Balancing act: Canadian North’s first Inuk CEO juggles Arctic airline challenges
The Canadian Press
Sun, May 12, 2024
In a colonnaded limestone building across from Parliament Hill, Shelly De Caria addressed a House of Commons committee on Wednesday as a chief executive for the first time in her 11-year airline career.
“I understand more than many what it means to struggle because of lack of access to affordable food as a child,” De Caria, who grew up in Nunavik in northern Quebec, told lawmakers.
“I remember the hardship and strain it caused, and most of all I remember going to bed hungry.”
De Caria has taken those memories with her to the top spot at Canadian North, where she stepped into the role in December.
She says her main focus will be doubling down on core services — scheduled flights that carry people, food and other essential goods to about 30 villages and cities, the vast majority of them accessible only by plane for much of the year — as the CEO looks to extend a lifeline to northern residents in need of air travel for health, education, business and tourism.
“This obviously can't be done overnight,” she said in an interview.
De Caria faces a raft of challenges. A pilot shortage and dearth of federal funding are two big obstacles, while weather and infrastructure difficulties particular to the North pose further problems.
With carriers’ flight volumes above the 60th parallel hovering below pre-pandemic levels, Canadian North’s first Inuk CEO now bears the task of balancing those financial and logistical challenges with the needs of communities for which she feels a deep affinity.
Born and raised in Kuujjuaq, Que., in the 1980s, De Caria experienced first-hand the limits on transport familiar to many Inuit communities, most of which rely on planes as their sole connection to the rest of the country for much of the year.
She joined First Air — later to merge with Canadian North — as a sales manager in 2013 partly because it allowed frequent travel back home to Nunavik from its headquarters in Ottawa. At that carrier, she helped develop community investment programs that targeted education, nutrition and mental health.
Since the COVID-19 pandemic wound down, old impediments have resurfaced with a vengeance, including labour shortages, government funding, snowstorms and gravel runways.
“We need to operate to the smallest communities, and not having pilots has been a big challenge,” said De Caria, noting that the shortage is not unique to Canadian North.
Some took off for WestJet last year after it signed a new collective agreement with pilots that featured big pay gains, she said.
The company has also struggled to make up for an end to the funding it drew from federal coffers during COVID-19, when its routes to 21 isolated communities were temporarily deemed an essential service and granted federal subsidies.
“We are the lifeline to the medical patients. The only way down to Ottawa — or Montreal, Winnipeg, Edmonton — is by plane,” De Caria said. She said she hopes to see more federal investment in northern airport upgrades that would allow for more efficient airline operations.
Infrastructure remains a big issue, with short, unpaved runways limiting the type of aircraft that can touch down.
“I can’t land a jet into, say, Cambridge Bay, because the gravel would go into the engine,” she noted. That means the airline has to fly smaller planes more frequently into some communities, at a cost to efficiency.
“Our margins continue to shrink,” De Caria told the Commons committee, saying a one per cent profit on cargo shipments is typical.
Meanwhile, repair and maintenance for the 36-plane fleetoften lie out of reach thousands of kilometres away.
“If you need a filter change and you’re in Iqaluit, there aren’t a lot of spare parts hanging around. You have to fly that spare part into that community,” said John Gradek, who teaches at McGill University's aviation management program.
He pointed to the cautionary tale of First Air, which joined forces with Canadian North in 2019.
“First Air spent a lot of money building up a lot of inventory across their network to support scheduled services,” he said. “And that overhead is why First Air didn't make it.”
The lower-tech instrumentation of most northern airports and turboprop planes also means aircraft cannot land in low visibility — a problem in snow-laden regions prone to a low cloud ceiling and long nights at certain times of the year.
“The volumes are low, the distances are long and the weather is unpredictable,” said Gradek, summing up the tough business case.
Balancing business priorities and social prerogatives amount to a daunting tightrope walk, but one De Caria is apt to take on, said Natan Obed.
The Inuit leader recalled De Caria’s commitment to her community during her three years at Inuit Tapiriit Kanatami, the national advocacy organization Obed heads. She served as its youth coordinator from 2007 to 2010, handling files that ranged from mental health and suicide prevention to education, language and culture.
“Her being an Inuk in this role, for all of the people that know that she is there defending her community and also pushing for the success of Canadian North, is really empowering to a lot of Inuit,” Obed said.
The potential for friction remains, however, including over prices and a lack of competition.
Since it merged with First Air, Canadian North has flown far fewer scheduled flights than the two did collectively before 2019. Its flight volume last year sat at less than half of the carriers’ combined levels from 2018, according to figures from aviation data firm Cirium. The tally is much closer if charter flights are included, according to Canadian North.
“There are ongoing tensions, because airlines that service Inuit Nunangat communities have very high prices in relation to similar distances in the south,” Obed said.
Fares for a two-way Iqaluit-Ottawa trip often top $2,000, he noted, though Canadian North tickets can also be found for under $1,000.
“Canadian North largely serves Inuit and Inuit communities, and it's not in its best interest to alienate its paying customers,” said Obed.
“There are just these systemic challenges, and what we see as the output is uncomfortable in many ways, which in the end makes Shelly’s job very difficult — to manage all the expectations while also doing her best to manage the institution of Canadian North.”
De Caria said she initially “downplayed” her achievement as the first Inuk CEO of the Inuit-owned airline, but has since embraced it.
“I recently flew to Iqaluit and I saw how important it was for not only Inuit, but women as well,” she said.
She highlighted Gov. Gen. Mary Simon, who is also from Kuujjuaq, as a source of guidance who blazed a trail for younger generations.
“I feel like she's inspired me, but now I can inspire others to dream big,” De Caria said.
“My husband’s a pilot, and my daughter often sees how big a pilot is to everyone who we speak to. But more recently, she's like, ‘No, my dad’s a pilot, but my mom’s president and CEO.’”
This report by The Canadian Press was first published May 12, 2024.
Christopher Reynolds, The Canadian Press
It’s possible that I shall make an ass of myself. But in that case one can always get out of it with a little dialectic. I have, of course, so worded my proposition as to be right either way (K.Marx, Letter to F.Engels on the Indian Mutiny)
Sunday, May 12, 2024
Pembina Pipeline says potential Trans Mountain purchase not a priority
The Canadian Press
Fri, May 10, 2024
CALGARY — Exploring a potential purchase of the Trans Mountain oil pipeline is not a major priority right now for Pembina Pipeline Corp., the Calgary-based company said.
On a conference call with analysts to discuss first-quarter financial results, Pembina's chief financial officer Cameron Goldade acknowledged the recent completion of the $34 billion Trans Mountain expansion, which marked its official opening last week.
But he reiterated Pembina's previously stated stance that there are still too many questions surrounding the pipeline to support pursuing a purchase at this point.
"From our perspective, there still exists a tremendous amount of uncertainty around that asset. And so you know, frankly, nothing has changed from our prior messaging in terms of that as an investment opportunity," Goldade said on Friday.
"It's not something we're spending a great deal of time on right now."
Pembina formed a partnership in 2021 with Western Indigenous Pipeline Group for the purpose of pursuing an Indigenous-led equity stake in Trans Mountain.
The pipeline is currently owned by the federal government, which bought it in 2018 to get the expansion project over the finish line.
But the government has said it does not wish to be the long-term owner and has already launched the first of what is expected to be a two-phase divestment process.
Pembina is not eligible to participate in this first phase, which involves talks with more than 120 Indigenous nations located along the Trans Mountain route to see if any of them are interested in an equity stake.
The second phase, for which the timing is unclear, will involve the consideration of commercial offers.
Some analysts have suggested Pembina would be the most logical buyer for the 890,000-barrel-per-day pipeline, which opens up new global export markets for Canadian oil companies.
But during the course of the four years it took to construct the mega-project, the pipeline expansion ran into multiple regulatory snags, delays and budget overruns.
And even though the project is complete, the Crown corporation that built it is still locked in a dispute with oil companies over the tolls it wishes to charge to use the pipeline.
Tolls are the way a pipeline earns revenue, so the final tolling structure for Trans Mountain will directly impact the pipeline's value as well as the price a prospective buyer is willing to pay.
Trans Mountain is looking to charge higher tolls to offset some of the project's budget overruns, but oil companies don't want to be held responsible for construction-related challenges.
The Canada Energy Regulator has approved Trans Mountain's proposed higher tolls on an interim basis to ensure a tolling structure was in place for the start-up of the pipeline, but it has yet to make a final decision.
Pembina's comments on Trans Mountain came one day after the company announced it earned $439 million in the first quarter, up from $369 million a year earlier.
Pembina said its revenue for the quarter ended March 31 was $1.54 billion, down from $1.62 billion during the same quarter last year.
Diluted earnings per common share were 73 cents, up from 61 cents.
During the quarter, Pembina entered into long-term agreements with Dow Chemical to supply and transport up to 50,000 barrels per day of ethane to support the recently announced construction of Dow's new integrated ethylene cracker and derivatives facility in Fort Saskatchewan, Alta.
Pembina and its project partner, the Haisla Nation of B.C., also announced recently that they have achieved a number of positive milestones on Cedar LNG, a proposed floating liquefied natural gas facility to be built near Kitimat.
Pembina said a final investment decision on Cedar LNG will be made by June 2024.
This report by The Canadian Press was first published May 10, 2024.
Companies in this story: (TSX:PPL)
Amanda Stephenson, The Canadian Press
The Canadian Press
Fri, May 10, 2024
CALGARY — Exploring a potential purchase of the Trans Mountain oil pipeline is not a major priority right now for Pembina Pipeline Corp., the Calgary-based company said.
On a conference call with analysts to discuss first-quarter financial results, Pembina's chief financial officer Cameron Goldade acknowledged the recent completion of the $34 billion Trans Mountain expansion, which marked its official opening last week.
But he reiterated Pembina's previously stated stance that there are still too many questions surrounding the pipeline to support pursuing a purchase at this point.
"From our perspective, there still exists a tremendous amount of uncertainty around that asset. And so you know, frankly, nothing has changed from our prior messaging in terms of that as an investment opportunity," Goldade said on Friday.
"It's not something we're spending a great deal of time on right now."
Pembina formed a partnership in 2021 with Western Indigenous Pipeline Group for the purpose of pursuing an Indigenous-led equity stake in Trans Mountain.
The pipeline is currently owned by the federal government, which bought it in 2018 to get the expansion project over the finish line.
But the government has said it does not wish to be the long-term owner and has already launched the first of what is expected to be a two-phase divestment process.
Pembina is not eligible to participate in this first phase, which involves talks with more than 120 Indigenous nations located along the Trans Mountain route to see if any of them are interested in an equity stake.
The second phase, for which the timing is unclear, will involve the consideration of commercial offers.
Some analysts have suggested Pembina would be the most logical buyer for the 890,000-barrel-per-day pipeline, which opens up new global export markets for Canadian oil companies.
But during the course of the four years it took to construct the mega-project, the pipeline expansion ran into multiple regulatory snags, delays and budget overruns.
And even though the project is complete, the Crown corporation that built it is still locked in a dispute with oil companies over the tolls it wishes to charge to use the pipeline.
Tolls are the way a pipeline earns revenue, so the final tolling structure for Trans Mountain will directly impact the pipeline's value as well as the price a prospective buyer is willing to pay.
Trans Mountain is looking to charge higher tolls to offset some of the project's budget overruns, but oil companies don't want to be held responsible for construction-related challenges.
The Canada Energy Regulator has approved Trans Mountain's proposed higher tolls on an interim basis to ensure a tolling structure was in place for the start-up of the pipeline, but it has yet to make a final decision.
Pembina's comments on Trans Mountain came one day after the company announced it earned $439 million in the first quarter, up from $369 million a year earlier.
Pembina said its revenue for the quarter ended March 31 was $1.54 billion, down from $1.62 billion during the same quarter last year.
Diluted earnings per common share were 73 cents, up from 61 cents.
During the quarter, Pembina entered into long-term agreements with Dow Chemical to supply and transport up to 50,000 barrels per day of ethane to support the recently announced construction of Dow's new integrated ethylene cracker and derivatives facility in Fort Saskatchewan, Alta.
Pembina and its project partner, the Haisla Nation of B.C., also announced recently that they have achieved a number of positive milestones on Cedar LNG, a proposed floating liquefied natural gas facility to be built near Kitimat.
Pembina said a final investment decision on Cedar LNG will be made by June 2024.
This report by The Canadian Press was first published May 10, 2024.
Companies in this story: (TSX:PPL)
Amanda Stephenson, The Canadian Press
China EV Maker Zeekr Shares Climb 35% After Expanded US IPO
Amy Or and Michael Hytha
Fri, May 10, 2024
China EV Maker Zeekr Shares Climb 35% After Expanded US IPO
(Bloomberg) -- Shares of Zeekr Intelligent Technology Holding Ltd., the high-end electric car brand under Zhejiang Geely Holding Group Co., rose 35% after an expanded initial public offering that’s the biggest US listing by a China-based company since 2021.
Zeekr’s American depositary shares closed at $28.26 apiece on Friday in New York, giving the company a value of about $6.9 billion. The company on Thursday raised $441 million from the sale of 21 million ADS priced at the top of a marketed range of $18 to $21.
Underwriters have an option to purchase as many as 3.15 million more ADSs in an over-allotment option, which if exercised in full will lift the offering to 24.15 million ADSs, representing about 9.1% of Zeekr’s issued share capital, according to an earlier statement.
Geely Auto, Mobileye Global Inc. and Contemporary Amperex Technology Co. Ltd. were interested in subscribing for as much as $349 million worth of shares in the offering, Zeekr had said in its filings.
Zeekr’s offering adds to a US IPO market rebound that is steadily overtaking the lackluster volumes of the past two years. The roughly $17 billion raised via listings on US exchanges since Jan. 1 compares with less than $10 billion at this point last year, with close to half of 2023’s volume coming from a single blockbuster, Johnson & Johnson’s spinoff Kenvue Inc., according to data compiled by Bloomberg.
Biggest Since Didi
The listing by Zeekr is the biggest by a China-based firm in the US since Didi Global Inc.’s $4.4 billion IPO almost three years ago. Days after the ride-hailing firm went public, it became the subject of investigation by Chinese regulators and delisted from the New York Stock Exchange less than a year later. The crackdown that ensued after Didi’s IPO, which spread to wide swaths of the country’s tech sector, crushed both share prices and US IPO activity.
Since then, listings on New York exchanges by China-based companies have been small and rare.
Zeekr’s valuation suffered in the aftermath, too. The company said in February 2023 that it had been valued at $13 billion in a funding.
Overcapacity in its domestic market also afflicts Zeekr and others such as BYD Co., leaving them eager to boost sales overseas. Zeekr warned investors in its prospectus that the Chinese government could intervene in its business to further its own regulatory, political and societal goals.
Zeekr founder and Chairman Li Shufu will control about 75% of the shareholder voting power in the company after the IPO, according to the filings. He now presides over an empire that includes two other EV makers that are publicly traded in the US, as well as Volvo Car AB in Stockholm.
Lotus, Polestar
In February, Geely took automaker Lotus Technology Inc. public via a merger with a special purpose acquisition company. That followed Geely’s Polestar Automotive Holding going public in a SPAC deal in 2022, and the listing of Volvo Car the previous year.
Last year, Zeekr had a net loss of $1.16 billion on about $7.3 billion in revenue, with the latter increasing more than 60% from 2022, according to its filings.
Read More: Chinese Tycoon With Mercedes, Volvo Stakes Struggles Against BYD
The Zeekr lineup includes the 001, a five-seat crossover and the X, a compact sport utility vehicle. The brand has also launched the 007, a premium sedan.
The IPO was led by Goldman Sachs Group Inc., Morgan Stanley, Bank of America Corp. and China International Capital Corp. The company’s shares are trading on the New York Stock Exchange under the symbol ZK.
(Updates in first and second paragraphs with closing price.)
Most Read from Bloomberg Businessweek
Amy Or and Michael Hytha
Fri, May 10, 2024
China EV Maker Zeekr Shares Climb 35% After Expanded US IPO
(Bloomberg) -- Shares of Zeekr Intelligent Technology Holding Ltd., the high-end electric car brand under Zhejiang Geely Holding Group Co., rose 35% after an expanded initial public offering that’s the biggest US listing by a China-based company since 2021.
Zeekr’s American depositary shares closed at $28.26 apiece on Friday in New York, giving the company a value of about $6.9 billion. The company on Thursday raised $441 million from the sale of 21 million ADS priced at the top of a marketed range of $18 to $21.
Underwriters have an option to purchase as many as 3.15 million more ADSs in an over-allotment option, which if exercised in full will lift the offering to 24.15 million ADSs, representing about 9.1% of Zeekr’s issued share capital, according to an earlier statement.
Geely Auto, Mobileye Global Inc. and Contemporary Amperex Technology Co. Ltd. were interested in subscribing for as much as $349 million worth of shares in the offering, Zeekr had said in its filings.
Zeekr’s offering adds to a US IPO market rebound that is steadily overtaking the lackluster volumes of the past two years. The roughly $17 billion raised via listings on US exchanges since Jan. 1 compares with less than $10 billion at this point last year, with close to half of 2023’s volume coming from a single blockbuster, Johnson & Johnson’s spinoff Kenvue Inc., according to data compiled by Bloomberg.
Biggest Since Didi
The listing by Zeekr is the biggest by a China-based firm in the US since Didi Global Inc.’s $4.4 billion IPO almost three years ago. Days after the ride-hailing firm went public, it became the subject of investigation by Chinese regulators and delisted from the New York Stock Exchange less than a year later. The crackdown that ensued after Didi’s IPO, which spread to wide swaths of the country’s tech sector, crushed both share prices and US IPO activity.
Since then, listings on New York exchanges by China-based companies have been small and rare.
Zeekr’s valuation suffered in the aftermath, too. The company said in February 2023 that it had been valued at $13 billion in a funding.
Overcapacity in its domestic market also afflicts Zeekr and others such as BYD Co., leaving them eager to boost sales overseas. Zeekr warned investors in its prospectus that the Chinese government could intervene in its business to further its own regulatory, political and societal goals.
Zeekr founder and Chairman Li Shufu will control about 75% of the shareholder voting power in the company after the IPO, according to the filings. He now presides over an empire that includes two other EV makers that are publicly traded in the US, as well as Volvo Car AB in Stockholm.
Lotus, Polestar
In February, Geely took automaker Lotus Technology Inc. public via a merger with a special purpose acquisition company. That followed Geely’s Polestar Automotive Holding going public in a SPAC deal in 2022, and the listing of Volvo Car the previous year.
Last year, Zeekr had a net loss of $1.16 billion on about $7.3 billion in revenue, with the latter increasing more than 60% from 2022, according to its filings.
Read More: Chinese Tycoon With Mercedes, Volvo Stakes Struggles Against BYD
The Zeekr lineup includes the 001, a five-seat crossover and the X, a compact sport utility vehicle. The brand has also launched the 007, a premium sedan.
The IPO was led by Goldman Sachs Group Inc., Morgan Stanley, Bank of America Corp. and China International Capital Corp. The company’s shares are trading on the New York Stock Exchange under the symbol ZK.
(Updates in first and second paragraphs with closing price.)
Most Read from Bloomberg Businessweek
Tesla’s Autopilot caused a fiery crash into a tree, killing a Colorado man, lawsuit says
Fri, May 10, 2024
DENVER (AP) — The widow of a man who died after his Tesla veered off the road and crashed into a tree while he was using its partially automated driving system is suing the carmaker, claiming its marketing of the technology is dangerously misleading.
The Autopilot system prevented Hans Von Ohain from being able to keep his Model 3 Tesla on a Colorado road in 2022, according to the lawsuit filed by Nora Bass in state court on May 3. Von Ohain died after the car hit a tree and burst into flames, but a passenger was able to escape, the suit says.
Von Ohain was intoxicated at the time of the crash, according to a Colorado State Patrol report.
The Associated Press sent an email to Tesla's communications department seeking comment Friday.
Tesla offers two partially automated systems, Autopilot and a more sophisticated “Full Self Driving,” but the company says neither can drive itself, despite their names.
The lawsuit, which was also filed on behalf of the only child of Von Ohain and Bass, alleges that Tesla, facing financial pressures, released its Autopilot system before it was ready to be used in the real world. It also claims the company has had a “reckless disregard for consumer safety and truth," citing a 2016 promotional video.
“By showcasing a Tesla vehicle navigating traffic without any hands on the steering wheel, Tesla irresponsibly misled consumers into believing that their vehicles possessed capabilities far beyond reality,” it said of the video.
Last month, Tesla paid an undisclosed amount of money to settle a separate lawsuit that made similar claims, brought by the family of a Silicon Valley engineer who died in a 2018 crash while using Autopilot. Walter Huang's Model X veered out of its lane and began to accelerate before barreling into a concrete barrier located at an intersection on a busy highway in Mountain View, California.
Evidence indicated that Huang was playing a video game on his iPhone when he crashed into the barrier on March 23, 2018. But his family claimed Autopilot was promoted in a way that caused vehicle owners to believe they didn’t have to remain vigilant while they were behind the wheel.
U.S. auto safety regulators pressured Tesla into recalling more than 2 million vehicles in December to fix a defective system that’s supposed to make sure drivers pay attention when using Autopilot.
In a letter to Tesla posted on the agency’s website this week, U.S. National Highway Traffic Safety Administration investigators wrote that they could not find any difference in the warning software issued after the recall and the software that existed before it. The agency says Tesla has reported 20 more crashes involving Autopilot since the recall.
Colleen Slevin, The Associated Press
Fri, May 10, 2024
DENVER (AP) — The widow of a man who died after his Tesla veered off the road and crashed into a tree while he was using its partially automated driving system is suing the carmaker, claiming its marketing of the technology is dangerously misleading.
The Autopilot system prevented Hans Von Ohain from being able to keep his Model 3 Tesla on a Colorado road in 2022, according to the lawsuit filed by Nora Bass in state court on May 3. Von Ohain died after the car hit a tree and burst into flames, but a passenger was able to escape, the suit says.
Von Ohain was intoxicated at the time of the crash, according to a Colorado State Patrol report.
The Associated Press sent an email to Tesla's communications department seeking comment Friday.
Tesla offers two partially automated systems, Autopilot and a more sophisticated “Full Self Driving,” but the company says neither can drive itself, despite their names.
The lawsuit, which was also filed on behalf of the only child of Von Ohain and Bass, alleges that Tesla, facing financial pressures, released its Autopilot system before it was ready to be used in the real world. It also claims the company has had a “reckless disregard for consumer safety and truth," citing a 2016 promotional video.
“By showcasing a Tesla vehicle navigating traffic without any hands on the steering wheel, Tesla irresponsibly misled consumers into believing that their vehicles possessed capabilities far beyond reality,” it said of the video.
Last month, Tesla paid an undisclosed amount of money to settle a separate lawsuit that made similar claims, brought by the family of a Silicon Valley engineer who died in a 2018 crash while using Autopilot. Walter Huang's Model X veered out of its lane and began to accelerate before barreling into a concrete barrier located at an intersection on a busy highway in Mountain View, California.
Evidence indicated that Huang was playing a video game on his iPhone when he crashed into the barrier on March 23, 2018. But his family claimed Autopilot was promoted in a way that caused vehicle owners to believe they didn’t have to remain vigilant while they were behind the wheel.
U.S. auto safety regulators pressured Tesla into recalling more than 2 million vehicles in December to fix a defective system that’s supposed to make sure drivers pay attention when using Autopilot.
In a letter to Tesla posted on the agency’s website this week, U.S. National Highway Traffic Safety Administration investigators wrote that they could not find any difference in the warning software issued after the recall and the software that existed before it. The agency says Tesla has reported 20 more crashes involving Autopilot since the recall.
Colleen Slevin, The Associated Press
Fri, May 10, 2024
JERUSALEM (AP) — A European naval force detained six suspected pirates on Friday after they opened fire on an oil tanker traveling through the Gulf of Aden, officials said, likely part of a growing number of piracy attacks emanating from Somalia.
The attack on the Marshall Islands-flagged Chrystal Arctic comes as Yemen's Houthi rebels have also been attacking ships traveling through the crucial waterway, the Red Sea and the Bab el-Mandeb Strait connecting them. The assaults have slowed commercial traffic through the key maritime route onward to the Suez Canal and the Mediterranean Sea.
The pirates shot at the tanker from a small ship “carrying weapons and ladders,” according to the British military's United Kingdom Maritime Trade Operations center, which oversees Mideast shipping routes. The pirates carried Kalashnikov-style rifles and rocket-propelled grenades, the private security firm Ambrey said.
The pirates opened fire first at the Chrystal Arctic, whose armed, onboard security team returned fire at them, the UKMTO said.
The pirates then abandoned their attempt to take the tanker, which continued on its way with all its crew safe, the UKMTO said. Dark black smoke came out of the small boat carrying the pirates, likely from a burning fuel drum, Ambrey said.
Hours later, the European Union naval force in the region known as Operation Atalanta said a frigate operating in the region detained six suspected pirates. The frigate seized the pirates given “the unsafe condition of their skiff” and said that some had “injuries of varied severity.”
It wasn't immediately clear if those injured suffered gunshot wounds from the exchange of fire with the Chrystal Arctic. The EU force declined to elaborate “due to the security of the operations.”
Ambrey identified the EU vessel as Italy's Carlo Bergamini-class frigate ITS Federico Martinego.
Once-rampant piracy off the Somali coast diminished after a peak in 2011. That year, there were 237 reported attacks in waters off Somalia. Somali piracy in the region at the time cost the world's economy some $7 billion — with $160 million paid out in ransoms, according to the Oceans Beyond Piracy monitoring group.
Increased naval patrols, a strengthening central government in Mogadishu, Somalia's capital, and other efforts saw the piracy beaten back.
However, concerns about new attacks have grown in recent months. In the first quarter of 2024, there have been five reported incidents off Somalia, according to the International Maritime Bureau.
“These incidents were attributed to Somali pirates who demonstrate mounting capabilities, targeting vessels at great distances, from the Somali coast,” the bureau warned in April. It added that there had been “several reported hijacked dhows and fishing vessels, which are ideal mother ships to launch attacks at distances from the Somali coastline.”
In March, the Indian navy detained dozens of pirates who seized a bulk carrier and took its 17 crew hostage. In April, pirates releases 23 crew members of the Bangladesh-flagged cargo carrier MV Abdullah after seizing the vessel. The terms of the release aren't immediately known.
These attacks come as the Houthi campaign targeting shipping since November as part of their pressure campaign to stop the Israel-Hamas war raging in the Gaza Strip.
Jon Gambrell, The Associated Press
\
Specialty lab exec gets 10-year prison term for 11 deaths from tainted steroids in Michigan
Fri, May 10, 2024
HOWELL, Mich. (AP) — A Michigan judge sentenced the former executive of a specialty pharmacy to at least 10 years in prison Friday for the deaths of 11 people who were injected with tainted pain medication, part of a meningitis outbreak that affected hundreds across the U.S. in 2012.
Barry Cadden's sentence for involuntary manslaughter will be served at the same time as his current 14 1/2-year federal sentence for crimes tied to the outbreak. As a result, he's not expected to spend any additional time behind bars — a deep disappointment for relatives of victims.
“This is hard because Mother's Day is just two days away,” said Gene Keyes, whose 79-year-old mother, Sally Roe, died 30 days after getting a tainted injection.
“Barry Cadden is responsible for the disintegration of our family. Our family has been torn apart,” Keyes told Livingston County Judge Matthew McGivney.
McGivney followed a sentencing agreement negotiated by Cadden's lawyer and the Michigan attorney general's office. Cadden had been charged with second-degree murder but pleaded no contest to involuntary manslaughter in March.
“You have altered the lives of these families and robbed them of time with their loved ones," the judge said.
More than 700 people in 20 states were sickened with meningitis or other debilitating illnesses and at least 64 died as a result of tainted steroids shipped to pain clinics in 2012 by New England Compounding Center in Framingham, Massachusetts, according to the U.S. Centers for Disease Control and Prevention.
But Michigan has been the only state to prosecute Cadden and a senior pharmacist, Glenn Chin, for any deaths.
Compounding pharmacies make versions of medications that often aren’t available through larger drugmakers. But Cadden’s lab was a mess, investigators said, leading to the growth of mold in the manufacturing process.
“There can be no doubt that you knew the risks that you were exposing innocent patients to and you chose, even after being investigated and sanctioned, to place your bottom line over innocent lives," McGivney said.
Cadden, 57, did not speak in court. The judge noted that a presentence officer who interviewed him in preparation for the hearing had written that Cadden showed no remorse.
In federal court in Boston in 2017, Cadden said he was sorry for the “whole range of suffering” that occurred.
“I feel like there's no justice," said Keyes, who wanted Cadden to serve more time in prison.
Assistant Attorney General Shawn Ryan declined to comment outside court when asked about the terms of the plea deal. The attorney general's office did not immediately respond to an email from The Associated Press.
Penny Laperriere said she had to sell her home after her husband, Lyn Laperriere, 61, died.
“Barry Cadden killed my husband. ... Mr. Cadden has no idea what I went through as he forced me into being a widow. Who does that to someone on purpose? All because of his greed,” Laperriere, 67, told the judge.
Karen Johnson said her mother, Betty Ruttman, lived another 10 years after getting sick, though her life wasn't the same. She attended the hearing “to have some closure.”
“It took her six months to get home,” Johnson, 67, said outside court, referring to her mother's stays in a hospital and rehabilitation center. “Not only did the victims go through hell, but the victims' families.”
Chin's second-degree murder case still is pending. He has not reached a deal with state prosecutors and will return to court on May 17. Meanwhile, he is serving a 10 1/2-year federal sentence.
___
Follow Ed White at https://twitter.com/edwritez
Chinese companies win licensing bids to explore Iraq oil and gas fields
Moayed Kenany, Timour Azhari and Adam Makary
Updated Sat, May 11, 2024
A representative of a foreign company drops his offer in a box during the fifth plus and sixth licensing rounds for 29 oil and gas exploration blocks at the Oil Ministry's headquarters in Baghdad
By Moayed Kenany, Timour Azhari and Adam Makary
BAGHDAD (Reuters) -Chinese companies won bids to explore five Iraqi oil and gas fields on Saturday in a licensing round for hydrocarbon exploration that was primarily aimed at ramping up gas production for domestic use.
An Iraqi Kurdish company also took two of the 29 projects up for grabs in the three-day licensing round across central, southern and western Iraq, which for the first time includes an offshore exploration block in the country's Arab Gulf waters.
Iraq aims to lure billions of dollars of investments to develop its oil and gas sector as it looks to ramp up local petrochemicals production and end imports of gas from neighbouring Iran that are currently key to producing power.
More than 20 companies pre-qualified for the licensing round, including European, Chinese, Arab and Iraqi groups.
There were notably no U.S. oil majors involved, even after Iraqi Prime Minister Mohammed Shia met with representatives of U.S. oil firms during an official visit to the United States last month.
Five bids were won on Saturday by Chinese companies.
Zhongman Petroleum and Natural Gas Group (ZPEC) took the northern extension of the Eastern Baghdad field, in Baghdad, and the Middle Euphrates field that straddles the southern Najaf and Karbala provinces, the oil ministry said.
China's United Energy Group Ltd won a bid to develop the Al-Faw field in southern Basra, while ZhenHua won a bid to develop Iraq's Qurnain field in the Iraqi-Saudi border region and Geo-Jade won a bid to develop Iraq's Zurbatiya field in the Wasit.
Two oil and gas fields were taken by Iraq's KAR Group - the Dimah field in eastern Maysan province, and the Sasan & Alan fields in Iraq's northwestern Nineveh province - the ministry said.
Around 20 more projects are open for bidding on Sunday and Monday.
Falah Al-amri, the Iraqi prime minister's advisor for oil and gas issues, said the government hoped the new projects would raise oil production to 6 million barrels per day by 2030 from around 5 million now.
The government also wants the projects to produce enough natural gas so that, along with plans to all-but eliminate gas flaring by 2030, Iraq could end imports.
"Its too early to talk about (gas) exports. We want to get self-sufficient," Al-amri told Reuters.
Iraq, OPEC's second-largest oil producer after Saudi Arabia, at one time had targeted becoming a rival to the Gulf Arab kingdom with output of over a tenth of global demand.
But its oil sector development has been hampered by contract terms viewed as unfavourable by many major oil companies as well as recurring conflict and political paralysis.
Growing investor focus in recent years on environmental, social and governance criteria have also had an effect.
Western oil giants such as Exxon Mobil Corp and Royal Dutch Shell Plc have departed from a number of projects in Iraq while Chinese companies have steadily expanded their footprint.
(Reporting by Moayed Kenany, Clauda Tanios, Adam Makary and Timour Azhari; Writing by Timour Azhari; Editing by Alison Williams, Mark Potter and Emelia SIthole-Matarise)
Moayed Kenany, Timour Azhari and Adam Makary
Updated Sat, May 11, 2024
A representative of a foreign company drops his offer in a box during the fifth plus and sixth licensing rounds for 29 oil and gas exploration blocks at the Oil Ministry's headquarters in Baghdad
By Moayed Kenany, Timour Azhari and Adam Makary
BAGHDAD (Reuters) -Chinese companies won bids to explore five Iraqi oil and gas fields on Saturday in a licensing round for hydrocarbon exploration that was primarily aimed at ramping up gas production for domestic use.
An Iraqi Kurdish company also took two of the 29 projects up for grabs in the three-day licensing round across central, southern and western Iraq, which for the first time includes an offshore exploration block in the country's Arab Gulf waters.
Iraq aims to lure billions of dollars of investments to develop its oil and gas sector as it looks to ramp up local petrochemicals production and end imports of gas from neighbouring Iran that are currently key to producing power.
More than 20 companies pre-qualified for the licensing round, including European, Chinese, Arab and Iraqi groups.
There were notably no U.S. oil majors involved, even after Iraqi Prime Minister Mohammed Shia met with representatives of U.S. oil firms during an official visit to the United States last month.
Five bids were won on Saturday by Chinese companies.
Zhongman Petroleum and Natural Gas Group (ZPEC) took the northern extension of the Eastern Baghdad field, in Baghdad, and the Middle Euphrates field that straddles the southern Najaf and Karbala provinces, the oil ministry said.
China's United Energy Group Ltd won a bid to develop the Al-Faw field in southern Basra, while ZhenHua won a bid to develop Iraq's Qurnain field in the Iraqi-Saudi border region and Geo-Jade won a bid to develop Iraq's Zurbatiya field in the Wasit.
Two oil and gas fields were taken by Iraq's KAR Group - the Dimah field in eastern Maysan province, and the Sasan & Alan fields in Iraq's northwestern Nineveh province - the ministry said.
Around 20 more projects are open for bidding on Sunday and Monday.
Falah Al-amri, the Iraqi prime minister's advisor for oil and gas issues, said the government hoped the new projects would raise oil production to 6 million barrels per day by 2030 from around 5 million now.
The government also wants the projects to produce enough natural gas so that, along with plans to all-but eliminate gas flaring by 2030, Iraq could end imports.
"Its too early to talk about (gas) exports. We want to get self-sufficient," Al-amri told Reuters.
Iraq, OPEC's second-largest oil producer after Saudi Arabia, at one time had targeted becoming a rival to the Gulf Arab kingdom with output of over a tenth of global demand.
But its oil sector development has been hampered by contract terms viewed as unfavourable by many major oil companies as well as recurring conflict and political paralysis.
Growing investor focus in recent years on environmental, social and governance criteria have also had an effect.
Western oil giants such as Exxon Mobil Corp and Royal Dutch Shell Plc have departed from a number of projects in Iraq while Chinese companies have steadily expanded their footprint.
(Reporting by Moayed Kenany, Clauda Tanios, Adam Makary and Timour Azhari; Writing by Timour Azhari; Editing by Alison Williams, Mark Potter and Emelia SIthole-Matarise)
CLIMATE SABOTAGE CONFRONTATION
'I am angry': Alberta farmers will continue fight over world class motorsport resort
The Canadian Press
Sat, May 11, 2024
ROSEBUD, ALBERTA — The rolling hills leading to the hamlet of Rosebud are dotted with sprawling farms and cattle pastures -- and a sign sporting a simple message: No Race Track.
Near that sign is another one telling would-be trespassers to stay off raceway property.
That sign is riddled with bullet holes, a pockmarked symbol of an 11-year battle pitting local landowners against a motorsport family determined to realize a dream of world-class racing.
The dream began in 2006 when Badlands Motorsports Resort purchased 194 hectares of prime land along the Rosebud River valley, northeast of Calgary.
The plan is to build a $500-million racing park for street-legal machines. There will be multiple racetracks, a go-kart track, a hotel and condominiums.
Some local landowners want no part o it.
"I am angry that we have to put our community through this. It's not right. It should never have gotten this far," said Wendy Clark.
"We actually couldn't believe that somebody would want to have property here and not enjoy it for the natural value that it has.”
Clark made the comments in an interview alongside husband Richard and neighbour Rick Skibsted.
They have Rosebud in the blood: Richard and Rick were born and raised there, while Wendy Clark has been in the hamlet for 42 years.
Rosebud is a tourist draw in and of itself, known for its local theatre and pie shop.
On the other side of the long-simmering battle is a group of doctors, led by Calgary radiologist Dr. Jay Zelazo. They bought the property, five kilometres from Rosebud, to build a new raceway after the only track near Calgary was struggling to stay afloat.
"It was the only property that we found that was suitable,” said Zelazo's father James, who serves as Badlands' chief financial officer.
"It's our land and we've done what was required.”
He said there have been unexpected costs added to the $30-million price tag for the first phase of the project.
Zelazo said the company has to pave a 10-kilometre stretch of narrow, winding road to the site itself at a cost of $15 million.
Zelazo said the constant delays are frustrating.
"It's the financing that we need to get. It's nothing else. We have all the approvals," he said.
"It's disheartening (that opponents) won't accept what the county made sure we did, meeting the bylaw requirements and all the documents just because they don't want it."
Opponents were concerned that filling in two wetlands to build the track would harm birds such as bank swallows, eagles, hawks and falcons.
Alberta’s Environmental Appeals Board dismissed that concern in March for lack of evidence and Environment Minister Rebecca Schulz later agreed with that decision.
But Schulz noted the board did order environmental monitoring and field surveys.
“They wanted to see some additional mitigation done to protect wetlands," Schulz recently told reporters.
"I did accept that."
Skibsted said swallows are already getting hit by cars and trucks and says the proposed racetrack will make things worse, coming between the birds and their food source.
The Alberta Wilderness Association said its concerns about the racetrack are more about the location than the project itself.
Conservation specialist Kennedy Halvorson said about three-quarters of the natural grassland in the Rosebud River valley is already gone due to human activity.
"It's kind of one of the last areas of the grasslands that's super healthy and has a lot of biodiversity. It's also home to about 85 per cent of Alberta's species at risk and the Rosebud River is no different," Halvorson said.
Opponents say there can still be a win-win, that a fair offer is on the table if Badlands wants to sell the land.
"We would pay what it's worth. It's increased in value. We'll provide a fair and equitable exit,” said Richard Clark.
If it’s no sale, the next step might be court, perhaps a judicial review of the environmental board decision.
"We've still got some more tools in our tool kit," said Wendy Clark.
"We're not done yet.
“And we're pretty patient."
This report by The Canadian Press was first published May 11, 2024.
— With files from Bob Weber in Edmonton
Bill Graveland, The Canadian Press
'I am angry': Alberta farmers will continue fight over world class motorsport resort
The Canadian Press
Sat, May 11, 2024
ROSEBUD, ALBERTA — The rolling hills leading to the hamlet of Rosebud are dotted with sprawling farms and cattle pastures -- and a sign sporting a simple message: No Race Track.
Near that sign is another one telling would-be trespassers to stay off raceway property.
That sign is riddled with bullet holes, a pockmarked symbol of an 11-year battle pitting local landowners against a motorsport family determined to realize a dream of world-class racing.
The dream began in 2006 when Badlands Motorsports Resort purchased 194 hectares of prime land along the Rosebud River valley, northeast of Calgary.
The plan is to build a $500-million racing park for street-legal machines. There will be multiple racetracks, a go-kart track, a hotel and condominiums.
Some local landowners want no part o it.
"I am angry that we have to put our community through this. It's not right. It should never have gotten this far," said Wendy Clark.
"We actually couldn't believe that somebody would want to have property here and not enjoy it for the natural value that it has.”
Clark made the comments in an interview alongside husband Richard and neighbour Rick Skibsted.
They have Rosebud in the blood: Richard and Rick were born and raised there, while Wendy Clark has been in the hamlet for 42 years.
Rosebud is a tourist draw in and of itself, known for its local theatre and pie shop.
On the other side of the long-simmering battle is a group of doctors, led by Calgary radiologist Dr. Jay Zelazo. They bought the property, five kilometres from Rosebud, to build a new raceway after the only track near Calgary was struggling to stay afloat.
"It was the only property that we found that was suitable,” said Zelazo's father James, who serves as Badlands' chief financial officer.
"It's our land and we've done what was required.”
He said there have been unexpected costs added to the $30-million price tag for the first phase of the project.
Zelazo said the company has to pave a 10-kilometre stretch of narrow, winding road to the site itself at a cost of $15 million.
Zelazo said the constant delays are frustrating.
"It's the financing that we need to get. It's nothing else. We have all the approvals," he said.
"It's disheartening (that opponents) won't accept what the county made sure we did, meeting the bylaw requirements and all the documents just because they don't want it."
Opponents were concerned that filling in two wetlands to build the track would harm birds such as bank swallows, eagles, hawks and falcons.
Alberta’s Environmental Appeals Board dismissed that concern in March for lack of evidence and Environment Minister Rebecca Schulz later agreed with that decision.
But Schulz noted the board did order environmental monitoring and field surveys.
“They wanted to see some additional mitigation done to protect wetlands," Schulz recently told reporters.
"I did accept that."
Skibsted said swallows are already getting hit by cars and trucks and says the proposed racetrack will make things worse, coming between the birds and their food source.
The Alberta Wilderness Association said its concerns about the racetrack are more about the location than the project itself.
Conservation specialist Kennedy Halvorson said about three-quarters of the natural grassland in the Rosebud River valley is already gone due to human activity.
"It's kind of one of the last areas of the grasslands that's super healthy and has a lot of biodiversity. It's also home to about 85 per cent of Alberta's species at risk and the Rosebud River is no different," Halvorson said.
Opponents say there can still be a win-win, that a fair offer is on the table if Badlands wants to sell the land.
"We would pay what it's worth. It's increased in value. We'll provide a fair and equitable exit,” said Richard Clark.
If it’s no sale, the next step might be court, perhaps a judicial review of the environmental board decision.
"We've still got some more tools in our tool kit," said Wendy Clark.
"We're not done yet.
“And we're pretty patient."
This report by The Canadian Press was first published May 11, 2024.
— With files from Bob Weber in Edmonton
Bill Graveland, The Canadian Press
MAIN STREET VS WALL STREET
Josh Schafer
·Reporter
Updated Fri, May 10, 2024
US consumers are becoming increasingly worried about the trajectory of the US economy amid sticky inflation and the prospect of high interest rates for longer than initially hoped.
The latest University of Michigan consumer sentiment survey released Friday revealed a 13% decline in overall sentiment during the month of May. The index reading for the month came in at 67.4, its lowest level in six months, and well below economist expectations for a reading of 76.2.
Year-ahead inflation expectations hit 3.5% in Friday's report, up from 3.2% in the month prior. Longer-run inflation expectations rose to 3.1%, up from 3% the month prior.
"While consumers had been reserving judgment for the past few months, they now perceive negative developments on a number of dimensions," survey of consumers director Joanne Hsu said in a statement. "They expressed worries that inflation, unemployment and interest rates may all be moving in an unfavorable direction in the year ahead."
The drop in sentiment comes after several months of data showing that inflation's downward path hasn't been as smooth as many economists had hoped. Through the first three months of the year the core Personal Consumption Expenditures (PCE) index, which strips out the cost of food and energy and is closely watched by the Federal Reserve, rose at an annualized pace of 4.4%. This tracked significantly higher than the Fed's 2% goal, reversing a trend of significant easing in inflation to end 2023.
And while Powell said it's "unlikely" the next move for the Fed is an interest rate hike, the sticky inflation data appears to have put the Fed on a path to hold off on rate cuts longer than markets had hoped entering the year.
Meanwhile, various economic data releases have come in tepid, such as the most recent weaker-than-expected jobs report and data showing a contraction in manufacturing activity in April. On Thursday, weekly jobless claims rose unexpectedly, hitting their highest level since August 2023.
Friday's University of Michigan release follows a recent reading of consumer confidence from the Conference Board that showed confidence in April hit its lowest level since July 2022.
Powell has talked extensively about how consumer sentiment around inflation is something the central bank watches and will play a role in inflation returning to the 2% goal.
"For us to begin to reduce policy restriction, we'd want to be confident that inflation is moving sustainably down to 2%," Powell said on May 1. "And for sure one of the things we'd be looking at is the performance of inflation. We'd also be looking at inflation expectations, we'd be looking at the whole story, but clearly, incoming inflation data would be at the very heart of that decision."
Crucial readings on both inflation and consumer spending will come next week with retail sales and the Consumer Price Index for April, which are expected on Wednesday.
"In recent months, inflation has shown a lack of further progress toward our 2% objective, and we remain highly attentive to inflation risks," Federal Reserve Chair Jerome Powell said on May 1.
And while Powell said it's "unlikely" the next move for the Fed is an interest rate hike, the sticky inflation data appears to have put the Fed on a path to hold off on rate cuts longer than markets had hoped entering the year.
Meanwhile, various economic data releases have come in tepid, such as the most recent weaker-than-expected jobs report and data showing a contraction in manufacturing activity in April. On Thursday, weekly jobless claims rose unexpectedly, hitting their highest level since August 2023.
Friday's University of Michigan release follows a recent reading of consumer confidence from the Conference Board that showed confidence in April hit its lowest level since July 2022.
Powell has talked extensively about how consumer sentiment around inflation is something the central bank watches and will play a role in inflation returning to the 2% goal.
"For us to begin to reduce policy restriction, we'd want to be confident that inflation is moving sustainably down to 2%," Powell said on May 1. "And for sure one of the things we'd be looking at is the performance of inflation. We'd also be looking at inflation expectations, we'd be looking at the whole story, but clearly, incoming inflation data would be at the very heart of that decision."
Crucial readings on both inflation and consumer spending will come next week with retail sales and the Consumer Price Index for April, which are expected on Wednesday.
Supporters of United States look dejected after the FIFA World Cup Qatar 2022 Round of 16 match between Netherlands and USA at Khalifa International Stadium on Dec. 3, 2022, in Doha, Qatar. (Mohammad Karamali/DeFodi Images via Getty Images) (DeFodi Images via Getty Images)
Josh Schafer is a reporter for Yahoo Finance. Follow him on X @_joshschafer.
Josh Schafer is a reporter for Yahoo Finance. Follow him on X @_joshschafer.
The cost-of-living crisis is so bleak that some Gen Zers genuinely fear becoming homeless
Jane Thier
Sat, May 11, 2024
AsiaVision - Getty Images
There’s being cautious, and then there’s being terrified. When it comes to their financial outlook, many young adults have slipped into the second category.
That’s according to the Money Matters Report, a dense examination into American financial concerns published Thursday by saving and investing app Acorns. For the report, Acorns surveyed over 5,000 U.S. consumers about their attitudes and their concerns—and the results were dire.
Nearly a quarter of respondents said they’re actively concerned that the state of their finances could lead to homelessness. Broken down by generation, about a third of Gen Z and millennials said so, compared to just 11% of boomers.
Homelessness is an extreme outcome, but it’s not entirely beyond the scope of possibility. In December 2023, federal officials announced the U.S. experienced a 12% year-over-year increase in homelessness, bringing the nation to its highest reported level. The causes varied from impossibly steep rents, stagnant wages, and pandemic assistance payments sputtering to a stop.
As of six months ago, 653,000 people in the U.S. are homeless, which is the most ever tabulated since the country began conducting yearly data in 2007.
The main culprits behind the explosion in homelessness are “the shortage of affordable homes and the high cost of housing that have left many Americans living paycheck to paycheck and one crisis away from homelessness,” Jeff Olivet, executive director of the U.S. Interagency Council on Homelessness, said at the time.
That aligns with the findings in Acorns’ report; for workers across income brackets, the three biggest financial concerns are cost of living, inflation, and debt.
Long before the pandemic, America was gripped with shortages of affordable housing, everywhere from small rural towns to the economic city centers where most high-paying jobs can be found. Things have hardly improved since we took off our surgical masks.
As Fortune’s Alena Botros wrote, “since the pandemic-fueled housing boom, with both home prices and rents up substantially and mortgage rates at the highest level in decades, the single-family home has become much less accessible.” Indeed, rents still outpace salaries in 44 of the top 50 U.S. metropolitan areas.
Even for those who are gainfully employed, concerns overseas are becoming more difficult to ignore. Over half of respondents said macroeconomic events—like war and conflict—could further imperil their finances.
That’s to say nothing of the problems at home: a skyrocketing cost of living amid enduringly high inflation and debt. Many respondents, particularly younger ones, say they lack emergency funds, but fears over losing stability have nonetheless galvanized workers at all income levels to prioritize saving. Nearly 30% of respondents told Acorns they’ve never had an emergency fund to begin with, but among those who do have one, most say they’re upping their contributions, scared straight by the events unfolding around them.
Only around one-third of respondents said they expect to be more financially secure next year than they are now. Things generally skew more optimistic for the older crowd. The silent generation (which Acorns defines as those over 78 years old) were over twice as likely as the rest of the general population to claim they have no financial concerns at all.
"The everyday American is facing a deluge of bad financial news, from persistent increases in inflation to cost of living, all against a backdrop of global war and turmoil,” Noah Kerner, CEO of Acorns, wrote in the report. “What I'm encouraged by is that we can empirically confront the problem with a mix of education, tools, hope, and confidence.”
This story was originally featured on Fortune.com
Jane Thier
Sat, May 11, 2024
AsiaVision - Getty Images
There’s being cautious, and then there’s being terrified. When it comes to their financial outlook, many young adults have slipped into the second category.
That’s according to the Money Matters Report, a dense examination into American financial concerns published Thursday by saving and investing app Acorns. For the report, Acorns surveyed over 5,000 U.S. consumers about their attitudes and their concerns—and the results were dire.
Nearly a quarter of respondents said they’re actively concerned that the state of their finances could lead to homelessness. Broken down by generation, about a third of Gen Z and millennials said so, compared to just 11% of boomers.
Homelessness is an extreme outcome, but it’s not entirely beyond the scope of possibility. In December 2023, federal officials announced the U.S. experienced a 12% year-over-year increase in homelessness, bringing the nation to its highest reported level. The causes varied from impossibly steep rents, stagnant wages, and pandemic assistance payments sputtering to a stop.
As of six months ago, 653,000 people in the U.S. are homeless, which is the most ever tabulated since the country began conducting yearly data in 2007.
The main culprits behind the explosion in homelessness are “the shortage of affordable homes and the high cost of housing that have left many Americans living paycheck to paycheck and one crisis away from homelessness,” Jeff Olivet, executive director of the U.S. Interagency Council on Homelessness, said at the time.
That aligns with the findings in Acorns’ report; for workers across income brackets, the three biggest financial concerns are cost of living, inflation, and debt.
Long before the pandemic, America was gripped with shortages of affordable housing, everywhere from small rural towns to the economic city centers where most high-paying jobs can be found. Things have hardly improved since we took off our surgical masks.
As Fortune’s Alena Botros wrote, “since the pandemic-fueled housing boom, with both home prices and rents up substantially and mortgage rates at the highest level in decades, the single-family home has become much less accessible.” Indeed, rents still outpace salaries in 44 of the top 50 U.S. metropolitan areas.
Even for those who are gainfully employed, concerns overseas are becoming more difficult to ignore. Over half of respondents said macroeconomic events—like war and conflict—could further imperil their finances.
That’s to say nothing of the problems at home: a skyrocketing cost of living amid enduringly high inflation and debt. Many respondents, particularly younger ones, say they lack emergency funds, but fears over losing stability have nonetheless galvanized workers at all income levels to prioritize saving. Nearly 30% of respondents told Acorns they’ve never had an emergency fund to begin with, but among those who do have one, most say they’re upping their contributions, scared straight by the events unfolding around them.
Only around one-third of respondents said they expect to be more financially secure next year than they are now. Things generally skew more optimistic for the older crowd. The silent generation (which Acorns defines as those over 78 years old) were over twice as likely as the rest of the general population to claim they have no financial concerns at all.
"The everyday American is facing a deluge of bad financial news, from persistent increases in inflation to cost of living, all against a backdrop of global war and turmoil,” Noah Kerner, CEO of Acorns, wrote in the report. “What I'm encouraged by is that we can empirically confront the problem with a mix of education, tools, hope, and confidence.”
This story was originally featured on Fortune.com
Most Americans don’t expect to work into their mid-60s: Chart of the Week
Ethan Wolff-Mann
·Senior Editor
Sat, May 11, 2024 a
Among young workers who see getting on the hamster wheel of buying a home, saving some money, building some wealth, and retiring as an increasingly distant goal, one meme endures: I will never be able to stop working.
But new data from the New York Fed published this week showed the number of workers expecting to work beyond age 62 has plummeted.
Our Chart of the Week below shows the number of respondents to the New York Fed’s survey who expect to work beyond 62 fell to 45.8% in March, down from 55.4% four years ago. And just 31.2% of workers expect to work beyond 67 years old, down from 36.2% four years ago.
New York Fed economists found these expectations were represented broadly across age, education, and income demographics, though they were especially pronounced among women.
Ethan Wolff-Mann
·Senior Editor
Sat, May 11, 2024 a
Among young workers who see getting on the hamster wheel of buying a home, saving some money, building some wealth, and retiring as an increasingly distant goal, one meme endures: I will never be able to stop working.
But new data from the New York Fed published this week showed the number of workers expecting to work beyond age 62 has plummeted.
Our Chart of the Week below shows the number of respondents to the New York Fed’s survey who expect to work beyond 62 fell to 45.8% in March, down from 55.4% four years ago. And just 31.2% of workers expect to work beyond 67 years old, down from 36.2% four years ago.
New York Fed economists found these expectations were represented broadly across age, education, and income demographics, though they were especially pronounced among women.
The New York Fed doesn’t know why this change has happened. But the bank’s economists cite potential preferences to part-time or freelance employment, wealth, future earnings, and economic confidence, or — on the other side of the optimism ledger — a lack of confidence about making it to an expected age as factors influencing these results.
That the reasons can be both “YOLO” and its forward-thinking direct opposite only adds to the broader adoption of these expectations. But it also highlights the future’s complete opacity, especially in the face of a potential paradigm shift in work brought on by AI and automation across sectors. Innovations that could give us a 10-hour work week, or make us hungry.
Almost every chart mapping the labor market’s trajectory over the past five years is clearly shaped by the pandemic.
We saw a surge of joblessness and healing as businesses shut down and reopened. Then came “The Great Resignation,” when more people than usual decided to quit their jobs amid a post-pandemic hiring frenzy.
Both sides of this supply and demand reversal linger as contributors to the inflation conversation that defines this economic moment. And this precipitous shift in people’s retirement expectations could also reshape economic trends and recast known challenges into big problems.
“To the extent that these expectations signal actual future retirement behavior, they also have implications for future decisions by consumers about the timing of claims for social security benefits and the receipt of those benefits,” the New York Fed wrote.
A measured way to say that millions of people leaving the workforce earlier than expected will have a cost. And the bill may be due sooner than we think.
Ethan Wolff-Mann is a Senior Editor at Yahoo Finance, running newsletters. Follow him on Twitter @ewolffmann.
That the reasons can be both “YOLO” and its forward-thinking direct opposite only adds to the broader adoption of these expectations. But it also highlights the future’s complete opacity, especially in the face of a potential paradigm shift in work brought on by AI and automation across sectors. Innovations that could give us a 10-hour work week, or make us hungry.
Almost every chart mapping the labor market’s trajectory over the past five years is clearly shaped by the pandemic.
We saw a surge of joblessness and healing as businesses shut down and reopened. Then came “The Great Resignation,” when more people than usual decided to quit their jobs amid a post-pandemic hiring frenzy.
Both sides of this supply and demand reversal linger as contributors to the inflation conversation that defines this economic moment. And this precipitous shift in people’s retirement expectations could also reshape economic trends and recast known challenges into big problems.
“To the extent that these expectations signal actual future retirement behavior, they also have implications for future decisions by consumers about the timing of claims for social security benefits and the receipt of those benefits,” the New York Fed wrote.
A measured way to say that millions of people leaving the workforce earlier than expected will have a cost. And the bill may be due sooner than we think.
Ethan Wolff-Mann is a Senior Editor at Yahoo Finance, running newsletters. Follow him on Twitter @ewolffmann.
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