reuters) - The chairman of France's biggest supermarket chain E. Leclerc called on all big consumer goods firms to lower their prices as he weighed in on competitor Carrefour's decision to drop Pepsico products amid fraught price negotiations.

Grocery retailers in several countries including Germany and Belgium have stopped orders of some products over the last year, a tactic in negotiations that inflation has made more combative.

In a post on LinkedIn, Michel-Edouard Leclerc said: "We must in the coming month convince all these big suppliers who made the mistake of overly increasing their prices, to lower them now, or moderate them."

France has been gripped by a debate over the price of staples, with retailers claiming producers' price increases are unjustified. The government has demanded retailers and suppliers finish annual price negotiations in January, two months earlier than usual, as it seeks to lower inflation.

Carrefour said its stores in France, Belgium, Italy, Spain, and Poland would no longer stock products including Pepsi, Lay's Crisps, Cheetos, and 7up because of "unacceptable price hikes".

Carrefour has more than 10,000 stores across the five countries according to its 2022 annual report, accounting for more than two-thirds of its global footprint.

In a statement, PepsiCo said: "We've been in discussion with Carrefour for many months and we will continue to engage in good faith in order to try to ensure that our products are available."

The French market as a whole accounted for just 1% of revenues for PepsiCo in 2022 according to Nielsen figures analysed by Barclays.

E. Leclerc did not immediately reply to a request for comment and questions about whether it would also withdraw Pepsico or any other products.

(Reporting by Helen Reid, additional reporting by Richa Naidu and Piotr Lipinski; editing by Barbara Lewis and Elaine Hardcastle)

PepsiCo products are being pulled from some Carrefour grocery stores in Europe over price hikes


Fri, January 5, 2024

PARIS (AP) — Global supermarket chain Carrefour will stop selling PepsiCo products in its stores in France, Belgium, Spain and Italy over price increases for popular items like Lay's potato chips, Quaker Oats, Lipton Iced Tea and its namesake soda.

The French grocery chain said it pulled PepsiCo products from shelves in France on Thursday and added small signs in stores that say, “We no longer sell this brand due to unacceptable price increases.”

It comes as a new French law meant to fight the rising cost of living has supermarkets facing millions in fines if they don't reach a deal with suppliers on prices by the end of the month.

The ban also will extend to Belgium, Spain and Italy, but Carrefour, which has 12,225 stores in more than 30 countries, didn't say when it would take effect in those countries.

PepsiCo products were still on shelves Friday in Rome and Barcelona. Carrefour Italia’s press office said information will be posted for customers in their stores in Italy in the next days.

PepsiCo said in a statement that it has “been in discussion with Carrefour for many months and we will continue to engage in good faith in order to try to ensure that our products are available.”

The company behind Cheetos, Mountain Dew and Rice-A-Roni has raised prices by double-digit percentages for seven straight quarters, most recently hiking by 11% in the July-to-September period.

Its profits are up, though higher prices have dragged down sales as people trade down to cheaper brands. PepsiCo also has said it's been shrinking package sizes to meet consumer demand for convenience and portion control.

“I do think that we see the consumer right now being more selective,” PepsiCo Chief Financial Officer Hugh Johnston told investors in October.

The Purchase, New York-based company said price increases should ease and largely align with inflation, which has fallen considerably worldwide since crunched supply chains during the COVID-19 pandemic and then Russia's war in Ukraine sent prices surging.

However, the 20 European Union countries that use the euro currency saw consumer prices rise to 2.9% in December from a year earlier, rebounding after seven straight monthly declines, according to numbers released Friday.

Prices for food and non-alcoholic drinks have eased from a painful 17.5% in the 20-country euro area in March but were still up by 6.9% in November from a year earlier.

The government of French President Emmanuel Macron has fought back on the rising cost of living for households, passing a November law to implement “emergency measures” to fight high prices.

The law moved up annual negotiations between supermarkets and their suppliers on setting prices and more to Jan. 31 from March 1. Fines have been increased to 5 million euros ($5.5 million) for grocery companies that fail to meet the new deadline for setting prices.

Burt Flickinger III, managing director of grocery consultancy Strategic Resource Group, said he thinks PepsiCo was targeted because the company has been one of the most aggressive in raising prices. He thinks other big brand names could be next and that other European retailers could follow Carrefour's lead.

Pulling products off shelves over prices is rare, but it happens. Flickinger noted that Kraft Heinz stopped supplying British retailer Tesco with some of its items in 2022 for a week over a pricing spat.

Rob Dongoski, agribusiness and food lead in the consumer practice of management consultancy Kearney, said the showdown between the two big brands represents the ultimate test of customer loyalty.

“Are you loyal to your store or loyal to your brand?” he said.

In the U.S., several grocery sellers including Walmart have expressed displeasure at consumer product companies' moves to keep pushing up prices even as overall inflation has come down. Particular problem areas had been packaged foods and household goods.

Walmart's CEO Doug McMillon said in May that, “We all need those prices to come down."

Stew Leonard Jr., president and CEO of Stew Leonard’s, a supermarket chain with stores in Connecticut, New York and New Jersey, said in July that he warned the big consumer product companies that he wouldn’t accept any more price increases because he believed customers had reached a tipping point. But he noted on Friday that price increases have eased for many items, except for meat.

“It's hard to justify price increase when overall costs are coming down,” Leonard said.

For its part, PepsiCo has pointed to higher costs for grain and cooking oil for its rising prices. Costs for those food commodities surged following Russia’s invasion in Ukraine but fell considerably on global markets last year from record highs in 2022.

The U.N. Food and Agriculture Organization said Friday that its food price index was 13.7% lower in 2023 than the year before, but its measures of sugar and rice prices grew in that time. That overall relief still is not being felt by families at supermarkets.

___

Durbin reported from Detroit. Associated Press reporter Frances D’Emilio in Rome and AP Retail Writer Anne D'Innocenzio in New York contributed to this report.

Sylvie Corbet And Dee-ann Durbin, The Associated Press

Brazil’s Export Boom Rekindles Memories of Past Commodity Bonanza

Felipe Saturnino, Barbara Nascimento and Maria Eloisa Capurro
Fri, January 5, 2024 

 

 

(Bloomberg) -- Brazil’s exports proved so strong in 2023 that they are rekindling memories of the commodities bonanza that briefly catapulted Latin America’s largest economy to unusually fast growth rates in the early 2000s.

The nation’s trade surplus hit $9.4 billion in December, more than all estimates in a Bloomberg survey of economists that had a median forecast of $7.7 billion. For 2023 as a whole, Brazil posted a trade surplus of $98.8 billion, well above the $61.5 billion recorded in 2022 and the widest in more than 30 years.

Vice President Geraldo Alckmin, who also heads the trade ministry, said the surplus was “significant” and added the government expects exports to increase even more in 2024, to $348 billion. Last year’s result “helps the country’s international reserves and our economy,” he told reporters Friday after the figures were published.

The news couldn’t come at a better time for President Luiz Inacio Lula da Silva. The leftist leader is facing the prospect of a slowing economy and falling tax revenue in 2024, when he will need money to support his ambitious investment plans without jeopardizing the country’s fiscal targets.

Brazil’s economic success during Lula’s first two terms as president — from 2003 to 2010 — resulted in part from a commodities boom coupled with wealth distribution policies his government implemented. Now, even with commodities prices below those levels, the country’s overall export volume has surged, with oil, soybeans and other agricultural products leading the way.

“Are we going through a second period of external bonanza?” economists at Bradesco bank asked in a note to clients. “Besides oil, exports of agricultural products have increased nearly 30% in volume in 12 months through October.”

SPX Capital, a Brazilian investment firm with $12.5 billion under management, called it a structural change that will ensure robust trade surpluses for years to come.

Other hedge funds have a similar analysis.

Verde Asset Management last month started betting the real will strengthen against the dollar, saying that yearly trade surpluses of $100 billion or above will likely become Brazil’s “new normal.” The Sao Paulo-based firm justified its call by citing growing volumes of oil and soy exports — products that account for the largest value of Brazil’s foreign sales.

XP Inc. also expects the real to strengthen going forward. Just this week the investment firm revised its end-2024 estimate for the Brazilian currency to 4.70 reais per dollar, from 4.85 — based on prospects of Brazil’s strong trade performance coupled with expectations of rate cuts by the Federal Reserve.

“There has been a change of level in Brazil’s trade balance,” and surpluses are likely to remain above the nearly $62 billion recorded in 2022, said Rodolfo Margato, XP’s vice president of economic research. He forecasts a $86 billion surplus in 2024.

Oil and Agriculture

Brazil is reaping the benefits of recent investments made in oil production, together with productivity gains in agribusiness. Although some cyclical factors contributed to the performance of Brazil’s trade balance in 2023, “there are permanent and structural elements favoring the production of oil, soybeans and corn,” Margato said.

Soy exports rose 14.4% in value between January and December, according to government statistics. Soy sales represented 15.7% of total export revenue in 2023, up from 13.9% for 2022.

Oil exports have jumped by nearly 50% in volume over the past five years, despite Lula’s ambitions to turn Brazil into a global leader in green energy. In November, the country was invited to join the OPEC+ alliance in a sign of its growing relevance as an oil supplier.

As exports soar, Brazil’s external accounts have also improved. Its current account deficit has held roughly steady at $1.5 billion in November compared with a year ago, thanks to a trade surplus that was the widest ever for the month.

--With assistance from Giovanna Serafim, Vinícius Andrade, Matthew Malinowski and Beatriz Reis.

POSTMODERN STATE CAPITALI$M

India's sovereign fund NIIFL appoints Sanjiv Aggarwal as CEO


Reuters
Fri, January 5, 2024 

BENGALURU (Reuters) - India's quasi-sovereign wealth fund, the National Investment and Infrastructure Fund Limited (NIIFL), named Sanjiv Aggarwal as its CEO and Managing Director (MD) on Friday.

Aggarwal brings "significant experience" in the infrastructure and energy sectors and takes over from Rajiv Dhar, who has been serving as the interim CEO and MD since May 2023, the statement said.

Former CEO and MD, Sujoy Bose, resigned from the company in May 2023.

Aggarwal previously worked at UK-based investment firm Actis, where he oversaw the company's energy investments in Asia, including the sale of Actis' Indian renewable energy platform Sprng Energy to energy major Shell Plc in April 2022 for $1.55 billion.

His appointment comes at a time when the NIIFL, which was founded in 2015 and manages more than $4.9 billion in equity capital commitments, has stepped up its investments in the infrastructure and growth equity segments.

Last month, it invested about 6.75 billion rupees ($81.16 million) in the new greenfield airport project in Andhra Pradesh, to be developed by airport operator GMR Airports.

In October 2023, it partnered with the Japan Bank for International Cooperation (JBIC) to introduce a $600 million fund aimed at funding sustainability projects.

The fund is also an investor in local private equity and mid-market private equity funds such as Multiples Alternate Asset Management and Lighthouse India Fund IV. ($1 = 83.1650 Indian rupees)

(Reporting by Navamya Ganesh Acharya in Bengaluru; Editing by Janane Venkatraman)

“Oil Five” Sovereign Wealth Funds Pass $4 Trillion Mark

By Charles Kennedy - Jan 03, 2024

The sovereign wealth funds of the Gulf Cooperation Council members topped $4 trillion last year, which was an all-time high.

Called the “Oil Five”, the group of top sovereign wealth funds includes three entities from the United Arab Emirates, one from Saudi Arabia, and the Qatar Investment Authority. The five invested a total $75.6 billion last year, which was a decline on 2022 investments, the Khaleej Times reported, citing data from a report by Global SWF.

The Saudi Public Investment Fund and the Qatar Investment Authority were the most active investors, accounting for the bulk of the five’s total, at some $68 billion. The Saudi sovereign wealth fund was also the biggest investor globally last year, deploying $31.6 billion across 49 deals.

The amount was a 33% increase on 2022 and a record for any sovereign wealth fund. The total spend of sovereign wealth funds last year reached $123.8 billion. The five oil funds from the Gulf were the most active investors during the year.

The increase in investments for the Gulf oil kingdoms’ sovereign wealth funds comes amid lower oil prices and also lower production for Saudi Arabia. Based on their assets under management, however, it appears the effect of the oil price rout last year will manifest with a delay.

The UAE, meanwhile, launched a new investment fund at the COP28 climate conference in December. The entity will have a size of $30 billion and will be a partnership between the Emirates, BlackRock, TPG, and Brookfield, the Financial Times reported in late November, citing sources in the know.

A day later Reuters confirmed the news citing the official announcement of the UAE’s President, who said the fund, dubbed ALTERRA, will seek to raise up to $250 billion by the end of the decade, to invest in in climate-related initiatives.

By Charles Kennedy for Oilprice.com

BIDENOMICS

The US labor market just had one of its best years of the decade.  5 charts tell the story.

Josh Schafer
·Reporter
Fri, January 5, 2024 

The US labor market just finished a year that many thought would see a recession with one of the highest 12-month job totals seen in the last decade.

Including an unexpectedly strong December report, the US labor market added a total of nearly 2.7 million jobs in 2023. 

Excluding outsized gains from the rebound from pandemic-era firings and re-hiring in 2021 and 2022, the most recent year was the most robust for job increases since 2015 and the third highest since 2000.

"The key reason why economic activity surpassed expectations in the US and actually, globally, is the fact that labor market resilience was a key feature of the economic landscape," EY chief economist Greg Daco told Yahoo Finance. "Businesses, business executives, were keenly focused on ensuring that they had the right talent to navigate this very unusual period of impact."

Entering the year, many economists believed the Federal Reserve's aggressive interest rate hikes would slow the labor market as companies looked to cut expenses and protect profits as the cost of capital increased. But that didn't fully come to fruition.

"You look at these very rapid rate increases, and you're assuming that means there's going to be these kind of catastrophic impacts on the economy," Jefferies US economist Thomas Simons recently told Yahoo Finance.

"But in reality, both the household and the corporate sector are much more insulated from rate hikes than it appeared, and certainly than they have been in previous rate hiking cycles, based on just how they fund their activity."

This unusual reaction to rate hikes, combined with employers struggling to rehire workers after the pandemic, created an economic rarity. After the most aggressive federal interest rate hiking cycles in decades, the unemployment rate was nearly unchanged from where it sat when the Fed began hiking rates in March 2022.

The unemployment rate ended 2023 at 3.7%, just slightly above the March 2022 level of 3.6%. The average unemployment rate for the year, 3.6%, matches 2022's reading as the lowest since 1969.

The labor market also entered 2023 in an obscure predicament.

Sectors like leisure and hospitality, government, and healthcare were severely impacted during the pandemic and were still rebuilding throughout the year. That rebound, combined with more workers joining the workforce, contributed to the surprise in job gains.

With bonuses and other lavish incentives driving job gains, some wondered if the full pool of Americans would ever come back to work. They did, contributing to the quickest labor market recovery in history.

In fact, the portion of prime age workers in the labor market hit an annual average of 83.3% in 2023, the highest average in 21 years.

"The ongoing rebound in participation in the labor force, I mean, it's massive," Bank of America US chief economist Michael Gapen told Yahoo Finance recently when describing why the economy outperformed in 2023. "The numbers are massive."

Another narrative about the labor market also failed to materialize.

At the beginning of 2023, the thinking went that a labor market slowing would force the economy into recession, as less employment would result in less disposable income for consumers powering economic growth. But that, too, didn't play out in a year that was defined by resilient consumer spending.

And part of that spending was driven by resilient wage growth.

Average hourly earnings growth in 2023 ended at 4.3%, the third-highest total since 2008.

Josh Schafer is a reporter for Yahoo Finance.

Ukraine's Foreign Ministry says Italian exhibition about "flourishing" Mariupol is a provocation

Ukrainska Pravda
Thu, January 4, 2024 

Stock photo: Getty Images

The Ministry of Foreign Affairs of Ukraine has described a propagandistic event due to be held in the Italian city of Modena as a provocation. The event claims that the Ukrainian city of Mariupol is "being rapidly rebuilt" after being occupied by Russia.

Source: European Pravda with reference to a statement by Oleh Nikolenko, spokesperson for Ukraine’s Foreign Ministry

Details: "The exhibition in Modena about the ‘flourishing’ of Mariupol under Russian occupation is a provocation," Nikolenko said.

He stated that Ukraine’s Foreign Ministry has ordered the Ukrainian embassy in Rome to prepare an official statement.

"On the official level, Italy strongly supports the sovereignty and territorial integrity of Ukraine. And we expect that this propagandistic event will provoke a sensible reaction," Nikolenko noted.

Earlier it was reported that the propagandistic event, which alleges that Mariupol is "being rapidly rebuilt" after being occupied by Russia, is planned to be held in the Italian city of Modena on 20 January.

The event’s advertising contains the usual Kremlin narratives about an alleged "civilian uprising" in Donbas - actually the actions of Russian saboteurs during the seizure of power in the region in 2014 - and the "rapid rebuilding process" in the city, which was devastated by Russia’s regular forces during its occupation in the spring of 2022.

Europe must convince Russia it cannot win – FT

Ukrainska Pravda
Thu, January 4, 2024 

Photo: The General Staff of the Armed Forces of Ukraine

According to British historian Timothy Garton Ash, there is currently no situation that could lead to a frozen conflict in Ukraine or a negotiated settlement with Russia. In his view, Europe should wake up and do enough for Kyiv to ensure Ukraine's victory.

Source: Financial Times

The article was written by British historian, journalist and author Timothy Garton Ash. He is the author of the book Homelands: A Personal History of Europe.

Quote: "For a start, we must be clear where things stand on the ground in Ukraine. There is no stalemate of the kind that might lead to a frozen conflict or negotiated settlement, as some in the west naively hope.

Rather, we are in the middle of a long, complex war that will probably last until at least 2025, if not longer. Neither side is giving up; either can still win, but not both."

Details: It is noted that the choice made in the next few months by the democracies that support Kyiv, i.e. Ukraine's Western partners, will be crucial for the outcome of the conflict.

The author believes that the West is currently doing enough to prevent Ukraine's defeat but not enough to help it win.

The article adds that in 2024, the partners could provide Kyiv with the tools to regain more territory and convince Russia that it cannot win: "That is the only path to a lasting peace."

In his opinion, Ukraine should be provided with more air defence immediately, with more long-range missiles, including German Taurus and US ATACMS, so that Ukraine can continue to push back Putin's Black Sea Fleet.

In the long run, a necessary condition for victory will be more intensive training of Ukrainian troops and a rapid, significant increase in industrial production of weapons and ammunition.

In conclusion, the historian believes that the responsibility thus falls on Europe, as it is, after all, about the defence of a European country.

He also compared the New Year's messages of European leaders.

UK Prime Minister Rishi Sunak did not even mention the war in his laudatory report on his government's successes, which was obviously aimed at this year's general election.

German Chancellor Olaf Scholz touched on it only in passing before moving on to the sacred topic of the German economy.

Donald Tusk, the new Prime Minister of Poland, devoted his speech entirely to the restoration of democracy in the country.

French President Emmanuel Macron, focusing on the theme of French pride, proposed a "rearmament of European sovereignty", including "to stop Russia and support Ukrainians".

But it was Finnish President Sauli Niinistö who delivered the most important message: "Europe must wake up".

Danish Prime Minister Mette Frederiksen was surprisingly blunt: "Ukraine lacks ammunition. Europe has not delivered what is needed. We will press for more European production. It’s urgent. And the Danish F16s will soon be in the air. The war in Ukraine is also a war for the Europe we know."

The historian believes that this is exactly the language we need.

WAR TRAIN

Ukrainian railways transport over 2 million passengers to Europe in 2023

Elsa Court, The Kyiv Independent news desk
Fri, January 5, 2024 


Ukraine's state-owned railway company Ukrzaliznytsia transported a record 2.1 million passengers to European countries in 2023, the company reported on Jan. 5.

The airspace above Ukraine has remained closed since the start of Russia's full-scale invasion on Feb. 24, 2022, meaning that road or rail travel is required to enter or exit Ukraine.

Ukrzaliznytsia operates services to Warsaw, Chelm, and Przemysl in Poland, Vienna in Austria, and Chisinau in Moldova. Trains also run to Chop, a town on the border with Hungary, allowing passengers to connect with trains to Budapest.

In total, the company transported 25 million passengers in long-distance trains in 2023.

The company reported a record amount of freight in November 2023, when it transported 14 million metric tons of cargo, a 33.8% increase compared to the same period the previous year.

On the same day, Ukrzaliznytsia's Deputy Director of Commercial Work Valerii Tkachov said his company was preparing to transport 23 trucks stuck at the Polish border by train amid the ongoing blockade by Polish haulers.

Oscar Pistorius release: A reminder of South Africa's femicide problem

RACIST MISOGYNIST WHITE MAN 

Danai Nesta Kupemba - BBC News
Fri, January 5, 2024 

Reeva Steenkamp is one of the many victims of femicide in South Africa

Should men who murder women be entitled to the privilege of parole?

This question around the early release of inmates, albeit under certain conditions, has been raised in South Africa following the freeing on parole of former Paralympic champion Oscar Pistorius.

This was after he had served half of his sentence for the murder of his girlfriend, Reeva Steenkamp, on Valentine's Day in 2013.


South Africa has a particular problem with femicide and violence against women. In 2020, a woman died at the hands of her intimate partner on average every eight hours, according to a study by the University of the Free State.

In 2019, South Africa ranked among the five countries with the highest rates of the murder of women, according to the United Nations.

This is why campaigners think an exception should be made for the perpetrators of these crimes to the country's normal rules around early release.

For Michael van Niekerk, the fact that Pistorius is now out of prison "feels like a kick to the gut".

He is the founder of Keep the Energy, an organisation that spreads awareness about violence against women, children and LGBTQ+ people in South Africa.

Mr Van Niekerk fervently believes that those responsible for gender-based violence and murder should not be granted parole.

Beyond the numbers of women murdered, South Africa also has extremely high levels of rape - in the three-month period between July and September last year, for example, more than 10,500 incidents were reported to the police.

"I have seen men get released and commit the same crimes over and over again," he says.

Oscar Pistorius, seen here outside court in 2014, will be on parole for the next five years

But Chrispin Phiri, spokesperson for the justice ministry, says that people have misunderstood the nature of parole.

It is "crucial to understand that parole does not equate to absolute freedom at all", he tells the BBC.

The purpose of parole is to rehabilitate offenders and guide them back into society.

Mr Phiri says the argument that perpetrators should not get parole is rooted in a "misunderstanding that [it] signifies complete freedom - which is certainly not the case".

Pistorius will be monitored by the authorities for five years until his more than 13-year sentence expires in 2029. He will have to abide by certain conditions, for example being confined to the home for certain hours each day, as well as a ban on drinking alcohol.

He will also have to attend therapy sessions, including programmes on gender-based violence.

This has gone some way to reassure the mother of the woman he killed. Last year, June Steenkamp said she would be "concerned for the safety of any woman" who came into contact with him after he was freed.

But these measures do not satisfy everyone.

"There is a lack of thinking, or empathy for victims in this scenario," says Mbali Pfeiffer Shongwe.

The 24-year-old activist, who works with Instagram account Girls Against Oppression, is a survivor of gender-based violence, and is frustrated with the country's parole system.

She believes anyone convicted of murder, rape, serious assault, theft, kidnapping, public violence and other serious crimes should not get parole.

"The most basic form of respect would be for a full sentence to be served," she says.

But there are some who believe it is right that Pistorius is no longer in prison.

The BBC spoke to several people who supported his early release but chose to remain anonymous for fear of a backlash against them.

One 25-year old woman believes that Pistorius has paid his penance.

"He has done his time, he has been rehabilitated. He is not a threat to society," she said, adding that because of his notoriety he will have a difficult life whether or not he is in prison.

June Steenkamp did not oppose her daughter's killer being freed. "No amount of time served will bring Reeva back. We, who remain behind, are the ones serving a life sentence."

"It just feels like woman are screaming into the abyss. It's like our cries are not being heard"", Source: Palesa Muano Ramurunzi, Source description: University of Cape Town law graduate, Image: Palesa Muano Ramurunzi

However, for many there is a wider point to be made.

"It just feels like women are screaming into the abyss. It's like our cries aren't being heard," says Palesa Muano Ramurunzi, a 25-year-old University of Cape Town law graduate.

She is fed up with the level of violence that women in her country face. Her belief that barring parole for those convicted of crimes relating to gender-based violence is not meant to "undermine other forms of violence but to confront an urgent crisis".

"There is a palpable sense of entitlement that men often harbour towards the bodies of women," Ms Ramurunzi says, her voice filled with hopelessness.

The ever-present possibility of being killed is a devastating thread linking many women in South Africa.

Ms Steenkamp's last Instagram post proved to be a foreshadow of the tragedy that befell her.

My friend Reeva Steenkamp

The post condemned the killing of 18-year-old Anene Booysen who had been gang-raped, disembowelled and dumped in a construction site in the Western Cape in February 2013.

Her caption read: "I woke up in a happy safe home this morning. Not everyone did. Speak out against the rape of individuals in SA. RIP Anene Booysen."

The murder of Ms Booysen dominated local and international headlines - until Ms Steenkamp's own murder took over the news cycle less than two weeks later.

There have been numerous protests and government promises regarding gender-based violence

Mara Glennie, founder of Tears, a South African domestic abuse helpline, says femicide is "deeply entrenched in institutions and traditions in South Africa".

"In a nation with some of the world's highest levels of violence against women, the laws are failing women," she says.

Even the government has struggled to address the issue, she argues.

"The government has set up task forces and made promises to the women of this country. And yet, after decades of promises, femicide and gender-based violence remain consistently pervasive," Ms Glennie says.

President Cyril Ramaphosa has vowed action to address the rampant levels of femicide in South Africa, calling it an "an assault on our humanity".

The threat of violence shrouds every aspect of women's lives in the country, with new fears forming with each case.

The post office, the park and their own home are places to be hyper-vigilant, and never completely safe.

Ms Shongwe says even after South African women experience violence and survive, it is never the last time.

"You are always looking out for what might happen next," she says.
You may also be interested in:

Are men the key to fighting rape?


'I was raped, now I fear for my daughters'


Will I be next? South Africa women ask


What next for Oscar Pistorius?




Paralympian Oscar Pistorius Released 3 Years Early From Prison
Afouda Bamidele
Fri, January 5, 2024 


MEGA

South Africa's former Paralympic star, Oscar Pistorius, has finally tasted freedom after nearly a decade behind bars for murdering his girlfriend.

He shot Reeva Steenkamp multiple times through a bathroom door in 2013, claiming he mistook her for a burglar. However, the former professional sprinter was found guilty of the crime and sentenced to 13 years and five months.

After serving ten years of his prison sentence, Pistorius was released on parole with strict conditions — an arrangement Steenkamp's mother welcomed but stressed that no punishment could ever fill the hole of her daughter's absence.

Oscar Pistorius Will Live Under Strict Rules Until His Sentence Expires In 2029

Under South African law, all convicts are entitled to parole under certain conditions and are considered eligible once they have served half their total sentence. Pistorius's early release comes three years shy of completing his 13-year and five-month term.

But leaving his prison cell did not automatically grant the double-amputee athlete complete freedom. As stated, he will live under strict conditions, with most of his time spent indoors until his sentence expires in 2029.

For specific hours of the day, Pistorius will be confined in his home, where he is not allowed to speak to the media or consume alcohol. He must also attend therapy to deal with issues relating to gender-based violence and anger.

Following his release, the former Olympic gold medalist is believed to have sought refuge at his uncle's home, per BBC. His relative reportedly lives in an upmarket suburb in Pretoria. It is still being determined if this is where Pistorius plans to live out the remainder of his sentence.



While Pistorius figures out his life, he owes part of his early release to his late girlfriend's mother, June. In a statement, the Steenkamp matriarch noted that she accepted the decision to release her daughter's killer since her family had "always known that parole is part of the South African legal system."

She heartily welcomed the strict conditions placed on Pistorius and noted that the "law must take its course." Despite accepting these terms, June stressed that nothing could ever make her daughter's absence right. In her words:

"Has there been justice for Reeva? Has Oscar served enough time? There can never be justice if your loved one is never coming back, and no amount of time served will bring Reeva back. We, who remain behind, are the ones serving a life sentence."

She continued, "My only desire is that I will be allowed to live my last years in peace with my focus remaining on the Reeva Rebecca Steenkamp Foundation, to continue Reeva's legacy."

Oscar Pistorius Was Granted Parole After Board's Assessment Of His Profile

Before his release, the South African Department of Correctional Services announced that Pistorius would be granted parole in November 2023. They noted that he was released early after a parole board reviewed his case.

They dropped the news via a statement on social media, writing: "The Department of Correctional Services (DCS) confirms parole placement for Mr Oscar Leonard Carl Pistorius, effectively from 5 January 2024."

"Mr Pistorius was initially convicted of culpable homicide in 2014, but the case went through a number of appeals and was eventually ratified to 13 years and five months in 2017," their statement continued.

The correctional services department stressed the importance of parole placement as part of the rehabilitation program to deal with "offending behavior." They also noted authorities would keep an eye on Pistorius until he finished his sentence, writing:

"Mr Pistorius will complete the remainder of the sentence in the system of community corrections and will be subjected to supervision in compliance with parole conditions until his sentence expires."

The news evoked fans' sympathy, with many calling for Pistorius to be released sooner. "Let the man go home, why are you still keeping him until January?" Someone wondered, while another penned: "He served his time shame. Now he can go back to running, continue his career, get a new Reeva, have a family. Life goes on."

Additionally, sources noted Pistorius's parole conditions included therapy because his late girlfriend's mother had expressed concerns about his "huge anger issues." In a letter to the parole board, June noted she was worried about the "safety of any woman" who would encounter her daughter's killer after his release.

Palestinian supporters to press supes for Gaza ceasefire resolution next week in SF

Bay City News
Sat, January 6, 2024

(BCN) — A resolution calling for a ceasefire in Gaza will come before the San Francisco Board of Supervisors for a committee hearing Monday, one day before a potential final vote by the full board.

On Dec. 5, hundreds of Palestinian supporters spoke in support of the resolution at its introduction. A public comment period will be open again Monday at a Rules Committee hearing.

Alaska Airlines grounding all Boeing 737 MAX-9s after hole blows open in cabin

The ceasefire resolution could be brought before the full board at its regular meeting on Tuesday.

If approved, San Francisco would join the cities of Oakland and Richmond in publicly condemning the genocidal war on the Palestinian people.\

The resolution calls for a sustained ceasefire, an influx of humanitarian aid, the release of all hostages and the condemnation of antisemitism, Islamophobia and anti-Palestinian hate.

Since the Oct. 7 attack by Hamas, which resulted in the death of more than 1,200 Israelis, more than 22,500 people have been killed in Gaza, according to the Palestinian Health Ministry.

Copyright © 2024 Bay City News, Inc.

Silicon Valley residents hold town hall calling on Rep. Anna Eshoo to support Gaza ceasefire

LaMonica Peters

FOX NEWS GLEEFULLY REPORTS
Thu, January 4, 2024

LOS ALTOS, Calif. - Some residents of Silicon Valley gathered at a town hall in Los Gatos to publicly call for U.S. Representative Anna Eshoo (D) to support a ceasefire in Gaza. The Gaza Health Ministry estimates nearly 22,000 Palestinians have been killed in the war since Oct. 7.

Organizers say they invited Representative Anna Eshoo to Thursday's town hall, but she did not attend. They want her to call for an end to the war in Gaza, and they say they’ll continue asking for her support until it happens.

"You can't be neutral. You’ve got to take a side and Anna Eshoo has to take a side," said one of the guest speakers.

Dozens of people from throughout Silicon Valley gathered for the town hall. The group says their goal is to make their voices and concerns heard by their local Representative Anna Eshoo. One man says he came to the town hall because dozens of his relatives are struggling to survive in Gaza.

"Knowing that my tax dollars go to fund this, going to fund the bombs that are dropped indiscriminately on civilians, hospitals, ambulances, schools, etc. It makes me feel unheard, unseen. It makes me feel alienated as a Palestinian, as a Muslim and as an American citizen," said Omar, of San Jose.

The Health Ministry in Gaza says as of Jan. 1, 21,968 Palestinians have been killed; 70% of them women and children. Displayed at the town hall, a banner lists the names of Palestinian children killed during the first three weeks of the war in Gaza.

"We just sent another lump sum of money, and we’re giving them the weapons and access to our weapons stores in Israel. This is ridiculous. She needs to call for an end to that right now," said Nickolas Saba, a resident of Silicon Valley.

Eshoo’s constituents also spoke about repeatedly calling and emailing Eshoo’s office and asking for meetings. They say they’ve met with Eshoo’s staffers and Eshoo sent this letter to the group Thursday, saying from the beginning, she’s called on Israel to show restraint and minimize civilian harm. She also said in November she called on Israel to implement a humanitarian pause in Gaza. Still, the group says they’re not satisfied with Eshoo’s response.

"Also, just debunking some of the content we’ve been seeing in her statements, which to be honest, has not been enough for the community to hear. We are tired, we’re exhausted, we’re in pain and Representative Eshoo is not representing us today," said Nadine, of San Jose.

The group says after the town hall, they’ll continue gathering, strategizing, and putting pressure on Eshoo to call for a ceasefire in Gaza.