Advert Costs – Gutenberg Thu, 11 Aug 2022 09:27:34 +0000 en-US hourly 1 Advert Costs – Gutenberg 32 32 Disney overtakes Netflix on streaming subscribers and sets higher prices Thu, 11 Aug 2022 00:39:00 +0000

LOS ANGELES, Aug 10 (Reuters) – Walt Disney Co (DIS.N) has edged out Netflix Inc (NFLX.O) with a total of 221 million streaming customers and said it will raise prices for customers who want watch Disney+ or Hulu without ads.

The media giant will increase the monthly cost of ad-free Disney+ by 38% to $10.99 in December when it begins offering a new option that includes ads for the current price.

Shares of Disney rose 6.9% in after-hours trading to hit $120.15 on Wednesday.

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In 2017, Disney staked its future on creating a streaming service to rival Netflix as audiences shifted to online viewing from traditional cable and broadcast television.

Five years later, Disney has overtaken Netflix in total streaming customers. The Mouse House added 14.4 million Disney+ customers, beating the 10 million consensus expected by analysts polled by FactSet, when the “Star Wars” series “Obi-Wan Kenobi” and “Ms. Marvel” by Marvel.

Combined with Hulu and ESPN+, Disney said it had 221.1 million streaming subscribers at the end of the June quarter. Netflix said it has 220.7 million streaming subscribers.

“Disney is gaining market share as Netflix struggles to add more subscribers,” analyst Haris Anwar said. “Disney has even more room to grow in international markets where it is rolling out its service quickly and attracting new customers.”

To help attract new customers, Disney will offer an ad-supported version starting Dec. 8 for $7.99 per month, the same price it currently charges for the ad-free version, the company said.

Hulu’s prices will increase by $1 to $2 per month in December depending on the plan.

A smartphone screen displaying the ‘Disney+’ logo is seen in front of the words ‘streaming service’ in this illustration taken March 24, 2020. REUTERS/Dado Ruvic

The company on Wednesday lowered its long-term subscriber forecast for Disney+ customers, blaming the loss of cricketing rights in India.

Disney now expects between 215 million and 245 million total Disney+ customers by the end of September 2024. This is down from the 230 million to 260 million that Disney had forecast.

The adjustment came from lowered expectations for India, where the company is losing streaming rights for Indian Premier League cricket matches.

For the first time, Disney has released estimates for Disney+ Hotstar customers in India compared to the rest of Disney+.

Chief Financial Officer Christine McCarthy said Disney plans to add up to 80 million Disney+ Hotstar customers by September 2024, and between 135 million and 165 million more.

The company still expects its streaming TV unit to turn a profit in fiscal 2024, McCarthy said. In the last quarter, the division lost $1.1 billion.

For the fiscal third quarter ended July 2, Disney posted adjusted earnings per share of $1.09, up 36% from a year earlier, as guests filled its theme parks. Analysts polled by Refinitiv had expected a profit of 96 cents.

Operating profit more than doubled in the parks, experiences and products division to $3.6 billion.

Streaming losses weighed on the media and entertainment unit, whose profits fell 32% to nearly $1.4 billion.

Overall revenue rose 26% from a year earlier to $21.5 billion, ahead of analyst consensus of $20.96 billion.

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Reporting by Lisa Richwine and Dawn Chmielewski in Los Angeles Editing by Kenneth Li, Peter Henderson and Matthew Lewis

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Senior Qantas executives urged to volunteer as baggage handlers Tue, 09 Aug 2022 10:13:34 +0000


To tackle acute labor shortages resulting from the coronavirus pandemic, Australia’s national carrier has come up with an unlikely solution: asking senior executives to participate in the baggage carousel.

In a recent memo to employees, Qantas called on managers and executives to volunteer over the next three months for tasks such as sorting and scanning bags, moving them from belt loaders to aircraft and driving bag-carrying vehicles – called “tugs” – from the aircraft to the terminal. (A current driver’s license is required, the memo says.)

Given the training requirements of the job – which involves carrying bags weighing up to 70 pounds and riding safely on the tarmac – all corporate volunteers are asked to commit to “at least 12 to 18 hours on three shifts per week,” the memo reads.

The volunteers will be “embedded” within the ground handling teams, the memo from Qantas says. “This means you will be given a roster, scheduled to operate, and supervised and managed in the live operation by our ground handling partners.”

Travel is resuming after a long pandemic period in which Australians were mostly not allowed to leave the country or, in some cases, travel to other states. The company said it was grappling with a spike in cases of coronavirus and other illnesses, such as the flu, during the winter Down Under.

Australia reopens borders to tourists after almost two years

The airline industry around the world is grappling with the legacy of the coronavirus, which has led to chaotic travel scenes this summer: canceled flights, lost baggage and passenger caps at airports, including the airport of ‘Heathrow in London, which recently announced that it restrict the number of departing passengers to 100,000 per day.

According to the flight tracking company FlightAware, in the past two months, 2.2% of US carrier flights were canceled and 22% – or 260,000 flights – were delayed.

Much of the problem stems from an industry-wide labor shortage, as airlines misjudged how long it would take for travel to resume following the pandemic shutdowns. Qantas dismissed 1,700 ground handlers in 2020, outsourcing work in an effort to cut costs. The country’s workplace watchdog ruled the move illegal and Qantas is currently challenging this decision in court.

First there were flights to nowhere. Now there are “mystery flights”.

Sydney Airport has been rated among the worst in the world for flight cancellations and delays, with lines that meander regularly outside the terminal.

A Qantas spokesman said on Tuesday the airline is aware that it “has not met the expectations of our customers or the standards we expect of ourselves”, which was partly the reason for the call from management.

Qantas Airways chief executive Alan Joyce initially accused “rust” or inexperienced travelers for long delays at the airport.

About 200 head office employees have responded to airports during peak periods since Easter, the spokesperson said. The memo calls for at least 100 managers and executives to volunteer for this round.

“As we manage the impacts of a record flu season and ongoing COVID cases coupled with the tightest labor market in decades, we are continuing this contingency planning in our airport operations for the next three months.” , said the spokesperson.

]]> Democrats hit roadblock, but push Biden package to Senate Sun, 07 Aug 2022 18:46:45 +0000


WASHINGTON — Democrats ran into trouble Sunday in their push for the Senate to pass a election year economic packageworking hard to overcome a glitch in a proposed new corporate tax that would help pay for the party’s deep-rooted goals of lowering Health care costs, invest in climate change and deficit reduction.

If the $740 billion measure is less ambitious than The original vision of President Joe Biden, that would be a substantial achievement and is the reason senators stayed up all night during a voting session that began on Saturday. So far, Democrats have swept aside more than two dozen Republican amendments intended to torpedo him.

Despite unanimous opposition from the GOP, House Democrats 50-50 were unified, buoyed by Vice President Kamala Harris’ decisive vote, suggesting the party is heading for a morale-boosting victory three months from the election when control of Congress hangs in the balance .

“I think it will pass,” Biden told reporters as he left the White House early Sunday to travel to Rehoboth Beach, Delaware, ending his COVID-19 isolation. The House appeared on track to provide final congressional approval when it briefly returns from summer recess on Friday.

But concerns over objections to the new 15% minimum corporate tax that private equity firms and other industries threatened to slow progress.

Sen. John Thune of South Dakota, the second-ranking Republican, was working on an amendment that would remove the tax for certain sectors. He was trying to draw support from the Democratic Sens party. Kyrsten Sinema of Arizona and Joe Manchin of West Virginia, two resisters who have resisted their party before.

Thune predicted several more hours of negotiations and debates. “I hope we have a solution to land the plane,” he told reporters on Capitol Hill.

Despite the momentary setback, the “Cutting Inflation Act” would give Democrats a campaign season showcase to act on coveted goals. It includes the largest-ever federal effort on climate change, at nearly $400 billion, caps Medicare drug costs for seniors at $2,000 a year, and extends expiring subsidies that help 13 million people. to afford health insurance.

Barely more than a tenth the size of Biden’s initial rainbow of $3.5 trillion 10-year progressive aspirations in his Build Back Better initiative, the new package drops its proposals for universal pre-school education, paid family leave and expanded childcare support.

Biden’s initial measure collapsed after Manchin objected, saying it was too costly and would fuel inflation. Nonpartisan analysts have said the current bill would have a minor effect on soaring consumer prices.

Republicans said the measure would undermine an economy that policymakers are struggling to prevent from plunging into recession. They said the bill’s business taxes would hurt job creation and drive up prices, making it harder for people to deal with the country’s crisis. worst inflation since the 1980s.

In a test imposed on all budget bills like this, the Senate endured an uninterrupted “vote-a-rama” of sweeping amendments. Each has tested Democrats’ ability to stay together a compromise brokered by Senate Majority Leader Chuck Schumer, D.N.Y., with Progressives, Manchin and Sinema.

Sen. Bernie Sanders, I-Vt., proposed amendments to further expand the health benefits of the legislation, and those efforts were defeated. Most of the votes were forced by Republicans and many were designed to make Democrats look lenient on US-Mexico border security and gas and energy costs, and like bullies for wanting to bolster the IRS tax law enforcement.

Before debate began on Saturday, the bill’s prescription drug price restrictions were watered down by the nonpartisan Senate congressman. Elizabeth MacDonough, who arbitrates questions on chamber proceedings, said a provision should fall that would impose costly penalties on drugmakers whose price increases for private insurers exceed inflation.

It was the bill’s main protection for the 180 million people with private medical coverage that they get through work or buy themselves. Under special procedures that will allow Democrats to pass their bill by a simple majority without the usual 60-vote margin, its provisions must focus more on dollar-and-cent budget numbers than policy changes .

But the bulk of their pharma price talk remained. This involved letting Medicare negotiate what it pays for drugs for its 64 million elderly beneficiaries, penalizing manufacturers for outpacing inflation on pharmaceuticals sold to Medicare, and limiting drug costs for beneficiaries. at $2,000 per year.

The bill would also cap Medicare patient costs for insulin, the expensive diabetes drug, at $35 a month. Democrats wanted to extend the $35 cap to private insurers, but that went against Senate rules. Most Republicans voted to drop it from the package, although in a sign of the political might of health care costs, seven GOP senators joined Democrats in an attempt to preserve it.

The measure’s final costs have been recalculated to reflect the late changes, but overall would bring in more than $700 billion over a decade. The money would come from a minimum 15% tax on a handful of corporations with annual profits over $1 billion, a 1% tax on corporations that buy back their own stock, strengthening of IRS tax collections and government savings from lower drug costs.

Sinema forced Democrats to scrap a plan to prevent wealthy hedge fund managers from paying less than personal income tax rates on their earnings. She also joined other Western senators in winning $4 billion to fight drought in the region.

It was on the energy and environment side that the compromise was most evident between the progressives and Manchin, a champion of his state’s fossil fuels and coal industry.

Clean energy would be encouraged by tax credits for the purchase of electric vehicles and the manufacture of solar panels and wind turbines. There would be household energy rebates, funds for building factories developing clean energy technologies and money to promote climate-friendly farming practices and reduce pollution in minority communities.

Manchin won billions to help power plants reduce their carbon emissions, as well as language demanding more government auctions for oil drilling on federal lands and waters. Party leaders have also promised to push separate legislation this fall to expedite permits for energy projects, which Manchin wants to include a near-complete gas pipeline in his state.

]]> Carbon dioxide shortage worries craft breweries Sat, 06 Aug 2022 01:41:00 +0000


IPAs and lagers aren’t the only things brewing at craft beer makers this summer – there are also issues in the making, with a carbon dioxide shortage driving up prices and slowing production. production.

The culprit is the dreaded phrase “supply chain issues,” a familiar pandemic-era misfortune that, in this case, covers a range of issues, from increased seasonal demand to contamination of a key supplier.

For industry veterans, the CO2 shortage is nothing new. Last year, Alewerks Brewery had to shut down production for a week due to a limited gas supply, said Michael Claar, operations manager for the Williamsburg, Va.-based brewery. Claar was unsure of the cause of this shortage.

Alewerks was able to get CO2 this year, but it comes at a cost: a 20% surcharge on gas deliveries, Claar said. This is one more price increase among many for breweries, which are facing generalized inflation on everything necessary for the production and packaging of beer: barley, hops, bottles, labels… you name it. Alewerks has tried to absorb much of the costs, even though the brewery plans to raise prices this year.

“Just for now, we’re trying to resist,” Claar said.

Breweries depend on CO2 not only for the bubbles beer drinkers expect, but also to move beer between tanks or to kegs and canning lines, and to purge oxygen from tanks. “Hot and flat isn’t where it’s at,” noted Bob Pease, president and CEO of the Brewers Association, which represents small, independent craft breweries. “It’s a key ingredient.”

Shortages began in mid-2020, he said, when ethanol production – of which carbon dioxide is a byproduct – slowed down as more and more people stayed at home. This summer, however, the problem is more acute, he says.

Contamination at a site in Jackson Dome, Mississippi, which is one of the nation’s largest CO2 producers, adds to the problem, the Brewers Association wrote in its July newsletter. There, raw gas from a mine reduced the amount of food-grade CO2 available. Another factor is planned and unplanned maintenance shutdowns at several ammonia plants that are key CO2 producers, the association said, as well as the usually higher demand during the summer months. This is partly due to higher sales of beer and soda in warmer temperatures, and also due to butterfly wing effects such as a need for more dry ice – which also uses CO2 in its production.

Many breweries are reporting spikes in the cost of CO2, Pease said, and some are unable to get as much as they need. “We’re hearing people who their CO2 supplier has called saying, ‘We were supposed to deliver 100 pounds, but we’re only able to deliver 40,'” he said. “So they might have to change their production schedule, and the end result might be a beer shortage if that persists.”

Still, he hopes the supply issue will be resolved in 30 to 90 days.

However, the shortage did not affect all breweries. Some small producers have so far remained sheltered. Warren Stanko, chief brewer at Chattanooga Brewing Co. in Tennessee, saw no disruption to his CO2 supply, despite only producing about 2,000 barrels of beer per year compared to, say, the 9,275 barrels produced annually at Alewerks.

For microbreweries, however, even small price increases can be difficult to absorb at this stage of the pandemic. Christopher Gandsy, the founder, chef and head brewer of DaleView Biscuits and Beer in Brooklyn, says he was proud to be debt-free when he opened his business in 2018. But when the pandemic hit, Gandsy had to suffer an economic catastrophe. Loan from the Small Business Administration. The $90,000 loan comes on top of economic pressures he already faces, including rising water and electricity costs.

Gandsy hasn’t had to refill his 200-pound CO2 tank since the shortage hit the industry. But even then he had to pay about 10% more than a few months earlier. He is preparing for the CO2 price in September, when he will have to fill the tank.

“Most commodity disruptions disproportionately impact smaller players in a segment, so yes, the CO2 shortage is disproportionately affecting smaller craft brewers,” Pease told The Washington Post. “Large brewers may also have a technology called carbon capture in their breweries that helps protect them from supply disruptions.”

The recurring shortage of carbon dioxide has at least one small brewery looking for ways to capture the CO2 naturally produced during the fermentation process. Alewerks is investigating the possibility, said Claar, the chief operating officer. It’s not a cheap process, he said, but it could help offset Alewerks’ CO2 needs.

“Based on everything that’s happening now, we have to dive in,” Claar said.

The Brewers Association has released guidelines for brewers to help them get the most out of their carbon dioxide, including making sure there are no leaks in their lines. Pease says brewers have grown accustomed to setbacks: Earlier this year, Ball Corp., the largest can supplier, quintupled its minimum order, forcing many breweries to seek out different suppliers, often at higher cost. Other successes include rising labor, transportation, and other ingredient costs.

“Our members have faced a long series of challenges, and we’ve found ways to overcome most of them,” Pease said. “We will try to help our members overcome this one.”

]]> Germany’s switch to diesel from gas comes at a cost Thu, 04 Aug 2022 09:43:14 +0000


Leaders across Germany have spent the past few months playing warfare over how to react if Russian President Vladimir Putin cut off gas supplies. And many, from small companies to global behemoths, have come to the same solution: going oil.

In Munich, the municipal utility converted two gas boilers to run on diesel. Further south in the German Alps, the agricultural cooperative Berchtesgadener Land sent two dairy truck drivers to learn how to operate an oil rig, in case they needed to buy. To the north, the Veltins beer brewery near Düsseldorf has stored five weeks worth of diesel to prepare for an emergency switch away from gas.

In some cases, this involves burning fuel oil in boilers and steam generators that previously operated on natural gas; in others, it involves running diesel generators to avoid power outages.

Berlin quietly encourages change. Wiegand-Glas, which produces glass bottles, was able to obtain the necessary documents to have its ovens ready to run on oil rather than gas in a matter of days, for example. “I promised to reduce bureaucracy when converting systems to an absolute minimum,” said Anja Siegesmund, the regional environment minister.

Privately, oil traders say they receive inquiries from German companies that have never bought fuel oil or diesel before, or abandoned the practice many years or even decades ago.

Take Covestro AG, a chemical company that produces the building blocks of plastics. For years, it relied on natural gas. But earlier this week it told investors during its second quarter results presentation that it was “dropping various measures to reduce its gas needs in Germany in the short term, such as switching to steam generators based on oil”.

The incentive to reduce gas consumption is huge after Putin cut supplies to Germany via the Nord Steam 1 gas pipeline. The Dutch gas contract TTF, a European benchmark, is trading above 205 euros (209 $) per megawatt-hour, 10 times its decade-to-2020 average and equates to about $350 a barrel of oil. Meanwhile, Brent crude is hovering around $100 a barrel. Hans-Ulrich Engel, chief financial officer of BASF SE, did the math earlier this month: at current prices, “it may actually be cheaper to use, for example, fuel oil to produce your steam, than to use very expensive natural gas”. he said.

The consequences are twofold. German industry, long accustomed to operating on cheap Russian energy supplies, may be able to reduce its dependence on gas more than previously thought without having to shut down completely. German gas demand is already well below its five-year average for this time of year. Morgan Stanley estimates that German industrial gas consumption fell 24% in July compared to the same month in 2021. If the trend continues, gas prices in Europe may not rise as much as expected, even if Putin stops altogether exports later this year. The worst-case scenario, with TTF prices exceeding 300 euros or even 400 euros, can be avoided. But the corollary could be an increase in demand for German oil this winter well above anything currently estimated, which could push up global oil prices.

The magnitude of the potential for additional oil consumption is hotly debated, with bears and bulls providing good reason for optimism and pessimism. Last year, oil bulls were anticipating a significant increase in demand from oil-fired power plants that never materialized. Nevertheless, Energy Aspects Ltd., a consultant, estimates that if all of Europe’s oil-fired power plants were running this winter, it would add an additional 340,000 barrels per day to demand on the continent. To put that into context, it is higher than the 200,000 barrel per day increase in European oil demand projected by the International Energy Agency for 2023.

Additionally, these figures do not take into account the potential explosion in the use of diesel generators and the use of oil and fuel oil in industrial boilers and steam generators. With little hard data on how many companies have refurbished their boilers to run on oil and how many others have purchased standby generators, any estimate is more guesswork than guesswork. forecast. Yet some oil traders and consultants are injecting an additional 200,000 barrels a day into Germany and neighboring countries.

The transition from gas to oil, however, comes up against enormous obstacles. BASF, the German chemical juggernaut, is paradigmatic of the difficulties. In a presentation to investors last week, the company said preparations to replace natural gas with, for example, fuel oil were “progressing well”, echoing what other German companies have said in recent years. weeks. But it included a big caveat in a small footnote: “The prerequisite is the sufficient availability of fuel oil.”

If companies in Europe’s biggest economy simultaneously switch from oil to gas this winter, it could potentially trade one problem – gas shortages – for a second problem – a tighter market for diesel.

For now, European diesel has stabilized at around $1,000 per metric ton, down from a record high of around $1,500 in early March, days after the Russian invasion of Ukraine. Still, the market will have to grapple with the upcoming ban on Russian refined products, which will take full effect in early February and cut diesel supplies in Europe just when buying could peak.

Diesel is the workhorse of the global economy. Since the start of the crisis, it has been the most popular refined product, even if it is often eclipsed by gasoline prices in the United States. As German industry prepares to wean itself off Russian gas in the coming months, diesel prices could start to hit the headlines – for all the wrong reasons.

More from Bloomberg Opinion:

London paid record price to avoid blackout: Javier Blas

Having trouble staying cool? The same goes for the generator that powers your air conditioning: David Fickling

Putin’s New Weapon of Mass Disruption: Kazakh Oil: Julian Lee

This column does not necessarily reflect the opinion of the Editorial Board or of Bloomberg LP and its owners.

Javier Blas is a Bloomberg Opinion columnist covering energy and commodities. A former Bloomberg News reporter and commodities editor at the Financial Times, he is co-author of “The World for Sale: Money, Power and the Traders Who Barter the Earth’s Resources.”

More stories like this are available at

]]> Red America Should Love Green Energy Spending Tue, 02 Aug 2022 18:47:32 +0000


The standard renewable energy policy color code holds that green mixes with blue but clashes with red. A detailed look at local realities says otherwise.

Enersection, a new Houston-based company specializing in data-driven insights into the US energy system, has presented it in compelling charts and other graphics (you can access their site here). Bloomberg Opinion has partnered with co-founder Jeff Davies to dig deeper into the energy and emissions landscape at the congressional district level, using data from the Energy Information Administration’s Monthly Electricity Report (EIA 860 -M).

The picture that emerges will probably surprise you.

House Minority Leader and likely Republican President-in-Waiting Kevin McCarthy has complained that Democrats prefer to leave US oil and gas resources in the ground, even if it means begging for “batteries from China.”

Nothing particularly upsetting there. What’s interesting, though, is that many of these craved batteries look set to land in California’s 23rd congressional district, represented by McCarthy. Indeed, EIA’s geotagging data shows that his district ranks first in the country for planned and operating grid battery projects. The McCarthy District also ranks first for planned and operational solar capacity at the utility scale and second when you combine wind, solar and batteries. It is a dark green-red neighborhood.

McCarthy’s neighborhood captures a wide disconnect between facts on the ground and political identities when it comes to green energy.

Further to the right is Colorado’s 3rd district, represented by Lauren Boebert. In January 2021, she responded to the United States’ re-entry into the Paris Agreement by tweeting that she was working “for the people of Pueblo, not the people of Paris.” Ironic, really, since Pueblo, one of the largest cities in its district, has a goal of 100% renewable electricity and is becoming a regional clean energy hub. Overall, Boebert District ranks 16th out of 435 districts for planned renewable energy capacity.

Elsewhere in Congress and in Colorado is Diana DeGette, the Democratic representative for the state’s 1st district and chair of the House Energy and Commerce Subcommittee on Oversight and Investigation. At just 23 megawatts, his district barely registers in planned and operational solar, wind and battery capacity. Meanwhile, DeGette’s fellow Democrat, Kathy Castor, who chairs the House Select Committee on the Climate Crisis, represents Florida’s solidly blue 14th district — which ranks 354th in the nation.

Enersection’s detailed district-level graphs can be accessed here for desktop users. On just about every metric you want to look at, physical assets in the green transition are more often found on a red background than on a blue background.

The most obvious reason for this is the floor itself.

The wind offers the best example. The best place to install wind turbines is where there is a lot of open space and where the wind is blowing very hard. Only about 10 states between the Mississippi River and the Rocky Mountains account for 80% of U.S. onshore wind potential, and that region is in red bias: 70% of House districts in those states have Republican representatives.(1)

Rural and semi-rural districts offer more open and cheaper spaces to locate electrical infrastructure than urban and suburban areas which tend to vote blue. Even in states that bow in blue, wind capacity tends to be built in districts with Republican representatives. Of the top 15 districts for existing and planned wind capacity in states won by Joe Biden in 2020, 13 are red.

Using the Bloomberg CityLab Congressional Density Index, Enersection mapped the location of green energy projects in home neighborhoods, segmented by type. Rural and rural-suburban areas dominate for solar and, especially, wind projects. Batteries, with greater variability in scale and application, are more evenly distributed.

McCarthy District is centered in Bakersfield, Kern County, the oil capital of California. To the east is the Tehachapi region, home of the state’s wind industry, and the solar power plants of the Mojave Desert. The 23 is therefore both a hub for renewable energies and for fossil fuels. Indeed, in his first two sessions of Congress, McCarthy sponsored bills to subsidize wind and solar power. Additionally, because it is home to several large natural gas-fired power plants and fuel processing sites, the district ranks among the top 40 nationally in greenhouse gas emissions from industrial facilities.

Some complexity defying the tweets there, and that extends across the country. Whether it’s planned solar, wind or battery capacity, 21, 21 and 15 of the nation’s 25 major congressional districts, respectively, are Republican. At the same time, 20 of the 25 districts with the highest greenhouse gas emissions from industrial sites — which collectively make up a third of the national total — are also Republicans. The vast majority of these relate to coal-fired power plants, usually located far from city centers.

Perhaps US green energy policy is not so much color blind as deliberately blind. “Rocks, wind and sun do not belong to political parties; the people who live there do,” says Kevin Book of ClearView Energy Partners, a Washington-based analytics firm.

As much as green energy and emissions now form a wedge issue between blue America and red America, the data shows a much more purple reality. On the one hand, Democratic Reps who call for green stimulus dollars often implicitly direct them to red light districts, because that’s where a lot of stuff will actually be built. Republicans who denounce renewable energy as unreliable are often rhetorically at odds with a growing business in their home region.

All of this takes on added importance in the wake of the cleantech stimulus package suddenly revived by Biden via the Cut Inflation Bill. While its passage would hinge on a strictly blue budget reconciliation process, Republicans have at least one reason to (quietly) encourage it: a lot of the money would be spent in the areas they represent. Applying benchmark capital cost estimates for wind, solar and battery projects from Bloomberg NEF and the National Renewable Energy Laboratory to projected capacity implies a $107 billion investment opportunity, of which nearly four fifths in red districts.(2)

“The solar industry wants the same things the oil industry wants,” Book says, pointing to things like faster permits and lower taxes. With green energy easily growing in red soil and growing a new constituency, this alignment of interests should one day surpass the discord of ideology.

More other Bloomberg Opinion writers:

• Surprising places where all-electric dominates: Justin Fox

• The rich-poor divide on clean energy is widening: David Fickling

• GOP climate plan forgets climate: Liam Denning

(1) Iowa, Kansas, Minnesota, Montana, Nebraska, New Mexico, North Dakota, Oklahoma, South Dakota, Texas and Wyoming.

(2) This assumes 18, 56, and 16 gigawatts of planned wind, solar, and battery capacity at estimated capital costs of $1.58, $1.04, and $1.20 per watt, respectively. Solar and wind costs are for utility-scale tracking and onshore projects, respectively, according to Bloomberg NEF estimates for the first half of 2022. Battery costs are for a five-hour system, according to the “Report Storage Technology Modeling Input Data” from NREL.

This column does not necessarily reflect the opinion of the Editorial Board or of Bloomberg LP and its owners.

Liam Denning is a Bloomberg Opinion columnist covering energy and commodities. A former investment banker, he was editor of the Heard on the Street section of the Wall Street Journal and a reporter for the Lex section of the Financial Times.

Jeff Davies is co-founder of Enersection, a data-driven visual energy insights platform. He previously invested in the energy sector as a fund manager.

More stories like this are available at

]]> As one Evergrande falls, another rises in the Saudi desert Mon, 01 Aug 2022 02:35:27 +0000


Everything about Neom – the futuristic city developed near the shores of the Red Sea by Saudi Crown Prince Mohammed bin Salman – sounds fantastic.

From flying elevators to 100-mile-long skyscrapers to a carbon-free floating port, it seems to owe more to Coruscant and Wakanda than any urban form outside of sci-fi.

Even Neom’s finances are superlative. The first phase of the project until 2030 will cost 1.2 trillion riyals ($320 billion), half of which will be provided by the Public Investment Fund, Saudi Arabia’s sovereign wealth fund, Crown Prince Mohammed said bin Salman to reporters in Jeddah this week. By 2030, he expects around 1.5 million people to live in the twin horizontal skyscrapers, called The Line.

Believe it or not, these numbers are not as implausible as they seem. Take China Evergrande Group, the vast Chinese developer that became mired in vague restructuring plans after ratings agencies called it defaulter last year. Neom’s promise of eventually becoming home to 10 million people seems, if anything, modest next to Evergrande’s boast that it’s home to 12 million. Evergrande’s investment fund outflow, net of divestments, has been 605 billion yuan ($89 billion) since 2010, or about 28% of Neom’s budget. Given that China’s income levels and construction costs have been around 40% of Saudi Arabia’s over the past decade, this suggests a rather generous budget, but far from insane.

Of course, if you had to pick a role model for Saudi Arabia’s future, it probably wouldn’t be a struggling developer of a Chinese real estate sector that S&P Global Ratings says could be headed as a whole for the future. insolvency.

Yet the biggest problem with Neom is not so much its cost and its scale. Instead, it’s how the grandiosity of the will to power is baked into its very DNA, as Vivian Nereim explored in a recent Bloomberg BusinessWeek article.

Despite all of Evergrande’s troubles, he was always a fairly efficient user of capital. One of the reasons he has been hit by mortgage strikes recently is because he was dependent on pre-sales, in effect getting interest-free loans from his clients for the full value of properties before they were built – which becomes a problem when construction works are taking place. on an extended break. The fastest developers in China could complete a project in 12 months, from concept to return of money. At least in its early years, Evergrande’s numbers suggested it was consistently earning more than its cost of capital.

The foundations of its business model were essentially solid. Some 200 million people have moved into Chinese cities over the past decade, while nominal gross domestic product per capita has doubled. It’s a fascinating story of organic urban growth. Indeed, much of Evergrande’s downfall can be attributed to the way he attempted to counter organic tendencies for political reasons. Beijing wants to see rural migrants move to smaller, so-called “Tier 3” cities in preference to its crowded and bustling east coast metropolises. Evergrande’s land reserve became increasingly concentrated in these lesser quality locations. This attempt to reverse the gravitational pull of the country’s centers of economic power was always likely to end in tears.

If a real estate developer focused on China’s Tier 3 cities can turn into a disaster, how do you assess the prospects of a brand new city in a desert far removed from both the oil fields and the unique pilgrimage destinations of Mecca and Medina? ? Neom’s vision of a carbon-free life for the 21st century is alluring – but if realized, the economic prospects for the nation that uses billions of oil dollars to build it are truly bleak. A world in which Neom’s innovations in urban living work is a world in which Saudi Arabia’s main exports are superfluous. While Neom is intended more as a rebranding exercise for a country determined to sell every last drop of its rough, there are much cheaper ways to recalibrate your public image.

The lesson Saudi Arabia should take from Evergrande is that infrastructure and real estate development works best when they follow people, rather than trying to lead them. The kingdom will benefit much more from the monotonous metro networks being built in Riyadh, Mecca, Medina and Jeddah, and its long-delayed cross-border rail corridor, than from another aborted construction project on the shores of the Red Sea to join its predecessor. , the economic city of King Abdullah. Likewise, the effective realization of its plans to exploit its vast and barely used solar and wind resources would provide cheaper energy locally while freeing up oil for export.

Mohammed bin Salman has his work cut out to fix his country’s sprawling, congested cities for a population of some 36 million that is set to grow by a third by 2050. That task is difficult enough amid the signs that oil demand could decline, even as Saudi Arabia’s supply potential appears to be plateauing. It would be a much better use of the kingdom’s cash than a vast madness in the desert. Despite all of Evergrande’s mistakes, he never tried to build his castles in the air.

More from Bloomberg Opinion:

• Saudi Arabia reveals that oil production is near its ceiling: Javier Blas

• Saudi megaproject is big on hubris and impractical: Bobby Ghosh

• How Saudi Arabia can thrive in a post-oil world: David Fickling

This column does not necessarily reflect the opinion of the Editorial Board or of Bloomberg LP and its owners.

David Fickling is a Bloomberg Opinion columnist covering energy and commodities. Previously, he worked for Bloomberg News, the Wall Street Journal and the Financial Times.

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]]> Poor, minority communities more likely to have bad roads, study finds Sat, 30 Jul 2022 02:09:47 +0000


Poor communities, urban areas and those with few white residents are more likely to have potholed, cracked and potholed roads, according to a new analysis of 220,000 miles of busy streets and highways across the country.

The studyreleased Thursday by the Government Accountability Office, examined the condition of road surfaces across the country and found that disparities are evident even after accounting for traffic volume and weather conditions.

The findings point to another inequity in the nation’s transportation network at a time when the Biden administration says it is trying to use money from the $1 trillion infrastructure act to build a fairer system. Federal authorities set aside funds to dismantle highways built through black communities in the 20th century, but the study shows some communities lack even the basic investments that would bring smooth, paved roads.

Federal authorities classify roads as being in good, fair or poor condition. The researchers found that in otherwise similar locations, there was a 7% chance that a road in an urban neighborhood had almost no healthy white residents. In an almost entirely white urban neighborhood, that figure was 22%.

Road deaths have increased during the pandemic. The toll fell more heavily on black residents, according to the report.

Kyle Shelton, director of the Center for Transportation Studies at the University of Minnesota, said he was not surprised by the results, adding that efforts to measure inequality in the transportation system are relatively new. He called the report a “stepping stone” that should stimulate further research.

“That’s the kind of baseline study that needs to be done to say, ‘here’s where some of the problem areas are,'” he said. “The takeaway is, ‘yes, there’s probably an equity issue.'”

Shelton said the results likely reflect a long-standing tension between building roads to support fast-growing suburbs and maintaining existing streets, as well as poorer communities’ low level of access to political power.

Federal transportation funding is typically passed on to state transportation agencies, which decide where to spend the money. Urban leaders have complained that these agencies tend to favor the needs of suburban commuters, who are often wealthier and whiter than many city dwellers.

GAO researchers found that the Federal Highway Administration does not systematically track different road conditions within states or use its data to identify disparities related to race and income. The watchdog urged the agency to conduct its own analysis and develop strategies to ensure fairer investments in highways.

“Because FHWA has not generally analyzed state pavement conditions, such as at the local level, it is unaware of pavement issues that could pose risks to its strategic objectives, such as concentrations of poor road conditions in a state or differences that disproportionately affect the underserved. communities,” the researchers wrote.

The Department of Transportation, which oversees the FHWA, said it partially agrees with the recommendations, adding that it plans to review where federal highway funding is being spent.

“Using these findings, FHWA will identify potential strategies to help states mitigate investment decision-making processes that could potentially lead to inequitable outcomes,” the department wrote in a response to GAO. The agency declined to comment further.

Federal rules say ‘meaningful progress’ on infrastructure can mean more road deaths and decrepit bridges

The Highway Administration requires state departments of transportation to set statewide goals for road conditions, but the analysis was intended to demonstrate the differing conditions within states. GAO analyzed road conditions on what’s called the National Highway System, a 220,000-mile network that includes highways and smaller roads, and accounts for more than half of the miles traveled by vehicle nationwide. country.

Researchers have studied the road network in several ways.

They divided the country into 8 mile by 8 mile squares, identifying where more than 10% of major roads are in poor condition – well above the national average of 2.4%. This analysis identified clusters of bad roads in parts of California, Louisiana, New Jersey and Michigan, among other states.

The researchers then compared road condition data — typically looking at surface roughness — while taking demographic information into account to identify racial and income disparities. In the whitest census tracts, 1.3% of roads were in poor condition, compared to 3.7% in areas with the smallest proportions of white residents.

Although the study did not examine local streets, Shelton said he would expect similar patterns to continue. He said more research was needed to paint a picture of the country’s entire road network.

“This is a new mission for many agencies, and I think what we’re seeing across the board is this challenge that we don’t have a basic understanding,” he said. he declares.

The country’s neglected bus stops are an early test for infrastructure money

The GAO report builds on other research that found that blacks, Latinos and Native Americans are more likely to be killed in crashes, and that streets in neighborhoods with high proportions of minority residents tend to be more dangerous. The Department of Transportation also identified longer commutes for people who do not own a car and a higher burden of transportation costs for poorer families.

The department this year shared a plan to create a more equitable transportation system and has included racial equity criteria in its major grant programs.

The agency in July opened applications for funding under a new Reconnecting Communities pilot program, which will provide $1 billion to communities seeking to repair damage caused by highway construction. The money can be used to study the removal of freeways or find ways to reconnect neighborhoods with bridges or plugs that span sections of freeway.

]]> Global banks can take advantage of the Indian dollar crisis in style – Style 2013 Thu, 28 Jul 2022 02:17:02 +0000


Bangladesh seeks bailout from International Monetary Fund; Pakistan is expected to receive its own $1.2 billion bailout soon. Neither wants to end up with another Sri Lanka. The island nation has been dragged into a whirlwind of empty dollar coffers, popular anger over food, fuel and medicine shortages, political chaos and ever-worsening economic funk.

Of the major South Asian economies, only India remains standing. But the region’s largest economy is also faltering a bit.

Even after depleting 11% of its foreign exchange arsenal, the Reserve Bank of India has only managed to keep the rupee at an all-time low of around 80 to the dollar. Should New Delhi start applying for an IMF loan? Not so fast.

On the one hand, a strong dollar is not a big problem for balance sheets. Yes, Indian companies are adding pressure on the rupiah as they scramble to buy protection for their $79 billion in uncovered foreign debt. But about half of it – or $40 billion – is the responsibility of state-run borrowers. Their currency risk, as argued by RBI Governor Shaktikanta Das, can be absorbed by the government, although such an eventuality is unlikely to occur. As for reserves falling to $573 billion from $642 billion in October, “you’re buying an umbrella to use when it rains,” he said.

Governor Das failed to mention that he also has a raincoat handy against the heavy downpour caused by the relentless tightening of US interest rates. That would be India’s 18 million strong diaspora, the world’s largest community of people living outside their country of birth. Give them a juicy return and they will deposit hard currency term deposits with Indian banks, something they have done tirelessly in the past to get their homeland out of trouble.

Even better, wealthy non-resident Indians, or NRIs, will soon be hounded by their private bankers to take out low-cost loans and invest in India without any currency risk. In 2012, I saw a term sheet from a global bank offering to lend S$900,000 ($650,000) against S$100,000 of client equity. The total amount of S$1 million would be placed with an Indian bank as a non-resident foreign currency deposit. The annual return to the client, after paying the borrowing fee, was guaranteed at 10%, at a time when a Singapore dollar deposit was yielding 0.075%.

Then came the tapering scare in mid-2013 and a severe shortage of dollars for India, Indonesia, Brazil, Turkey and South Africa – the economies of the “fragile five”, as Morgan Stanley called them. . At the time, the RBI blessed this type of leveraged dollar raising from the diaspora by offering Indian banks a bargain to exchange their foreign currency funds for rupees. Indeed, India fabricated its own private bailout with a difference: the creditors – the NRIs who act as fronts for the global banks – could only ask for their money; they couldn’t demand that the government spend less or open the economy to more competition, or impose any of those conditions that make sovereign nations resent the IMF.

Looking at the clouds gathering on the horizon, it might not be too early for Das to start thinking of a similar plan B.

To some extent, the effort has already begun. After touching the patriotic hearts of NRI customers by telling them how their remittances are helping to create jobs and improve health and education facilities at home, the State Bank of India, the country’s largest lender, informs of the 2.85% it offers on dollar deposits. one to two years. That’s already generous: Hong Kong banks pay little more than 0.3% for 12-month US currency funds. The next step, after the 2013 playbook, would be for foreign banks to start funding NRIs so that instead of depositing, say, just $100,000, they could put up $1 million and get effect returns two-digit leverage.

Finally, the RBI could step in and offer to exchange the funds in dollars for rupees at a lower cost for borrowing Indian banks, which made the scheme a resounding success last time around.

India raised $26 billion via this channel in 2013, only a fraction of which was real NRI money, says Observatory Group analyst Ananth Narayan, a former Standard Chartered Plc banker. “The rest was overseas bank money lent to NRIs, coming in as NRI deposits.” From the country’s point of view, it was expensive. As Narayan notes in an article for the Moneycontrol website, India actually recouped three-year dollars at around 5%, a 4.35% spread over US Treasury yields at the time. “It was a high (if hidden) price to pay. A sovereign bond at this yield would have been a public relations disaster. Should the need arise again, it might be best to extend the cheap swap option beyond NRI funds to all dollars raised overseas for a reasonably long period, Narayan said. . This will help reduce the cost of the grant.

The bottom line, however, is that India is not in the same boat as its South Asian neighbors, even though it is in the same choppy waters. Bloomberg Economics raised its forecast for the upper end of the Federal Reserve’s policy rate to above the consensus level of 5% by mid-2023. Such a hawkish response to US inflation could easily knock a few more rays from the RBI’s foreign reserves umbrella as it tries to keep the rupee from weakening too fast and too soon. But Governor Das knows the Diaspora raincoat is dry, just in case India needs it.

More from this and other writers at Bloomberg Opinion:

• The RBI is getting its way on rates. So far: Andy Mukherjee

• The follow-up to Lagarde’s “Whatever It Takes” is not yet a success: John Authers

• The Fed must overcome these four failures: Mohamed El-Erian

This column does not necessarily reflect the opinion of the Editorial Board or of Bloomberg LP and its owners.

Andy Mukherjee is a Bloomberg Opinion columnist covering industrial companies and financial services in Asia. Previously, he worked for Reuters, the Straits Times and Bloomberg News.

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]]> What to Know About NFTs and the ‘Bored Monkey’ Boom and Bust Cycle Tue, 26 Jul 2022 02:49:41 +0000


Ever since NFTs, or non-fungible tokens, screamed into the public consciousness in 2020 with million-dollar sales of digital artifacts, the debate surrounding them has more or less gone like this: NFTs are the future of art and commerce! No, NFTs are a worthless scam! No, NFTs have a useful albeit limited future in doing something that is not quite clear yet! In the world of digital currencies, these are familiar arguments. The same goes for the boom and bust cycle that NFTs have gone through, with large sums of money gained and lost along the way. For example, the price to join the Bored Apes Yacht Club by purchasing an NFT of an image of a bored monkey soared to $420,430 before dropping almost 79% in June, while the JPG NFT Index, which tracks a handful of blue chip NFT projects, in June was down more than 70% since its inception in April.

1. What are non-fungible tokens?

Think of them as digital certificates of authenticity. An NFT is a unique and irreplaceable identifier created by an algorithm: a distinct barcode for a piece of digital art or a collectible. This helps solve a problem that digital artists have struggled with for a long time: how to create rarity for an item that can be reproduced endlessly. Uniqueness is the reason (ok, a reason) the Mona Lisa is priceless, while a Peter Max signed and numbered print of his version of the painting is $4,900 and Mona Lisa posters are 7, $95.

When an artist wishes to sell their digital work, they create, or “monetize”, an NFT which then becomes attached to the ownership of that specific work. NFTs are recorded on open blockchain ledgers, making it possible to track ownership (or, as we say in the physical world, “provenance”), past sale prices, and the number of copies in existence. The security provided by blockchain technology makes it harder to sell fake tokens than selling fake physical artwork, although it is not impossible. The price of NFTs is determined by its rarity and popularity. The Merge, for example, is an NFT made by artist PAK depicting three lunar masses on a black background. It sold for $91.8 million as of December 2021.

3. Are NFTs a kind of cryptocurrency?

No, although there are some similarities. Both NFTs and cryptocurrency are digital assets and are powered by the same types of decentralized blockchains. But in theory, the whole point of a cryptocurrency is that it can be used in transactions just like dollar bills – and what makes dollar bills useful is that they are identical and have little intrinsic value. An NFT, on the other hand, is a one-of-a-kind creation whose purpose is to protect ownership of a specific item.

4. What happened during the boom?

Before the pandemic, people had started finding new uses for NFTs as ways to sell sports memorabilia or special access passes to events. Then NFTs gained momentum among bored collectors in 2020 and took off the following year. Artists, celebrities and financial investors were buying NFTs, a boom that coincided with rising prices for Bitcoin and other cryptocurrencies. In March 2021, Jack Dorsey made an NFT of his first tweet and sold it for $2.9 million, and a digital artist by the name of Beeple sold an artwork for $69.3 million. Bored Apes, who are (literally) bored-looking animated monkeys, have become the favorite avatar of celebrities on Twitter, with Gwyneth Paltrow and Serena Williams sharing their personalized monkeys on social media. Owning NFTs has become a statement and golden ticket to accessing a network or intimate community – whether to a Discord server for fellow Bored Apes (the Bored Apes Yacht Club) or entry to a festival. of French film.

When NFTs became a popular investment choice for those looking to diversify their portfolio ahead of inflationary warnings, some critics saw the trend as mere hype. What buyers were getting, they said, was just the bragging rights of images that anyone could equally well see, copy or enjoy. Questions have been raised as to whether those benefiting from the parallel cryptocurrency boom were using some of their newfound wealth to inflate a market they would benefit from rising. Others have argued that for any work of art, the original hand of the master is what makes it valuable. And then there was that segment of Americans who simply didn’t understand what the fuss was about or why NFT vendors were getting millions of dollars.

6. Why has the market turned?

NFTs have been caught in a broad cryptocurrency price slide that has accelerated after the collapse of blockchain stablecoin Terra rattled investor confidence. The world’s largest NFT marketplace, OpenSea, saw sales volumes in June drop more than 70% month-over-month, according to Dune Analytics. OpenSea began laying off staff in July after the crypto crash to cut costs and prepare for a long-lasting downturn. A dizzying array of frauds wiping out hundreds of millions of dollars and cases of alleged insider trading have further tested the industry.

7. What would be left if the NFT bubble burst?

There is a chance that the current downturn will end the NFT frenzy from 2021. But the urge to mint money, whether through crypto, NFTs or otherwise, is not going away. NFTs have also proven useful in unexpected ways, such as raising $600,000 for the war in Ukraine through an NFT museum. Its uses extend to automobiles, games and of course the metaverse as it attracts more buyers. Yuga Labs, the company that developed the Bored Apes Yacht Club, launched land plots in the metaverse as NFTs called Otherdeeds, which recorded a $320 million transaction in late April.

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