News
China’s Hits a Staggering 21.3 Percent Youth Unemployment Rate
China central government suspended the reporting of young unemployment statistics on Tuesday, as its central bank slashed a crucial interest rate to stimulate sagging economy.
A slew of disappointing numbers in recent months has shown a slowing of China’s post-COVID recovery, with youth unemployment reaching a new high of 21.3 percent in June.
The National Bureau of Statistics announced on Tuesday that it will no longer issue unemployment data by age group beginning this month, citing the need to “further improve and optimise labour force survey statistics.”
“The release of urban unemployment rates for youth and other age groups across the country will be suspended beginning this August,” National Bureau of Statistics spokeswoman Fu Linghui said at a press conference.
Many analysts have advocated for a large-scale recovery plan to increase activity as symptoms of an economic downturn have piled up in recent weeks. However, for the time being, authorities are focusing on selective initiatives and declarations of support for the private sector, with few concrete steps.
The central bank reduced the medium-term lending facility (MLF) rate, which is the interest rate on one-year loans to financial institutions, from 2.65 percent to 2.5 percent on Tuesday.
Lowering the MLF rate lowers commercial banks’ financing costs, enabling them to lend more and potentially increasing domestic consumption.
China’s Retail Growth is Slowing
The suspension of youth unemployment data came as Beijing announced a slew of dismal economic figures for July on Tuesday.
According to the National Bureau of Statistics, retail sales increased 2.5 percent year on year in July, down from 3.1 percent in June and falling short of expert projections.
In recent weeks, Chinese leaders have pushed to promote domestic consumption, with the State Council unveiling a 20-point plan last month to encourage consumers to spend more on industries such as autos, tourism, and household appliances.
The country’s senior officials have warned of “new difficulties and challenges” as well as “hidden dangers in key areas” for the economy.
According to the NBS, overall unemployment rose to 5.3 percent in July, up from 5.2 percent in June. According to the NBS, industrial production increased 3.7 percent year on year in July, down from 4.4 percent in June.
According to current data, China may struggle to meet its five percent growth objective for the year. According to official estimates, the world’s second-largest economy increased by only 0.8 percent during the first and second quarters of 2023.
China’s Financial Sector Takes a Hit
After failing to make payments on various high-yield investment packages, one of China’s leading private wealth managers has raised new concerns about the country’s shadow banking business.
The turbulence at Zhongzhi Enterprise Group Co, a shadowy financial conglomerate that oversees approximately 1 trillion yuan (US$138 billion), came to light when several of its corporate clients revealed late payments by a trust unit. According to persons familiar with the case, the banking regulator has formed a task team to investigate concerns at Zhongzhi, indicating that Chinese officials are concerned about potential contagion.
While poorly recognised outside of China, Zhongzhi is one of the country’s largest players in the $2.9 trillion trust business, which combines commercial and investment banking, private equity, and wealth management. Firms in the sector pool savings from high-net-worth individuals and corporations to make loans and invest in real estate, equities, bonds, and commodities.
Chinese trusts have been under scrutiny for years, ever since regulators began cracking down on the country’s shadow banking abuses in 2017. However, Zhongzhi’s problems have arisen at a particularly sensitive time for investors, many of whom are already concerned about the status of the world’s second-largest economy and property market.
Country Garden Holdings Co, one of the country’s top developers, is on the verge of bankruptcy, while loans given by Chinese banks plummeted to their lowest level since 2009 last month, indicating dwindling demand from businesses and consumers. Last year, Zhongzhi’s trust unit invested in real estate projects, depending on a market bounce that has yet to materialise.
Boosting investor confidence
The convergence of hazards is putting additional pressure on Xi Jinping’s leadership to boost investor confidence. The CSI 300 Index fell for the fifth time in six sessions on Monday, and the yuan slid towards its worst level this year.
While the revelation of the Zhongzhi task group provided some relief to markets, analysts at JPMorgan Chase & Co warned that the turbulence could add to a “vicious cycle” for real estate financing in China.
“The biggest problem now is how to isolate the risks associated with Zhongzhi group so that confidence in the entire trust industry does not collapse,” said Shen Meng, a director at Beijing-based Chanson & Co. “If the situation worsens, the scale of the risks will be no less than when a major property developer defaults.”
According to data provider Use Trust, 106 trust products totaling 44 billion yuan defaulted this year through July 31. By value, real estate investments accounted for 74%.
Three companies, including Zhongrong International Trust, stated late Friday that they had not received payments for items issued by entities affiliated to Zhongzhi. Xie Zhikun created Beijing-based Zhongzhi in 1995 and grew it into a vast empire. In 2021, Xie died of a heart attack, precisely as Covid-19 and pandemic lockdowns slowed China’s economy and exacerbated instability in its capital markets.
While his replacement, Liu Yang, has pledged to maintain the company’s strategic focus on industrial and asset management sectors, the economic recession and property-market fall have weighed on its operations.
Investors with outstanding investments
Zhongzhi is the second-largest shareholder in Zhongrong Trust, owning around 33% of the company. According to its website, the company also has shares in five other licenced financial institutions, including a mutual fund manager and two insurers, and has invested in five asset management companies and four wealth units. It also owns listed firms and has 4.5 billion tonnes of coal reserves among its industrial operations.
According to Use Trust data, Zhongrong Trust alone has 270 goods totalling 39.5 billion yuan due this year. The average yield on these products was 6.88%, compared to the bank’s benchmark one-year deposit rate of 1.5%. The trust corporation has revealed nothing to the public about its predicament, though it has stated that it is aware of fraudulent letters being circulated on social media claiming that the company is no longer in business.
According to a statement on its website, the corporation has denounced them to authorities. In one unsubstantiated letter circulating on social media, a wealth manager at Zhongzhi apologised to his clients, claiming the group’s wealth arms had decided to suspend payments on all products since mid-July. According to the letter, the problem involves more than 150,000 investors with outstanding investments totaling 230 billion yuan.
The extended property collapse in China has dragged previously sound property developers to their knees. The industry is trapped in a vicious loop in which faltering developers put off homebuyers, crimping companies’ financial flow. In July, home sales fell by the most in a year.
The missing payments demonstrate “how the real estate sector’s liquidity problem can cascade into other sectors, including the trust industry,” according to Gary Ng, senior economist at Natixis. “It would not be surprising to see more trusts with a high asset allocation towards real estate face payment issues.”
The National Financial Regulatory Authority, Zhongrong Trust, and its parent company, Zhongzhi Group, did not answer to demands for comment. In announcements issued Friday evening, Nacity Property Service Co. and KBC Corp. were the first to report on Zhongrong International Trust’s delayed payments. KBC, a carbon products manufacturer, claimed in a statement to the Shanghai Stock Exchange that the delayed payments were due to a 60 million yuan investment with Zhongrong Trust.
Another publicly traded firm announced on Friday that payments on one wealth product purchased from a Zhongzhi unit had fallen behind this month and that it would take legal action to recover investment losses.
According to its annual report for the year, Zhongrong Trust, which controlled 786 billion yuan in assets as of December 31, claimed its businesses faced a “relatively high level” of credit risks in 2022 as counterparties’ liquidity pressures and refinancing issues weakened their capacity to honour payments. According to Zhongrong Trust’s annual report, real estate accounted for 11% of trust assets, followed by industries (42%), and financial institutions (33%).
Regulators earlier punished the company 200,000 yuan for investing in a property project that lacked required approvals, and the company promised to enhance compliance. Last year, trust companies such China Zhongrong Trust and MinMetals Trust Co purchased holdings in at least ten real estate projects, anticipating that incomplete residences will eventually provide enough income to pay off some of the $230 billion in property-backed funds they offered to investors.
On Monday, China’s benchmark CSI 300 Index slid 0.7%, while Hong Kong’s Hang Seng China Enterprises Index sank 1.6%. The Chinese yuan fell 0.2% against the US dollar.
News
Trudeau’s Gun Grab Could Cost Taxpayers a Whopping $7 Billion
A recent report indicates that since Trudeau’s announcement of his gun buyback program four years ago, almost none of the banned firearms have been surrendered.
The federal government plans to purchase 2,063 firearm models from retailers following the enactment of Bill C-21, which amends various Acts and introduces certain consequential changes related to firearms. It was granted royal assent on December 15 of last year.
This ban immediately criminalized the actions of federally-licensed firearms owners regarding the purchase, sale, transportation, importation, exportation, or use of hundreds of thousands of rifles and shotguns that were previously legal.
The gun ban focused on what it termed ‘assault-style weapons,’ which are, in reality, traditional semi-automatic rifles and shotguns that have enjoyed popularity among hunters and sport shooters for over a century.
In May 2020, the federal government enacted an Order-in-Council that prohibited 1,500 types of “assault-style” firearms and outlined specific components of the newly banned firearms. Property owners must adhere to the law by October 2023.
Trudeau’s Buyback Hasn’t Happened
“In the announcement regarding the ban, the prime minister stated that the government would seize the prohibited firearms, assuring that their lawful owners would be ‘grandfathered’ or compensated fairly.” “That hasn’t happened,” criminologist Gary Mauser told Rebel News.
Mauser projected expenses ranging from $2.6 billion to $6.7 billion. The figure reflects the compensation costs amounting to $756 million, as outlined by the Parliamentary Budget Office (PBO).
“The projected expenses for gathering the illegal firearms are estimated to range from $1.6 billion to $7 billion.” “This range estimate increases to between $2.647 billion and $7 billion when compensation costs to owners are factored in,” Mauser stated.
Figures requested by Conservative MP Shannon Stubbs concerning firearms prohibited due to the May 1, 2020 Order In Council reveal that $72 million has been allocated to the firearm “buyback” program, yet not a single firearm has been confiscated to date.
In a recent revelation, Public Safety Canada disclosed that the federal government allocated a staggering $41,094,556, as prompted by an order paper question from Conservative Senator Don Plett last September, yet yielded no tangible outcomes.
An internal memo from late 2019 revealed that the Liberals projected their politically motivated harassment would incur a cost of $1.8 billion.
Enforcement efforts Questioned
By December 2023, estimates from TheGunBlog.ca indicate that the Liberals and RCMP had incurred or were responsible for approximately $30 million in personnel expenses related to the enforcement efforts. The union representing the police service previously stated that the effort to confiscate firearms is a “misdirected effort” aimed at ensuring public safety.
“This action diverts crucial personnel, resources, and funding from tackling the more pressing and escalating issue of criminal use of illegal firearms,” stated the National Police Federation (NPF).
The Canadian Sporting Arms & Ammunition Association (CSAAA), representing firearms retailers, has stated it will have “zero involvement” in the confiscation of these firearms. Even Canada Post held back from providing assistance due to safety concerns.
The consultant previously assessed that retailers are sitting on almost $1 billion worth of inventory that cannot be sold or returned to suppliers because of the Order-In-Council.
“Despite the ongoing confusion surrounding the ban, after four years, we ought to be able to address one crucial question.” Has the prohibition enhanced safety for Canadians? Mauser asks.
Illegally Obtained Firearms are the Problem
Statistics Canada reports a 10% increase in firearm-related violent crime between 2020 and 2022, rising from 12,614 incidents to 13,937 incidents. In that timeframe, the incidence of firearm-related violent crime increased from 33.7 incidents per 100,000 population in 2021 to 36.7 incidents the subsequent year.
“This marks the highest rate documented since the collection of comparable data began in 2009,” the criminologist explains.
Supplementary DataData indicates that firearm homicides have risen since 2020. “The issue lies not with lawfully-held firearms,” Mauser stated.
Firearms that have been banned under the Order-in-Council continue to be securely stored in the safes of their lawful owners. The individuals underwent a thorough vetting process by the RCMP and are subject to nightly monitoring to ensure there are no infractions that could pose a risk to public safety.
“The firearms involved in homicides were seldom legally owned weapons wielded by their rightful owners,” Mauser continues. The number of offenses linked to organized crime has surged from 4,810 in 2016 to a staggering 13,056 in 2020.
“If those in power … aim to diminish crime and enhance public safety, they ought to implement strategies that effectively focus on offenders and utilize our limited tax resources judiciously to reach these objectives,” he stated.
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News
Google’s Search Dominance Is Unwinding, But Still Accounting 48% Search Revenue
Google is so closely associated with its key product that its name is a verb that signifies “search.” However, Google’s dominance in that sector is dwindling.
According to eMarketer, Google will lose control of the US search industry for the first time in decades next year.
Google will remain the dominant search player, accounting for 48% of American search advertising revenue. And, remarkably, Google is still increasing its sales in the field, despite being the dominating player in search since the early days of the George W. Bush administration. However, Amazon is growing at a quicker rate.
Google’s Search Dominance Is Unwinding
Amazon will hold over a quarter of US search ad dollars next year, rising to 27% by 2026, while Google will fall even more, according to eMarketer.
The Wall Street Journal was first to report on the forecast.
Lest you think you’ll have to switch to Bing or Yahoo, this isn’t the end of Google or anything really near.
Google is the fourth-most valued public firm in the world. Its market worth is $2.1 trillion, trailing just Apple, Microsoft, and the AI chip darling Nvidia. It also maintains its dominance in other industries, such as display advertisements, where it dominates alongside Facebook’s parent firm Meta, and video ads on YouTube.
To put those “other” firms in context, each is worth more than Delta Air Lines’ total market value. So, yeah, Google is not going anywhere.
Nonetheless, Google faces numerous dangers to its operations, particularly from antitrust regulators.
On Monday, a federal judge in San Francisco ruled that Google must open up its Google Play Store to competitors, dealing a significant blow to the firm in its long-running battle with Fortnite creator Epic Games. Google announced that it would appeal the verdict.
In August, a federal judge ruled that Google has an illegal monopoly on search. That verdict could lead to the dissolution of the company’s search operation. Another antitrust lawsuit filed last month accuses Google of abusing its dominance in the online advertising business.
Meanwhile, European regulators have compelled Google to follow tough new standards, which have resulted in multiple $1 billion-plus fines.
Google’s Search Dominance Is Unwinding
On top of that, the marketplace is becoming more difficult on its own.
TikTok, the fastest-growing social network, is expanding into the search market. And Amazon has accomplished something few other digital titans have done to date: it has established a habit.
When you want to buy anything, you usually go to Amazon, not Google. Amazon then buys adverts to push companies’ products to the top of your search results, increasing sales and earning Amazon a greater portion of the revenue. According to eMarketer, it is expected to generate $27.8 billion in search revenue in the United States next year, trailing only Google’s $62.9 billion total.
And then there’s AI, the technology that (supposedly) will change everything.
Why search in stilted language for “kendall jenner why bad bunny breakup” or “police moving violation driver rights no stop sign” when you can just ask OpenAI’s ChatGPT, “What’s going on with Kendall Jenner and Bad Bunny?” in “I need help fighting a moving violation involving a stop sign that wasn’t visible.” Google is working on exactly this technology with its Gemini product, but its success is far from guaranteed, especially with Apple collaborating with OpenAI and other businesses rapidly joining the market.
A Google spokeswoman referred to a blog post from last week in which the company unveiled ads in its AI overviews (the AI-generated text that appears at the top of search results). It’s Google’s way of expressing its ability to profit on a changing marketplace while retaining its business, even as its consumers steadily transition to ask-and-answer AI and away from search.
Google has long used a single catchphrase to defend itself against opponents who claim it is a monopoly abusing its power: competition is only a click away. Until recently, that seemed comically obtuse. Really? We are going to switch to Bing? Or Duck Duck Go? Give me a break.
But today, it feels more like reality.
Google is in no danger of disappearing. However, every highly dominating company faces some type of reckoning over time. GE, a Dow mainstay for more than a century, was broken up last year and is now a shell of its previous dominance. Sears declared bankruptcy in 2022 and is virtually out of business. US Steel, long the foundation of American manufacturing, is attempting to sell itself to a Japanese corporation.
SOURCE | CNN
News
The Supreme Court Turns Down Biden’s Government Appeal in a Texas Emergency Abortion Matter.
(VOR News) – A ruling that prohibits emergency abortions that contravene the Supreme Court law in the state of Texas, which has one of the most stringent abortion restrictions in the country, has been upheld by the Supreme Court of the United States. The United States Supreme Court upheld this decision.
The justices did not provide any specifics regarding the underlying reasons for their decision to uphold an order from a lower court that declared hospitals cannot be legally obligated to administer abortions if doing so would violate the law in the state of Texas.
Institutions are not required to perform abortions, as stipulated in the decree. The common populace did not investigate any opposing viewpoints. The decision was made just weeks before a presidential election that brought abortion to the forefront of the political agenda.
This decision follows the 2022 Supreme Court ruling that ended abortion nationwide.
In response to a request from the administration of Vice President Joe Biden to overturn the lower court’s decision, the justices expressed their disapproval.
The government contends that hospitals are obligated to perform abortions in compliance with federal legislation when the health or life of an expectant patient is in an exceedingly precarious condition.
This is the case in regions where the procedure is prohibited. The difficulty hospitals in Texas and other states are experiencing in determining whether or not routine care could be in violation of stringent state laws that prohibit abortion has resulted in an increase in the number of complaints concerning pregnant women who are experiencing medical distress being turned away from emergency rooms.
The administration cited the Supreme Court’s ruling in a case that bore a striking resemblance to the one that was presented to it in Idaho at the beginning of the year. The justices took a limited decision in that case to allow the continuation of emergency abortions without interruption while a lawsuit was still being heard.
In contrast, Texas has been a vocal proponent of the injunction’s continued enforcement. Texas has argued that its circumstances are distinct from those of Idaho, as the state does have an exemption for situations that pose a significant hazard to the health of an expectant patient.
According to the state, the discrepancy is the result of this exemption. The state of Idaho had a provision that safeguarded a woman’s life when the issue was first broached; however, it did not include protection for her health.
Certified medical practitioners are not obligated to wait until a woman’s life is in imminent peril before they are legally permitted to perform an abortion, as determined by the state supreme court.
The state of Texas highlighted this to the Supreme Court.
Nevertheless, medical professionals have criticized the Texas statute as being perilously ambiguous, and a medical board has declined to provide a list of all the disorders that are eligible for an exception. Furthermore, the statute has been criticized for its hazardous ambiguity.
For an extended period, termination of pregnancies has been a standard procedure in medical treatment for individuals who have been experiencing significant issues. It is implemented in this manner to prevent catastrophic outcomes, such as sepsis, organ failure, and other severe scenarios.
Nevertheless, medical professionals and hospitals in Texas and other states with strict abortion laws have noted that it is uncertain whether or not these terminations could be in violation of abortion prohibitions that include the possibility of a prison sentence. This is the case in regions where abortion prohibitions are exceedingly restrictive.
Following the Supreme Court’s decision to overturn Roe v. Wade, which resulted in restrictions on the rights of women to have abortions in several Republican-ruled states, the Texas case was revisited in 2022.
As per the orders that were disclosed by the administration of Vice President Joe Biden, hospitals are still required to provide abortions in cases that are classified as dire emergency.
As stipulated in a piece of health care legislation, the majority of hospitals are obligated to provide medical assistance to patients who are experiencing medical distress. This is in accordance with the law.
The state of Texas maintained that hospitals should not be obligated to provide abortions throughout the litigation, as doing so would violate the state’s constitutional prohibition on abortions. In its January judgment, the 5th United States Circuit Court of Appeals concurred with the state and acknowledged that the administration had exceeded its authority.
SOURCE: AP
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