June 4 2024
NY techlash; American economy; semiconductors; NJ Senate; OPEC; Russia-China pipeline; Dunkirk
1 NY bans underage algos without parental consent
2 Consumer spending slows, threatening economy
3 CHIPS Act boosts US market share from 12% to 14% by 2032
4 ELECTION 2024 NJ Sen to run as Indy
5 OPEC+ extends output cuts, keeping upward pressure on oil prices
BONUS In crack in partnership, Russia-China gas pipeline deal stalls
6/4/1940 Evacuation Dunkirk ends
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1 NY bans underage algos without parental consent
New York plans to prohibit social-media companies from using algorithms to steer content to children without parental consent under a tentative agreement reached by state lawmakers, people familiar with the matter said. The legislation is aimed at preventing social-media companies from serving automated feeds to minors. Critics say the feeds lead children to violent and sexually explicit content. The bill, which is still being completed but expected to be voted on this week, also would prohibit platforms from sending minors notifications during overnight hours without parental consent. Democratic Gov. Kathy Hochul has said the measure would make social media less addictive, adding that heavy usage by teens has contributed to higher instances of mental illness. Industry groups have raised questions about the constitutionality of the proposal and said media literacy would have a more immediate impact. They have won court injunctions blocking regulations in other states from taking effect.
Ed note: this tech backlash is bipartisan and picking up steam. If I were Big Tech I’d be worried.
Article Source: WSJ
2 Consumer spending slows, threatening economy
The main drivers behind the remarkably resilient American consumer are losing steam at the same time, suggesting a recent pullback in household demand may be more than just a one-off. Real disposable incomes have risen only modestly over the past year. The saving rate now stands at a 16-month low as households have mostly exhausted the extra pile of cash they squirreled away during the pandemic. In turn, many Americans are increasingly relying on credit cards and other sources of financing to support their spending. These factors help explain why real spending — which excludes the impact from inflation — fell in April, with consumers shelling out less on cars, restaurants and recreational activities. With the job market also cooling, companies like Best Buy Co. have noticed a change in recent months as shoppers switch to cheaper brands.
Article Source: Bloomberg
3 CHIPS Act boosts US market share from 12% to 14% by 2032
Two years into a nearly $53 billion government effort to shore up the U.S. chip industry, the program’s impact is becoming clearer: Big companies making advanced chips are getting a boost, but there are limits to what the money can do. The Chips Act, passed in 2022 to jump-start domestic semiconductor production, is supposed to supercharge chip making in the U.S. But even in its early stages, it is being challenged by fast-growing chip industries in competing countries, political complexity regarding the allotments at home and the sheer expense of manufacturing chips. The lion’s share of the allotments have been slated for Intel and other large chip makers that plan to make advanced chips in the U.S., while some companies that are important in other parts of the chip-making supply chain have missed out. Meanwhile, other countries have amped up spending to keep competitive. The White House calls the policy a victory. In his State of the Union speech in March, President Biden pointed to shortages of chips during the pandemic that drove up prices for mobile phones and cars. Instead of importing those chips, he said, private companies are now investing billions to build new factories in the U.S. The program is forecast to triple the number of chips made in the U.S. by 2032, according to a new Boston Consulting Group study commissioned by the Semiconductor Industry Association. The building boom should boost the U.S. share of global chip production to about 14% in 2032, the study projects, compared with 12% in 2020. That modest overall increase in U.S. market share partly reflects that European countries, South Korea, Japan, Taiwan and China are also stepping up investment in their own respective chip industries, underscoring how the global race to produce more of the most advanced semiconductors is expanding and accelerating.
Article Source: WSJ
4 ELECTION 2024 NJ Sen to run as Indy
Senator Robert Menendez of New Jersey, a lifelong Democrat who is in his fourth week of a federal bribery trial, filed paperwork Monday to run for re-election as an independent in November. The specter of Mr. Menendez, 70, trying to mount a comeback campaign raises the possibility of a splintered Democratic vote in November’s election, creating a wider lane for the Republican nominee at a time when Democrats are struggling to retain their narrow majority in the Senate. Mr. Menendez has been abandoned by most of the state’s leading Democrats, who quickly called on him to resign after he was indicted on corruption charges last year. He has defiantly refused to step down, but he opted not to run in Tuesday’s Democratic primary.
Several Republicans are competing for the Senate nomination in Tuesday’s primary. Registered Democrats outnumber Republicans in New Jersey by more than 900,000 voters, and it has been a half century since the liberal-leaning state elected a Republican to the U.S. Senate.
Ed note: this has major implications for the Senate. If Menendez run as an Independent, splits the Dem vote, and the Rep wins, its almost impossible for the Dems to hold the Senate.
Article Source: NYT
5 OPEC+ extends output cuts, keeping upward pressure on oil prices
OPEC+ on Sunday agreed to extend all production curbs into next year, a deal that likely signals oil prices will remain elevated through the U.S. presidential election. The agreement comes on the same day the group’s kingpin, Saudi Arabia, launched a giant sale of shares in its national oil champion that will yield billions to help fund the kingdom’s economic transformation.
Article Source: WSJ
BONUS In crack in partnership, Russia-China gas pipeline deal stalls
Russia’s attempts to conclude a major gas pipeline deal with China have run aground over what Moscow sees as Beijing’s unreasonable demands on price and supply levels, according to three people familiar with the matter. Beijing’s tough stance on the Power of Siberia 2 pipeline underscores how Russia’s invasion of Ukraine has left President Vladimir Putin increasingly dependent on Chinese leader Xi Jinping for economic support. The people familiar with the matter said China had asked to pay close to Russia’s heavily subsidised domestic prices and would only commit to buying a small fraction of the pipeline’s planned annual capacity of 50bn cubic metres of gas. Approval for the pipeline would transform the dire fortunes of Gazprom, Russia’s state gas export monopoly, by linking the Chinese market to gasfields in western Russia that once supplied Europe. Gazprom suffered a loss of Rbs629bn ($6.9bn) last year, its biggest in at least a quarter of a century, amid plummeting gas sales to Europe, which has had greater success than expected in diversifying away from Russian energy.
Article Source: FT
6/4/1940 Evacuation of Dunkirk ends
As the German army advances through northern France during the early days of World War II, it cuts off British troops from their French allies, forcing an enormous evacuation of soldiers across the North Sea from the town of Dunkirk to England. The Allied armies, trapped by the sea, were quickly being encircled on all sides by the Germans. By May 19, 1940, British commanders were already considering the withdrawal of the entire British Expeditionary Force (BEF) by sea. On May 26, the British began to implement Operation Dynamo—the evacuation of Allied forces from Dunkirk. As there were not enough ships to transport the huge masses of men stranded near the beaches, the British Admiralty called on all British citizens in possession of any seaworthy vessels to lend their ships to the effort. Hundreds of fishing boats, pleasure yachts, lifeboats, ferries and other civilian ships of every size and type raced to Dunkirk, braving mines, bombs, torpedoes and the ruthless airborne attacks of the German Luftwaffe.
By June 4, when the Germans closed in and the operation came to an end, more than 338,000 soldiers were saved. In the days following the successful evacuation, the campaign became known as the “Miracle of Dunkirk.”
Sources
1. https://www.wsj.com/politics/new-york-set-to-restrict-social-media-algorithms-for-teens-ce250dfe?st=wk1jjphbq9seff9&reflink=article_copyURL_share
2. https://www.bloomberg.com/news/articles/2024-06-02/key-engines-of-us-consumer-spending-are-losing-steam-all-at-once
3. https://www.wsj.com/tech/chips-act-funding-semiconductor-investments-us-22cc1ea8?st=i6ki03wdw9df0qy&reflink=article_copyURL_share
4. https://www.nytimes.com/2024/06/03/nyregion/senator-robert-menendez-independent-campaign.html?smid=nytcore-ios-share&referringSource=articleShare&sgrp=c-cb
5.
https://www.wsj.com/business/energy-oil/opec-agrees-to-extend-production-cuts-in-bid-to-boost-oil-prices-7ef55454
6. https://on.ft.com/3VpTLso
Thanks for reading!
