US ECONOMY & POLITICS

US Job Openings, Quits and Hiring Ease as Labor Market Cools – Bloomberg, 1/3/2024

• US job openings eased in November to the lowest level since early 2021, fewer workers voluntarily quit their positions and the number of hires fell, adding to evidence of cooling labor demand.
• Vacancies decreased to 8.79 million from an upwardly revised 8.85 million in the prior month, the Bureau of Labor Statistics Job Openings and Labor Turnover Survey, known as JOLTS, showed Wednesday.
• Hiring declined to the lowest level since July 2020. Layoffs edged lower.
• The median estimate in a Bloomberg survey of economists called for 8.82 million openings.
• The easing in vacancies included declines in transportation and warehousing, government, business services, and leisure and hospitality.
• The so-called quits rate, which measures people who voluntary leave their jobs as a share of total employment, ticked down to the lowest since September 2020.
• The ratio of openings to unemployed people held at 1.4.

US Factory Gauge Shows 14th Month of Shrinking Activity – Bloomberg, 1/3/2024

• A measure of US factory activity remained stuck in contraction territory for a 14th month at the end of 2023, restrained by weaker orders.
• The Institute for Supply Management’s manufacturing gauge edged up 0.7 point to 47.4 last month, helped by a pickup in production, according to data released Wednesday.
• The December result extends the longest stretch of shrinking activity since 2000-2001, when the dot-com bubble burst and sparked a recession.
• While the ISM gauge still shows contraction, it is holding in a range that suggests activity has stabilized at a weak level.
• In the ISM’s latest semiannual economic forecast, 15 of 18 manufacturing industries project that revenue will increase, while capital expenditures are seen rising almost 12%.
• Cheaper commodities are benefiting many of the nation’s producers.
• The prices paid index decreased by 4.7 points to 45.2, helped by a drop in oil prices to an almost six-month low in December.

Fed’s Barkin Says Soft Landing Looks More Likely, But Not Inevitable – Bloomberg, 1/3/2024

• Federal Reserve Bank of Richmond President Thomas Barkin said a soft landing for the US economy is looking more likely but hardly certain, reiterating the continued possibility of further tightening.
• “A soft landing is increasingly conceivable but in no way inevitable,” Barkin, who will vote on policy decisions this year, said in the text of a speech Wednesday.
• “Demand, employment and inflation all surged but now seem to be on a path back toward normal.”
• Barkin defined a soft landing as inflation returning to normal levels while the economy stays “healthy.”
• He said inflation is “coming into range of our 2% target” and six-month core inflation, which excludes food and energy prices, is running slightly below the target.
• “While you might think this would be a first-class problem, strong demand isn’t the solution to above-target inflation,” he said.
• “That’s why the potential for additional rate hikes remains on the table.”
• “Conditions are ever evolving,” he said.
• “So too will our approach. So, buckle up. That’s the proper safety protocol even if you expect a soft landing.”

US Home-Purchase Applications Fall in Week Including Christmas – Bloomberg, 1/3/2024

• US mortgage applications for home purchases declined from an almost five-month high as borrowing costs ticked higher in the final week of 2023.
• The Mortgage Bankers Association’s gauge of mortgage applications to buy a home slid 7.6%, the most since April, in the week ended Dec. 29.
• The contract rate on a 30-year fixed mortgage edged up 5 basis points to 6.76%.
• The figures tend to be volatile around holidays, and the last week included Christmas.
• The MBA’s overall index of mortgage applications, which includes both purchases and refinancings, decreased 10.7% last week, the most since February.

U.S. Auto Sales Bounced Back in 2023 – Wall Street Journal, 1/3/2024

• U.S. auto sales rebounded in 2023, boosted by pent-up demand and better availability on dealership lots.
• Major automakers are expected to report their year-end sales tallies throughout the day Wednesday.
• Analysts project industrywide sales of new cars for the U.S. could reach nearly 15.5 million in 2023, about a 13% increase from the prior year once all car companies have released their figures.
• Based on their 2023 projections, analysts are forecasting some changes to the traditional pecking order with Hyundai Motor expected to pull ahead of Chrysler-parent Stellantis to become the U.S.’s fourth-largest car seller.
• The company follows market leaders General Motors, Toyota Motor and Ford.
• Honda Motor is expected to record one of the industry’s largest sales gains with a 32% increase year-over-year, according to automotive services firm Cox Automotive.
• Stellantis, which also owns Jeep, Ram and several other automotive brands, is forecast to post a 2% decline, one of the few car companies to lose sales on an annual basis.

House Republicans Rally at Southern Border as Senate Talks Continue – Wall Street Journal, 1/3/2024

• House Republicans are trekking to Texas to rail against what they say are failures of the Biden administration to stem record flows of migrants, as Senate negotiators meet on Capitol Hill in a last-ditch effort to strike a bipartisan deal to revamp U.S. border policies.
• Speaker Mike Johnson (R., La.) led the delegation of about 60 House Republicans to Eagle Pass, Texas, where lawmakers plan to meet with federal and local officials and hold a press conference Wednesday afternoon.
• “Life along the border is turned upside down and that’s exactly what the speaker and my colleagues are going to see,” said Rep. Tony Gonzales (R., Texas), who is hosting the delegation in his district along the border, on Fox News Sunday.
• “Enough is enough. It’s time to deport those that illegally come into the United States.”
• The show of force from Republicans underscores the difficult path any agreement in the Democratic-led Senate would face in the Republican-controlled House, with lawmakers set to return to work next week.
• Under current immigration law, most migrants can’t be immediately deported if they ask for asylum, even if they enter the country illegally.
• The bipartisan immigration agreement senators are negotiating could make it easier to do so, though many Republicans, particularly in the House, have expressed doubt that any deal could go far enough to satisfy them.

Trump Sues Maine Official Who Disqualified Him From Ballot – Bloomberg, 1/3/2024

• Donald Trump filed a lawsuit seeking to restore his name to Maine’s presidential primary ballot after the state disqualified him over his attempt to reverse the result of the 2020 election he lost to Joe Biden.
• The lawsuit filed Tuesday challenges a decision last week by Maine Secretary of State Shenna Bellows, who held that the former president is ineligible for another term because of a section of the US Constitution’s 14th Amendment.
• The provision bars from federal office those who have sworn an oath to support the Constitution and then “engaged in insurrection” against the US.
• “Maine’s secretary of state went outside of her authority, completely ignoring the Constitution when she summarily decided to remove President Trump’s name from the ballot, interfere in the election, and disenfranchise the voters of her state,” Steven Cheung, a Trump campaign spokesman, said in a statement.

EUROPE & WORLD

At Least 103 Dead in Blasts at Memorial for Killed Iranian Commander Soleimani – Wall Street Journal, 1/3/2024

• At least 103 people were killed in explosions in Iran near a public ceremony commemorating the death of a senior Islamic Revolutionary Guard Corps officer killed by an American airstrike in 2020, the country’s state media reported.
• Iranian officials said the blasts were the work of terrorists.
• At least 170 others were wounded by the blasts, which took place as crowds gathered near the tomb of Maj. Gen. Qassem Soleimani, according to Iran’s government-run Islamic Republic News Agency.
• Iran said it was investigating the cause of the explosions.
• Wednesday’s blasts in the southeastern Iranian city of Kerman took place near a cemetery where Iranians were marking the death of Soleimani, a top commander of Iran’s Islamic Revolutionary Guard Corps, who was killed in an American drone strike that also stoked tensions between Washington and Iran.
• Television footage of the incident showed crowds of people, including people carrying a banner in the memorial procession, running and screaming following the sound of a blast.

Hamas Says Israel Kills Senior Official in Beirut Attack – Bloomberg, 1/3/2024

• A senior Hamas leader was killed by Israel in an explosion in Beirut, according to the Palestinian militant group, raising fresh concerns of a regional escalation of the war in Gaza.
• Hamas said Israel killed Saleh Al-Arouri, deputy head of the group’s politburo, who was known as the mastermind behind its armed wing in the West Bank.
• Lebanon’s caretaker premier also blamed Israel and said the attack was meant to “drag Lebanon into a new phase of confrontation.”
• If confirmed, it would be Israel’s first such attack on the Lebanese capital in almost two decades.
• Al-Arouri would be the most senior Hamas leader killed since the group, designated as a terrorist organization by the US and European Union, infiltrated Israel on Oct. 7 and killed almost 1,200 people.
• Hours before Al-Arouri’s killing, Turkey detained 33 people who it alleged were spying on Palestinians on behalf of Israel’s Mossad intelligence agency.

Ryanair Sees Sales Shortfall as Online Travel Agents Cut Flights – Bloomberg, 1/3/2024

• Ryanair Holdings’s victory in removing flights from online travel agents’ websites will cost the airline ticket sales in the short term.
• Aggregators such as Booking.com, Kayak and Kiwi abruptly stopped selling Ryanair flights on their platforms in December, the Irish low-cost airline said in a statement on Wednesday.
• The move is set to reduce short-term load factors, or the ratio of occupied seats on a plane, by up to 2% in December and January, Ryanair said.
• Prices are also set to soften as Ryanair lowers fares to encourage passengers to book directly through the airline, it said.
• Ryanair said it didn’t expect the removal of flights to “materially affect” full-year traffic volumes or profit-after-tax guidance as they account for a small portion of the airline’s bookings.
• Ryanair said in the statement that load factors in December averaged 91% of available seats, compared with 92% at the same time in 2022.

China’s Workers Suffer Biggest Drop in Hiring Salaries on Record – Bloomberg, 1/3/2024

• Wages offered to Chinese workers in major cities declined by the most on record, underscoring persisting deflationary pressures and sluggish consumer confidence in the world’s second-largest economy.
• Average salaries offered by companies to new hires in 38 key Chinese cities fell 1.3% to 10,420 yuan ($1,458) in the fourth quarter of 2023 from a year ago.
• That was the worst drop since at least 2016, according to data from online recruitment platform Zhaopin compiled by Bloomberg.
• It’s also the third straight quarter of decline, the longest run since data on yearly changes were first available in 2016.
• In Beijing, the wages decreased 2.7% from a year ago in the fourth consecutive quarter of contraction.
• Salaries in the southern metropolis of Guangzhou fell 4.5%.

China’s Balloons Are Back. This Time They Are Over Taiwan. – Wall Street Journal, 1/3/2024

• Nearly a year after the appearance of a suspected Chinese spy balloon over the U.S. sent relations between Beijing and Washington into free fall, high-altitude balloons from China have again been spotted floating over sensitive territory.
• This time, it is the main island of self-ruled Taiwan, which is days away from holding a presidential election with ramifications for the future of U.S.-China relations.
• Taiwan’s Ministry of National Defense said it detected a Chinese balloon flying over the island on Monday, followed by three more balloons on Tuesday.
• The ministry has previously noted Chinese balloons floating near the island, but this is the first-time authorities have reported the balloons crossing over it.
• Maj. Gen. Sun Li-fang, a spokesman for the ministry, said Tuesday that the balloons appeared to be the kind designed to collect atmospheric data.

China Removes Videogame Official After Planned Curbs Triggered Market Rout – Wall Street Journal, 1/3/2024

• Beijing removed a key official overseeing China’s videogame industry, days after authorities proposed curbs that wiped tens of billions of dollars off the market value of Chinese game companies.
• Feng Shixin, the head of the publication bureau of the Communist Party’s Propaganda Department, was told to step down last week, people familiar with the matter said.
• He was dismissed over the department’s handling of the release of the draft rules at a time of weak market sentiment, including inadequate communication and explanation of the policy, according to the people.
• Feng’s exit came as authorities indicated to game companies that they might walk back some of the proposed rules, which would limit the time and money people spend on computer and smartphone games, the people said.
• The rules are open for public comment until Jan. 22.

VinFast Planning Battery Plant in Southern India in 2024, Sources Say – Bloomberg, 1/3/2024

• VinFast Auto is planning to set up a battery manufacturing plant in the southern Indian state of Tamil Nadu this year, according to a person familiar with the matter.
• The person, who asked not to be named as the information is still private, didn’t give details about the value of the investment.
• The factory will be located in the city of Thoothukudi, the person said.
• A VinFast spokesperson declined to comment on the information, saying the company will reveal details of its plans “at the appropriate time.”
• VinFast last year said it planned to set up an EV factory in India with an investment of $150 million to $200 million in the first phase.
• The South Asian plant will have an initial capacity of about 50,000 vehicles per year, with production expected to commence by 2026, the company said.

Bob Menendez Took Bribes to Help Qatar and Egypt, US Says – Bloomberg, 1/3/2024

• US Senator Bob Menendez faces revised charges that he took bribes from a New Jersey businessman to help Qatar even as he acted on behalf of Egypt, prosecutors said in a revised indictment of the New Jersey Democrat.
• The indictment Tuesday alleges Menendez accepted bribes of cash and gold bars from developer Fred Daibes, who was seeking an investment from a Qatari fund for a real estate project.
• In exchange, Menendez made “multiple public statements” supporting the government of Qatar, the US said.
• Prosecutors had previously accused Menendez in a four-count indictment of conspiring to act as an agent of Egypt as he was chairman of the Senate Foreign Relations Committee.
• While the indictment Tuesday doesn’t add new criminal counts, it details the alleged Qatari scheme for the first time.
• Daibes expected Menendez “to use his influence and power and breach his official duty to assist Daibes” as he sought the Qatari investment, according to the indictment in federal court in New York.

Factmonster – TODAY in HISTORY

• George Washington defeated Cornwallis’s forces at the Battle of Princeton. – 1777
• Britain seized control of the Falkland Islands. – 1833
• Construction of the Brooklyn Bridge began. – 1870
• Congressional proceedings were televised for the first time. – 1947
• Sir Edmund Hillary reached the South Pole overland. – 1958
• Alaska became the 49th state in the United States. – 1959
• Pope John XXIII excommunicated Fidel Castro. – 1962