US ECONOMY & POLITICS

U.S. Retail Sales Unexpectedly Jump in Sign of Resilient Demand – Bloomberg, 9/16/2021

• U.S. retail sales rose unexpectedly in August as a pickup in purchases across most categories more than offset weakness at auto dealers, showing resilient consumer demand for merchandise.
• The value of overall retail purchases climbed 0.7% last month following a downwardly revised 1.8% decrease in July, Commerce Department figures showed Thursday. Excluding autos, sales advanced 1.8% in August, the largest gain in five months.
• The retail sales data showed receipts at restaurants and bars, the only services-spending category in the report, stagnated in August. Meantime, grocery-store receipts climbed 2.1%.
• So-called control group sales, which are used to calculate gross domestic product and exclude food services, auto dealers, building materials stores and gasoline stations, jumped 2.5% in August — the most in five months.

U.S. Jobless Claims Remained Near Pandemic Low Last Week – Wall Street Journal, 9/16/2021

• Jobless claims rose slightly last week but remained near a pandemic low, as layoffs stabilize amid an economic slowdown tied to rising coronavirus cases.
• Initial unemployment claims rose to 332,000 last week from a pandemic low of 312,000 a week earlier, the Labor Department reported Thursday.
• Layoffs due to Hurricane Ida, which hit Louisiana at the end of August, appeared to contribute to the small claims increase, economists said.
• The four-week moving average for claims, which smooths out weekly volatility, fell to 335,750, the lowest level since March 2020.
• Continuing claims, a proxy for the number of individuals receiving benefits, fell to 2.67 million in the week ending Sept. 4, a pandemic low.
• The decline in continuing claims signals some unemployed workers are leaving the unemployment rolls for new jobs.

U.S. business inventory accumulation slows in July – Reuters, 9/16/2021

• U.S. business inventory accumulation slowed in July as motor vehicle retailers struggled to restock amid an ongoing global semiconductor shortage, which is forcing automobile manufacturers to scale back production.
• Business inventories rose 0.5% after increasing 0.9% in June, the Commerce Department said on Thursday.
• Inventories rose 7.2% on a year-on-year basis in July.
• Retail inventories gained 0.4% in July as estimated in an advance report published last month.
• That followed a 0.5% rise in June. Motor vehicle inventories climbed 0.2% instead of 0.3% as estimated last month.
• Retail inventories excluding autos, which go into the calculation of GDP, rose 0.5% as estimated last month.
• Wholesale inventories increased 0.6% in July. Stocks at manufacturers advanced 0.5%.
• Business sales gained 0.5% in July after rising 1.6% in June.
• At July’s sales pace, it would take 1.25 months for businesses to clear shelves, unchanged from June.

Yellen, IRS Push Democrats to Require Banks to Report Taxpayers’ Annual Account Flows – Wall Street Journal, 9/16/2021

• Treasury Secretary Janet Yellen and IRS Commissioner Charles Rettig pressed lawmakers Wednesday to give the Internal Revenue Service more information about taxpayers’ bank accounts, as the Biden administration tries to salvage its struggling tax-compliance proposal.
• In letters to lawmakers, the administration officials again asked Congress to require banks to report annual inflows and outflows from bank accounts with at least $600 or at least $600 worth of transactions, a proposal aimed at letting the IRS target its audits more effectively.
• It would generate about $460 billion over a decade to cover the costs of Democrats’ planned expansion of the social safety net and climate-change policies, according to the administration.
• But after a flurry of opposition from banks and credit unions, House Democrats omitted the proposal from their list of tax-policy changes this week.
• That was a sign that it lacked the support in the party to advance, though a scaled-back version raising about half as much money could still emerge from ongoing talks between administration officials and Congress.
• The requirement would also extend to peer-to-peer payment services such as Venmo but wouldn’t require individuals and businesses to report any additional information to the government.

Democrats Rethink Climate Measures, Consider Carbon Tax – Wall Street Journal, 9/16/2021

• Democrats are taking a fresh look at their proposals for reducing carbon emissions in their $3.5 trillion spending package, hoping to win over moderate party members who raised concerns about elements of the plan.
• Democrats have laid out a variety of provisions aimed at combating climate change in the wide-ranging proposal, including tax credits for purchasing electric vehicles, a program to push utilities to produce more clean electricity and a fee on methane emissions.
• Sen. Joe Manchin (D., W.Va.), who represents a top coal-producing state and is the chairman of the Senate Energy and Natural Resources Committee, has lambasted the proposal. He argued that market forces are already moving electricity suppliers away from fossil fuels.
• Mr. Manchin isn’t alone in his criticism of the plan.
• Some Democrats questioned whether the plan would disadvantage states that have already transitioned away from fossil fuels, while other colleagues echoed Mr. Manchin’s concerns about supplanting market forces.

Drug-Prices Measure Splinters House Democrats – Wall Street Journal, 9/16/2021

• Democratic divisions spilled into the open Wednesday over how to lower prescription drug prices as part of a broader $3.5 trillion budget package, signaling the challenge Democratic leaders face ironing out internal disagreements over a marquee component of the legislation.
• Democratic Reps. Scott Peters of California, Kurt Schrader of Oregon and Kathleen Rice of New York voted against a measure enabling Medicare to negotiate for lower prescription drug costs in a House Energy and Commerce Committee vote Wednesday, preventing it from advancing when the panel deadlocked in a 29-29 tie.
• Democratic leaders will need to find a consensus, given their narrow margins in both chambers. On legislation opposed by all Republicans, Democrats can afford no more than three defections in the House and none in the Senate.

Women Are Nearly Half of New Gun Buyers, Study Finds – Wall Street Journal, 9/16/2021

• Close to half of all new U.S. gun buyers since the beginning of 2019 have been women, a shift for a market long dominated by men, according to a new study.
• The preliminary results from the 2021 National Firearms Survey, designed by Deborah Azrael of the Harvard T.H. Chan School of Public Health and Matthew Miller of Northeastern University, show an estimated 3.5 million women became new gun owners from January 2019 through April of this year. About 4 million men became new gun owners over that period, they found.
• For decades, other surveys have found that around 10% to 20% of American gun owners were women.
• The number of federal background checks for gun purchases hit an all-time high in 2020 of 21 million, according to an analysis of federal data by the National Shooting Sports Foundation, an industry trade group.

U.S. Mortgage Rates Dip Slightly to Lowest in Almost a Month – Bloomberg, 9/16/2021

• Mortgage rates in the U.S. slipped to the lowest level in almost a month.
• The average for a 30-year loan was 2.86%, down from 2.88% last week and the lowest since Aug. 19, Freddie Mac said in a statement Thursday.
• The 30-year average sunk throughout 2020 and reached a record low of 2.65% at the beginning of this year. It has climbed since then, tracking yields for 10-year Treasuries, which have been above 1% since January.

Growth of NY service sector business activity slowed in September, survey finds – Reuters, 9/16/2021

• Business activity for service sector firms in the New York region continued to grow in September but at a slower pace, according to a survey released on Thursday by the New York Federal Reserve.
• The New York Fed’s business activity index fell thirteen points to 14.4, the third consecutive monthly decline for the survey covering firms in New York, northern New Jersey, and southwestern Connecticut.

EUROPE & WORLD

Taiwan Plans to Bulk Up Military Budget to Contend With Chinese Pressure – Wall Street Journal, 9/16/2021

• Taiwan plans to significantly increase military spending in the next five years, according to a draft bill that calls for new outlays on weapons systems that would better equip the island to repel an attack by China.
• The proposal, unveiled by Taiwan’s cabinet on Thursday, calls for the allocation of the equivalent of about $8.7 billion over the next five years to fund the acquisition of homegrown precision missiles, high-performance naval ships and weapons systems for existing warships.
• The new spending would be on top of Taiwan’s annual military-related budget, which is set to grow 4% in 2022 to a record $15.1 billion.

Factmonster – TODAY in HISTORY

• Mexico began its revolt against Spanish rule. (1810)
• General Motors was founded by William C. Durant. (1908)
• President Ford announced conditional amnesty for Vietnam War deserters and draft evaders. (1974)