China, Germany, Brexit, Ohio, Sprint, T-Mobile, Kentucky Derby, Giro d'Italia
Marc Ross Daily
April 30, 2018
Curation and commentary from Marc A. Ross
Reporting from Alexandria, Virginia
Marc Ross Daily = Global Business News at the Intersection of Politics + Policy + Profits
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TOP FIVE
✔️ China eases rules on foreign investment in securities firms
✔️ Expect tough talk when US trade hawks visit, not an end to the row
✔️ Brexit talks could collapse over Irish border issue
✔️ In battle to be Ohio governor candidate, it’s left vs. left
✔️ Less than a week until the Kentucky Derby
GEOECONOMICS
China eases rules on foreign investment in securities firms: FT reports, China has revealed new regulations that allow foreign investors to take majority control of local securities firms, after President Xi Jinping called for an intensification of financial reforms in the midst of a bitter trade row with the US. After years of complaints about Beijing blocking foreign access to its fast-growing financial markets, the China Securities Regulatory Commission at the weekend published the new rules, which raise the cap on foreign ownership on stockbroking firms from 49 percent to 51 percent, effective immediately.
For China, the American team of trade rivals won’t be easy to please: WSJ reports, China is looking to dazzle a visiting U.S. trade delegation this week, arranging a session with President Xi Jinping and planning pledges to cut tariffs and ease regulations. It will likely take more than that to impress the visiting Americans and head off a looming trade war. It will be a high-stakes meeting, starting Thursday. U.S.-China economic relations have sunk to their lowest point in decades with the U.S., angry over alleged Chinese pressure on U.S. firms to transfer technology to Chinese partners and other misdeeds, threatening tariffs on $150 billion in Chinese goods and prohibitions on Chinese purchase of U.S. technology. The trade mission gives both sides a chance at easing those tensions, but chances of a quick resolution are slim.
Expect tough talk when US trade hawks visit, not an end to the row: SCMP reports, expectations are low that China’s trade squabbles with the US can be easily resolved, as three of the biggest hawks in US President Donald Trump’s administration prepare for a joint trip to Beijing next week. US Trade Representative Robert Lighthizer, National Economic Council head Larry Kudlow, and White House trade adviser Peter Navarro will accompany US Treasury Secretary Steve Mnuchin to Beijing on Thursday and Friday, where they are scheduled to meet Chinese officials including President Xi Jinping and Vice-President Wang Qishan.
NYT: China prepares a hard-line stance on U.S. trade demands
"China will refuse to discussTrump’s two toughest trade demands in talks with U.S. negotiators this week, people involved in Chinese policymaking say."
"Beijing feels its economy has become big enough and resilient enough to stand up to the United States."
U.S. allies brace for trade war as talks on Trump tariffs stall: NYT reports, days before tariffs on steel and aluminum take effect, it’s dawning on foreign leaders that decades of warm U.S. relations carry little weight with a president dismissive of diplomatic norms.
Germany wants wider trade talks with U.S. even if tariffs hit: Reuters reports, Germany on Monday dampened hopes that an exemption from U.S. tariffs on steel and aluminum could be extended for European Union countries, but called for trade negotiations to continue regardless of whether the levies are applied.
FT: Hunt intensifies to solve Irish border dilemmahttps://on.ft.com/2HGLxYI
"Hybrid models, fallback measures for UK as a whole and other proposals in the mix"
The Times: Brexit talks could collapse over Irish border issue, says EU negotiator
Banks seem oddly unconcerned about Brexit: They keep doing more business from the U.K.
Bloomberg - Mark Whitehouse
"Is the U.K. really going to leave the European Union? Judging from their lending activity, bankers might be having some doubts."
Sajid Javid named home secretary: The Times, Sajid Javid was today promoted to become the first Asian politician to hold a great office of state as Theresa May tried to shore up her government after Amber Rudd’s resignation.
The home of British democracy is rotting from within. The cost to fix Westminster? $5 billion. WP reports, British lawmakers approved one of the most ambitious restoration projects of the modern age, a scheme that would see the entire Parliament decamp to nearby buildings for six years while the Palace of Westminster gets a much-needed makeover.
AMERICAN POLITICS
‘Ready, shoot, aim’: Trump’s loyalty tests cause hiring headaches: WP reports, the failed nomination of Ronny L. Jackson to lead the Department of Veterans Affairs was the latest example of the sometimes haphazard way President Trump unilaterally elevates people with whom he has a personal rapport. “Trump decides who he wants and tells people,” said a strategist who works closely with the West Wing. “That’s the vetting process.”
In battle to be Ohio governor candidate, it’s left vs. left: NYT reports, Senator Elizabeth Warren has endorsed one candidate for Ohio governor. Senator Bernie Sanders calls the other an old friend. Which is the true progressive? https://nyti.ms/2ragQQh
OH-GOV: The Democratic primary next week pits Richard Cordray, a onetime director of the Consumer Financial Protection Bureau, against Dennis Kucinich, a former congressman, and presidential candidate.
Democrats lose ground with millennials: poll: Enthusiasm for the Democratic Party is waning among young voters as its candidates head into the crucial midterm congressional elections, a Reuters/Ipsos poll reports. https://reut.rs/2HG1j1Q
This rural Wisconsin county is famous in China. A trade war could take it all away. WP reports, there are ginseng farms in this remote corner of Wisconsin where phones are answered in Mandarin. Others have opened storefronts or retrofitted spare rooms to welcome busloads of Chinese tourists and businesspeople. This rural area built an important local industry as a purveyor of a premium product for China’s rising middle class, where its ginseng is sold in boxes bearing the American flag and the line, “Something Special from Wisconsin.” Now trade tensions between the United States and China threaten a niche market that employs hundreds of workers and supports dozens of family farms in a rural community where other options are limited.
Trump's steel tariffs are squeezing U.S. businesses — and things could get worse: LAT reports, the tariffs have already brought higher prices for many American manufacturers and construction firms, and exemptions granted to some of the biggest steel and aluminum exporters to the U.S. are set to expire on Tuesday.
These are the industries Trump should protect from China if he wants to win elections: WP reports, tariffs can be powerful political weapons, and Donald Trump is about to give himself plenty of ammunition. The administration has listed about $50 billion in Chinese goods it plans to tax, and it announced plans to impose tariffs on an additional $100 billion in the near future. Assuming the tariffs go forward, we can use research and trade data to consider where they could be deployed for maximum political gain. https://wapo.st/2vNlHfQ
ENTERPRISE
Walmart to sell U.K. arm amid shift in overseas strategy: WSJ reports, Walmart said it would sell its British arm Asda to rival J Sainsbury, a deal that values the chain at about $10 billion and would, if successful, create the largest player in the U.K.’s fiercely competitive grocery market.
Sainsbury's in $10 billion swoop on Asda to create top UK supermarket: Reuters reports, Sainsbury's has agreed to buy Walmart's Asda for about 7.3 billion pounds ($10 billion) to create Britain's biggest supermarket group by market share, overtaking long-standing industry leader Tesco.
Marathon Petroleum agreed to buy pipeline and refining company Andeavor for $23.3 billion.
WSJ: Volkswagen, Didi Chuxing to unveil ride-hailing joint venture
FT: T-Mobile and Sprint agree all-stock merger
NYT: Sprint and T-Mobile agree to merge. Will the FCC allow it?
Reuters: T-Mobile, Sprint say $26 billion deal would give U.S. tech lead over China
Playing the US vs. China card...... Horserace + global business + headlines = New M&A strategy
SPORT
Kentucky Derby: The race runs on Saturday, May 5 with a post time at 6:50 p.m. ET. Justify, who won this year's Santa Anita Derby and is trained by Bob Baffert, is the 2-1 favorite at William Hill US. Right behind Justify is Magnum Moon, who's going off at 4-1 and is trained by Todd Pletcher. Eleven horses are getting 20-1 Kentucky Derby odds or better.
Less than a week until the Kentucky Derby.
NBA begins to address mental health and athletes: AFP reports, The NBA is joining forces with the players' union to launch a mental wellness program with the hope that athletes will see it as a way to open up about their struggles with mental health. Toronto Raptors DeMar DeRozan and Cleveland Cavaliers Kevin Love are helping to jump start the program, which begins in part this week with a website and public service ads encouraging mental wellness for its athletes. "We always preach eating healthy, exercising, being an elite athlete," DeRozan told the Toronto Globe and Mail newspaper.
Israel hopes for revelation by hostingstart of Giro cycling race: AFP reports, Often in the news as the epicentre of the Israeli-Palestinian conflict, Jerusalem will later this week become the backdrop of the start of one of cycling's biggest races, the Giro d'Italia. The race's "Big Start", beginning Friday, marks the first time any of cycling's three major races -- the Giro, Tour de France and Vuelta a Espana -- will begin outside of Europe.
