| From: Don Green | 6/16/2024 1:07:03 PM | | | | | | Japan-style deflation rears ugly head amid Chinese price war
The Standard
An aggressive market grab by low-cost Chinese retailers has delivered bumper earnings for some firms but has also intensified a bruising price war, exacerbating deflationary fears.
From coffee to cars to clothes, they have cut prices on just about everything in chasing consumers whose confidence has been battered by a property crisis, high unemployment and a gloomy economic outlook.
While the downshift has propelled revenues for firms like discount e-commerce platform Pinduoduo, economists fear their success is entrenching a Japanese-style deflationary mindset in consumers that will be difficult to shake.
As retailers compete on price above all else, they force tough cost cuts on suppliers.
This in turn leads to lower wage growth or higher dependency on low-paid gig work, hurting household demand.
"If this continues, China may end up with a vicious cycle: lower value added consumption, deflation, low profit rates leading to low wages, which further pushes consumers to downgrade consumption," said Monash University economics professor Shi He-Ling in Melbourne.
In the most recent earnings season, revenues at PDD Holdings, owner of Pinduoduo, surged 131 percent while top food delivery app Meituan saw 25 percent growth. Discount retailer Miniso and Luckin Coffee grew 26 and 42 percent.
Data showed that China's consumer price index fell 0.1 percent in May from a month earlier, missing forecasts.
With consumer confidence near rock bottom, price is king.
Carmakers have been in a price war for two years. Over the past two months, some dealers and financing firms have launched loan programs with no down payment and even zero interest.
Starbucks, which saw China revenues decline 8 percent in the first quarter due to "fierce competition among value players," has increased use of discount coupons to bring prices closer to Luckin Coffee.
Food delivery giant Meituan CEO Wang Xing said last week it had expanded coupon offerings and onboarded more delivery-only kitchens with lower overheads than dine-in restaurants. The app's newer hotel booking business is pursuing what he called a "low star" strategy targeting cost-conscious domestic travelers.
Taobao and Tmall Group and JD.com, which saw single-digit growth, said price competitiveness will be key to growth.
Both companies have introduced longer sales periods for China's mid-year "618" shopping festival, with lowest-price guarantees for millions of products. In response, Pinduoduo has launched an "automated price-tracking system" to enable merchants to monitor and beat rivals.
A staff memo from JD.com founder Richard Liu describing his firm as "bloated" has led to speculation it will cut jobs - the opposite of what China needs for domestic demand to recover.
Longer term, price wars may take out weaker players in various industries, allowing rivals to then lift prices and give their supply chains some respite, but Albert Hu, professor of economics at the China Europe International Business School in Shanghai, warned they would only be able to do so if growth in other industries creates enough jobs and income growth to compensate for any market exits triggered by price wars.
"Deflation is a serious issue, Japan has struggled with it for over three decades," said Hu. "A critical factor is wage growth."
REUTERS
The Champs-Elysees, the iconic avenue sweeping through central Paris dotted with cafes and shops, connects the Place de la Concorde in the east with the Arc de Triomphe in the west in a single, breathtakingly straight line.
But one thing seems to be missing amid the tourist throngs - Parisians themselves.
A true Parisian is rare on the avenue, and as one local said, that is not really surprising.
"There's no place for us - no garden, nowhere to sit," Xavier LeBrun, 35, said as he watched tourists stream past on the almost two-kilometer avenue.
It is "where Parisians cross to get from one place to another, and that's it," he said.
A top tourist attraction, locals have gradually abandoned it over concerns that it is too noisy, dirty and expensive, with luxury brands replacing independent shops.
However, that could change if a committee can make its voice heard.
After five years of work the Champs-Elysees Committee, endowed with a budget of five million euros (HK$42.29 million), last week listed 150 proposals, including adding green spaces, reducing pollution, and organizing cultural events.
The starting point for the committee, an association of business and culture representatives, was the "alarming" realization that the world-famous street was "no longer loved, no longer likeable, deserted by Parisians, and feared by foreigners."
A giant open-air picnic held on the avenue late last month was an example of how the committee plans to address the issue.
"It's a way of telling Parisians: come back to the Champs-Elysees," committee chairman Marc-Antoine Jamet said.
With stores and historic cinemas closing due to rising rents and falling sales, "innovation is an absolute necessity," he said.
The plan seeks to reverse the decline while balancing local and tourist needs.
The estimated cost will be 250 million euros, but Jamet said the additional tax revenue generated by the changes would be enough to finance all or some of the project.
A self-proclaimed Paris "superfan" who has visited from Pakistan 22 times, 33-year-old Jawwad Channa said he always visits the avenue, this time bringing along four friends looking forward to hitting the stores.
"It's very crowded, but the shopping is amazing," said his friend Ali Syed, 32.
Shopping will remain a mainstay, but adapting the avenue to global warming and reducing its carbon footprint by a third over 50 years is central, with plans to increase pedestrian space and double bike lanes.
Lowering average temperatures by up to seven degrees Celsius is another objective amid increasingly common heatwaves. Proposals include planting 160 trees, installing seating and fountains, and transforming 20 hectares of unkempt gardens into a "true Parisian park."
Symphony concerts, a "quality" Christmas market and flower stalls are also part of a push for "year-round" cultural offerings to "revamp the neighborhood".
Last month's picnic, at which thousands turned out on the "world's largest tablecloth," came after an event last year when France's bookworms battled it out in a mass spelling test at 1,779 desks.
With the presidential palace and National Assembly nearby, security is a concern, though the proposal includes plans to increase the police presence and establish a 24-hour "health and safety" watch.
For Gabin Contentin, 21, big changes are needed for him and other locals to be lured back, but if all goes well, he predicted, the Champs-Elysees can "once again be the most beautiful avenue in the world."
AGENCE FRANCE-PRESSE |
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| From: Don Green | 6/16/2024 5:24:09 PM | | | | | | Opinion | A Voter Revolt Grows in California
Opinion by WSJ The Editorial Board
We’ve told you about California Gov. Gavin Newsom’s lawsuit to block a citizen initiative from this November’s ballot that would make it harder to raise taxes. Now his Legislature is trying to sabotage another initiative that would toughen penalties for theft and drug crimes. Why do Democrats fear voters?
Law enforcement, businesses and local elected officials across the Golden State are campaigning to roll back parts of Prop. 47. That’s the 2014 initiative that made misdemeanors of drug possession and theft of less than $950 in goods. Supporters including Mr. Newsom said it would save money by reducing incarceration.
The George Soros-backed initiative cut the state prison count, but Californians are paying a high price. Organized criminals exploit the law’s lax penalties. District attorneys say Prop. 47 prevents them from leveraging the penalty of jail time to induce addicts into treatment. Police often don’t arrest thieves or drug users because the crimes go unpunished. Retail theft, vagrancy and open-air drug use have spiked.
Thus the citizen initiative, which would toughen penalties for shoplifters and drug dealers. Someone with two prior convictions for theft could be charged with a felony on the third offense no matter the amount. The value of stolen property from multiple thefts could be combined for a felony charge.
The initiative would also make possessing fentanyl while carrying a loaded firearm a felony. Dealers could be charged with homicide if their clients overdose. Prosecutors would have the discretion to charge drug possession as a felony after two prior drug convictions. To avoid jail and expunge the charge, drug users could get treatment and would receive shelter and job training.
California’s secretary of state last week announced the initiative had received enough signatures to qualify for the November ballot. But legislative leaders are now plotting to kill the initiative with political misdirection. Democrats are advancing a package of bills to assuage public anger about surging crime. One would let courts issue restraining orders against thieves, as if this would stop them. Another would toughen penalties for organized criminals who steal more than $50,000 in goods.
Some of the legislation would help at the margin, though it would do little to help drug addicts or crack down on shoplifters not part of crime syndicates. The Democratic goal is to appear as if they are doing something about crime without enacting substantive reforms.
Yet in a bizarre twist, Democrats last week threatened to blow up their own legislation by inserting language in the bills that would render them void if voters pass the Prop. 47 reform. Why would they do this? Because they plan to tell voters that the initiative would nullify the Legislature’s “smarter” anti-crime measures. Imagine how much better managed the state would be if Democrats put half as much thought into fixing problems as they do into conning voters.
***Separately, the state Supreme Court last month heard arguments in Mr. Newsom’s lawsuit to remove the Taxpayer Protection and Government Accountability Act from the November ballot. The initiative would require a majority of voters to approve taxes adopted by the Legislature. Both the Legislature and voters would have to approve regulatory action that increases state revenue. Charges for specific government services or products like fishing licenses would have to reflect the actual cost of providing the service or product. The initiative would also raise the threshold for localities to pass all special taxes to two-thirds.
Democrats say the initiative would harm essential services and the ability to respond to emergencies—by which they mean budget shortfalls caused by excessive spending. California faces a $45 billion deficit while many localities bleed red ink owing to ballooning pension payments.
Mr. Newsom last month pledged not to raise taxes, but his regulators are advancing a refinery tax and tightening climate mandates to increase revenue. The initiative would forbid this. Democrats sued to block it because they are scared of a voter revolt a la Prop. 13 in 1978, which capped property taxes and required a legislative super-majority to raise taxes.
A new Public Policy Institute of California survey shows that 71% of likely voters say they pay more in taxes than they should. That’s by far the largest share in the 21 years that the question has been asked. A record 56% also said they’d prefer to pay lower taxes and have fewer services. Disapproval of Mr. Newsom also hit a new high.
Californians are fed up with the state’s high taxes, which has bought them nothing but government dysfunction. Instead of trying to dupe and disenfranchise voters, how about listening to them?
Opinion | A Voter Revolt Grows in California © Jessica Christian/Associated Press |
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| From: Les H | 6/17/2024 2:12:56 PM | | | | | | Secret Democrat plot to replace Biden revealed: How Clinton, Obama, Pelosi and Schumer will topple the aging President… and when they'll do it
dailymail.co.uk
The only people who could force him out would be Barack Obama, Bill Clinton, Nancy Pelosi and Chuck Schumer,' one Democratic strategist told the Mail. 'It would have to be the four of them collectively.' |
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| To: Les H who wrote (42541) | 6/17/2024 11:15:27 PM | | From: Les H | | | | |
1995 reverse Paris Accord where Japan, Germany buy US treasuries while Fed keeps short-term interest rates down to spur domestic consumption and imports, partly in response to Mexican NAFTA crash and Japan's weak economy after the Kobe earthquake. |
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| To: Les H who wrote (42542) | 6/18/2024 9:55:32 AM | | From: Les H | | | | Ukraine plans to invite Russia to second 'peace summit to 'end the war': Kuleba
No sooner had the first so-called “peace summit” in Switzerland ended than Ukraine had already planned a second one, with the participation of Russia. This was stated by Ukrainian Foreign Minister Dmitry Kuleba, Top War reports.
The first conference in Switzerland, organized by Kiev, was called a “failure.” As some Western experts note, Zelensky failed to win over the countries of the global South, after which the significance of the summit sharply decreased. In essence, it was a Western get-together where the problems of Ukraine were discussed, and not the end of the conflict. Now Kyiv wants to convene a second conference and invite Russia there to try to push Zelensky’s “peace formula” in.
"The idea is that the next summit will be the end of the war. And, of course, we need the other side at the negotiating table. It's obvious that it takes both sides to end the war," Kuleba said, adding that Ukraine’s position coincides with the position of the West and does not provide for the compromises that Kyiv called on the countries of the global South.
At the same time, Switzerland has not ruled out that a new “peace summit” will be held before November of this year, since then the presidential elections in the United States will begin and everyone will have no time for Zelensky. This was stated by Swiss Foreign Minister Ignazio Cassis, adding that he sees no problems with Vladimir Putin’s participation in the conference, despite the order of the International Criminal Court (ICC).
Meanwhile, many experts doubt that Russia will go to Switzerland, since this country is no longer neutral. Most likely, one of the Middle East countries will be chosen for a possible conference on Ukraine. In addition, Moscow has already outlined its conditions and does not intend to deviate from them.
1lurer.am
Sounds like Biden needs a "peace" summit before the election. |
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| To: Les H who wrote (42543) | 6/18/2024 10:08:17 AM | | From: Les H | | | | Putin Preempts Pointless 'Peace' Powwow
SIMPLICIUS
JUN 18, 2024
simplicius76.substack.com
The decision to strike deeper into Russia and force their ground forces to extend further into Western Ukraine isn't going according to plan. Russia realizes the trap of getting involved in a situation with urban warfare spread over a large area with a hostile civilian population. Much of its infrastructure will be damaged instead. |
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