reality is only those delusions that we have in common...

Saturday, July 4, 2020

week ending July 4

Fed Opens Lending Program for New Issuance of Corporate Debt - The Federal Reserve formally opened Monday its $500 billion lending program to support issuance of new debt by large corporations, the last of nine emergency programs it is running to backstop lending markets reeling from the coronavirus pandemic. The Fed began purchasing earlier this month individual bonds of large companies that were highly rated as of March 22, but it hadn’t yet said when it would initiate a companion effort to purchase newly issued securities by those companies.  The Fed is offering two ways for companies to participate in the program. The central bank will purchase eligible syndicated loans and bonds alongside other investors, and it will also buy eligible bonds as the sole investor. For the latter option, the Fed said Monday that prices for those bonds would be subject to minimum and maximum spreads over yields on government bonds of comparable maturities. Those caps and floors “will vary based on an eligible issuer’s credit rating” as of the day on which the Fed purchases the bonds, the Fed said in a revised term sheet published Monday. The Fed program is open to companies that were rated investment-grade as of March 22 but that were subsequently downgraded by one notch afterward. Companies must certify that they have significant operations and a majority of their workforce in the U.S. The program isn’t open to banks, bank holding companies or their subsidiaries, as well as companies that have received specific support from federal legislation to provide relief from the pandemic. Separately, the Fed on Sunday identified 794 companies whose bonds it is purchasing to directly support corporate-bond markets. The largest beneficiaries include Apple Inc.,Verizon Com munications Inc., AT&T Inc. and U.S. units of Toyota Motor Corp., Volkswagen AG and Daimler AG . In all, the central bank accumulated $8.7 billion in corporate debt or exchange-traded funds that invest in corporate debt through June 24. It began purchasing individual bonds, as opposed to ETFs, on June 16, and it purchased around $200 million bonds a day over the first two days of that initiative. The announcements of the lending programs—on March 23, when the Fed said it would buy investment-grade debt, and on April 9, when it said it would include debt of so-called fallen angels that had been downgraded from investment grade after March 22—helped sharply reduce borrowing costs for an array of businesses.

Fed Launches Corporate Bond Buying Program, Gobbling Up Fossil Fuels and Tobacco Bonds --Pam Martens - Taxpayers’ money under the CARES Act is going up in smoke — literally.As of today, there are more than 32,000 people in the United States hospitalized with COVID-19, with thousands struggling to breathe from a virus that attacks the respiratory system as well as other parts of the body. So what has the Federal Reserve decided to do to help out during this national health crisis? It’s propping up the prices of the bonds issued by fossil fuel corporations and Big Tobacco – two serial polluters of the air we breathe.The Fed decided to release its first list of individual corporate bond purchases in its Secondary Market Corporate Credit Facility today – on Sunday – when folks are out taking a walk with face masks in an effort to avoid dangerous particles in the air. The same Fed facility, which is using $25 billion of the $454 billion of taxpayer money provided as part of the CARES Act to absorb any losses on the Fed’s bailout facilities, previously reported its purchases of junk bonds and investment grade bonds packaged as Exchange Traded Funds (ETFs). Pulling back the curtain on that news was equally stomach churning. One of the corporations whose bonds are being bought by the Fed is Philip Morris International. The company says on its website that it manufactures “six of the top 15 international brands” of cigarettes in the world. Its brands include: Marlboro, Parliament, Virginia Slims, Chesterfield, L&M, Lark, Merit, Muratti, Philip Morris, Bond Street, Next, and Red & White. The Federal Reserve, the sage central bank of the United States, spent $6.23 million buying the bonds of Philip Morris International in this initial round of purchases.Fossil fuel bonds bucked up by the Fed’s purchases include those of Exxon Mobil; Chevron; Duke Energy; Phillips 66; and Marathon Petroleum. The Fed’s summary sheet said it had spent $17.5 million on energy-related corporate bonds during this first round of purchases. The Fed has announced that it plans to spend a total of $750 billion by September 30 buying up corporate bonds in both the primary and secondary markets. It is buying both investment grade and junk bonds, provided that the bonds had an investment grade rating as of March 22. Through June 16, the Fed said its secondary market corporate bond purchases thus far were rated as follows: 48.07 percent A to AAA; 48.31 percent BBB (which is the lowest level before junk); and 3.62 percent rated BB.

Automakers, Technology Firms Are Largest Components of Fed’s Corporate-Bond Purchases – WSJ - Apple, Verizon, and the U.S. divisions of several foreign auto makers are among the largest direct beneficiaries of Federal Reserve efforts to support the corporate-debt market, according to disclosures Sunday. In all, the Fed on Sunday identified 794 companies whose bonds it will be buying directly to support the market for investment-grade corporate debt. In addition to Apple and Verizon, the recipients include AT&T Inc. and the U.S. units of Toyota Motor Corp., TM 0.58% Volkswagen AG VOW 1.05% and Daimler AG DMLRY 3.50% . Together those six companies accounted for 10% of debt purchased from a broad list of borrowers the Fed is supporting. The list includes debt from across 12 different sectors. Two of those—consumer cyclical and consumer noncyclical industries—account for more than one-third of corporate bonds the central bank planned to purchase, according to the latest disclosures. The Fed announced in March that it would buy corporate debt to prevent the market from freezing up and squeezing companies of needed cash as the economy ground to a halt from the coronavirus shock to the nation. The central bank’s corporate-debt program is structured in different phases. The Fed plans to purchase up to $250 billion of debt already issued by companies. Later it plans to purchase up to $500 billion in newly issued bonds. As part of its purchases of outstanding debt, the Fed in mid-May started buying exchange-traded funds that hold investment-grade and junk bonds. In another phase of those purchases, the Fed this month started buying actual corporate bonds, and not just ETFs. The latest central-bank disclosures for the first time included the actual bonds it started buying this month. In all, the central bank accumulated $8.7 billion in corporate debt through June 24. The program runs through Sept. 30. The Fed’s support has led to a boom of debt issuance by U.S. companies. The Fed is tapping into a $9.6 trillion corporate-debt market from companies that satisfy the Fed lending program’s criteria, including companies that were investment-grade-rated as of March 22 and had maturities no longer than five years in duration. The Fed will recalculate the list of its potential purchases every four or five weeks to add companies that meet the eligibility requirements and to remove those that no longer qualify. The latest disclosures showed $398 million in securities purchased as of June 17, the first two days of individual bond purchases. Those include bonds issued by drugmaker AbbVie Inc., media company Comcast Corp., beverage giant Coca-Cola and UnitedHealth Group Inc., parent of the nation’s largest health insurer. Some critics have questioned whether the Fed should be buying bonds in the secondary market at all since borrowing is now so cheap.

The Fed Is Now A Top 5 Holder Of The Biggest Corporate Bond ETFs - For much of the past decade, the Bank of Japan - which owns about 80% of all ETFs in Japan... ... was the butt of capital markets jokes, or rather jokes involving central planning, of which the Japanese central bank had become the "new normal" poster child. Alas, the joke is now on the US, where Jerome Powell is now boldly going where Haru Kuroda has gone so many times before, and bought anything that is not nailed down. Of course, for now the Fed is "only" buying corporate bond ETFs (while waiting for the next crash before buying stock ETFs), but even here its footprint is already massive. While the Fed's own disclosure of which ETFs it owns is minimal on its own H.4.1 weekly filing, Bloomberg has been kind enough to compile the Fed's bond ETF holdings. What it has found is the following: the Fed now owns $6.8 billion market value in corporate bond ETF, of which LQD, VCSH, VCIT, and IGSB are the top holdings. In total, the Fed now has a stake in no less than 16 ETFs (that Bloomberg is aware of). What is more striking, however, is that drilling into these holdings reveals that as of this moment, the Fed is a Top 5 holder in some of the biggest bond ETFs, including the biggest Investment Grade ETF, the LQD, where the Fed is now the 3rd laragest holder... ... the VCSH, the Vanguard Short-Term Bond ETFs, where the Fed is the 2nd biggest holder... ... the VCIT, the Vanguard Intermediate-Term Corporate Bond ETF, where the Fed is the 5th biggest holder... ... but it's not just investment grade ETFs: indeed, as of this moment, the Fed is also the 5th biggest holder of the JNK junk bond ETF... ... and is the 21st biggest holder of the other junk bond ETF, the HYG. Don't worry it won't be there for long. The good news: while the Fed has now effectively taken over the corporate bond market, it still has to buy equity ETFs. The bad news: we are just one 20% drop in the S&P away from the Federal Reserve taking over all asset prices markets and ending all markets and price discovery... at least until the Fed is finally destroyed.

The Good, the Bad, and the Ugly About the Fed’s New Credit Allocation Policy -  The Federal Reserve System continued to operate about a dozen ad hoc credit facilities, most of which are newly authorized by the CARES Act of 2020.Figure 1 names and Figure 2 plots activity levels, week by week, in eight of the Fed’s operative programs as they have come on line. Who is eligible for these programs and on what terms remains a fluid issue. Still, the stock market seems pleased not only with the programs, but with how the Fed has broadened access to these programs on the fly.In the face of the unprecedented surge in unemployment shown in Figure 3, Federal Reserve officials have earned points for stepping forward as perhaps the government’s premier and most agile economic firefighters. Using their limited policy toolkit, they have enhanced the flow of credit and liquidity to some of the markets and borrowers that figured to be greatly impacted by the unfolding economic catastrophe. And they did this at a time when Congress and the Executive branches of the federal government took a few weeks to figure out how to channel taxpayer subsidies to lucky firms through the Treasury and the Fed. But no matter how well-intended ad hoc credit programs may seem at their start, history tells us that efforts at government credit allocation tend to unravel as time goes on. Although one could cite example after example of this deterioration, it should be enough to point to the repeated hash that has been made of programs aimed at subsidizing homeownership. The successive failure of housing-finance programs is rooted in the incentive conflicts that develop on both sides of any subsidy scheme. On the supply side, it becomes more and more difficult to monitor and restrain the ways in which agency personnel respond to industry and Congressional pressure to expand subsidies. On the demand side, participants learn to exploit two ways to increase their access to subsidies. First, they learn how and how far they can influence individual regulators on different issues. Second, they learn ways to make sure that the benefits that captured regulators and legislators deliver far exceed the costs of building and exercising the necessary clout. The steady rollback of Dodd-Frank reforms over the last decade vividly illustrates the workings of this inch-by-inch process.

Fed Looks Down Under for Rate Strategy – WSJ —With the Fed considering a new monetary policy tool to help hold interest rates low amid the severe downturn, clues to the tactic’s effectiveness can be found in one advanced economy far away. The Fed is eyeing Australia’s experience with so-called yield caps, in which a central bank buys enough government securities to prevent their yields from rising above a certain level or to pin yields at specific levels. This helps to hold down private-sector interest rates, which are influenced by government debt yields. While it is too soon for a final verdict, the approach appears to be working well so far, though not without some potential costs and risks. Since March, the Reserve Bank of Australia has set a target of 0.25% for the yield on the government’s three-year bond. The yield declined to around that level within days of launching the policy and has stabilized in a tight range near that point. Economists say there is a lot to like about Australia’s experience. To start, the RBA has anchored the three-year yield without having to expand its balance sheet massively. The central bank quickly bought $35 billion in bonds to cement the policy in place, but has spent the past month on the sidelines. The yield cap, importantly, also helps reinforce the RBA’s outlook for rates and the economy. RBA Governor Philip Lowe has said the central bank won’t raise its policy rate from 0.25% until it makes progress toward full employment and it is confident inflation will remain within its 2%-to-3% target band. Together, this verbal commitment and the yield cap should prevent investors from anticipating central bank rate increases too soon and pushing up interest rates set by markets. The introduction of the yield cap has proven “simple to implement and communicate, and potentially efficient from a balance sheet perspective,” wrote Andrew Boak and Daan Struyven of Goldman Sachs & Co. LLC. Another benefit of the RBA policy is that it directly helps lower the cost of funding mortgages. “The RBA gets a large bang for the buck, so to speak,” . “Yield-curve control may be a way for the Fed to achieve the same in terms of keeping bond yields low, and hence the cost of funding down in the U.S., but at the same time be buying less bonds than is currently the case.”

FOMC Minutes: Pandemic "Posed considerable downside risks to the economic outlook over the medium term" -From the Fed: Minutes of the Federal Open Market Committee June 9-10, 2020. A few excerpts: Over the intermeeting period, risk sentiment improved, on net, as optimism over reopening the economy, potential coronavirus treatments, the unexpectedly positive May employment situation report, and other indicators that suggest that economic activity may be rebounding more than offset concerns arising from otherwise dire economic data releases, warnings from health experts that openings may have been premature, and renewed tensions between the United States and China.  Participants noted that the coronavirus outbreak was causing tremendous human and economic hardship across the United States and around the world. The virus and the measures taken to protect public health induced sharp declines in economic activity and a surge in job losses. Weaker demand and significantly lower oil prices were holding down consumer price inflation.  In their discussion of monetary policy for this meeting, members agreed that the coronavirus outbreak was causing tremendous human and economic hardship across the United States and around the world. The virus and the measures taken to protect public health had induced sharp declines in economic activity and a surge in job losses. Consumer price inflation was being held down by weaker demand and significantly lower oil prices. Financial conditions had improved, in part reflecting policy measures to support the economy and the flow of credit to U.S. households, businesses, and communities. Members agreed that the Federal Reserve was committed to using its full range of tools to support the U.S. economy in this challenging time, thereby promoting its maximum-employment and price-stability goals.  Members further concurred that the ongoing public health crisis would weigh heavily on economic activity, employment, and inflation in the near term and posed considerable downside risks to the economic outlook over the medium term. In light of these developments, members decided to maintain the target range for the federal funds rate at 0 to 1/4 percent. Members noted that they expected to maintain this target range until they were confident that the economy had weathered recent events and was on track to achieve the Committee's maximum-employment and price-stability goals.

FOMC Minutes Suggest Fed Will Keep Buying Bonds "For Many Years", Shuns Yield Curve Control - As expected The Fed's Minutes show that officials reviewed other options to provide more support for the economy but Fed officials did agree there was no more need to analyze yield curve control (mentioned 15 times in the minutes).A number of participants commented on additional challenges associated with YCT policies focused on the longer portion of the yield curve, including how these policies might interact with large-scale asset purchase programs and the extent of additional accommodation they would provide in the current environment of very low interest rates.In their discussion of the foreign and historical  experience with YCT policies and the potential role for such policies in the United States, nearly all participants indicated that they had many questions regarding the costs and benefits of such an approach."some participants said [YCT could result] in the central bank inadvertently setting yield caps or targets at inappropriate levels. "This is important as consensus expected some form of YCT policy adjustment in September.Instead, Fed officials preferred to focus on inflation-based forward guidance:“That could possibly entail a modest temporary overshooting of the Committee’s longer-run inflation goal but where inflation fluctuations would be centered on 2 percent over time.“They saw this form of forward guidance as helping reinforce the credibility of the Committee’s symmetric 2 percent inflation objective and potentially preventing a premature withdrawal of monetary policy accommodation.”On how long they will remain easy... "The staff presented results from model simulations that suggested that forward guidance and large-scale asset purchases can help support the labor market recovery and the return of inflation to the Committee’s symmetric 2 percent inflation goal.The simulations suggested that the Committee would have to maintain highly accommodative financial conditions for many years to quicken meaningfully the recovery from the current severe downturn.”

Banks 'not getting a ton of interest' in Main Street program- Powell — Federal Reserve Chairman Jerome Powell said Main Street Lending Program loans are not in high demand, but he reiterated the central bank’s commitment to continue making adjustments that could attract more borrowers. The program, aimed at helping small and midsize businesses stay afloat during the coronavirus pandemic, is making loans available through third-party banks to companies with up to 15,000 employees or up to $5 billion in annual revenue. Banks have been able to register as eligible lenders since June 15 with the Federal Reserve Bank of Boston, which is administering the program. Once that registration process is complete, banks can begin making Main Street loans under the appropriate terms. Powell told the House Financial Services Committee Tuesday that about 300 banks have registered as lenders so far, and that the Fed has had “a lot of interest” from lenders looking to participate. But banks aren’t reporting an influx of demand from potential borrowers, he said. “What the banks tell us is that it’s sort of a mixed thing,” Powell said. “They’re not getting a ton of interest from borrowers, and many say they expect that to change over the course of the next few months.” The $600 billion Main Street Lending Program — which was established using funding appropriated to the Treasury Department from the coronavirus relief package — has been met with criticism from some who feel that the minimum loan of $250,000 is simply too high to work for many smaller businesses, and that the calculations that determine the appropriate loan amount would disqualify some companies. “For many nonprofits and small businesses, earnings before interest, taxes, depreciation and amortization is not widely used metric,” said Rep. Lacy Clay, D-Mo. Powell said that while EBITDA is a “widely used” metric, there are many other metrics that the Fed is considering along with Treasury. “One of them — probably the next one in line — is something along the lines of asset-based and that’s something we’re looking at with the Treasury.” Treasury Secretary Steven Mnuchin also testified alongside Powell Tuesday in a hearing to examine the execution of coronavirus relief. But Powell said the Fed has not yet considered eliminating the minimum loan amount of $250,000. “We can, once we get up and running, look at lowering it again, but you get into a very different kind of lending when you’re down lower, and these are really personal loans rather than business loans,” he said. “We could look at that, but that would be something we’d look at once we get up and running.”

Fed’s Daly Calls Economic Outlook ‘Uncertain’ – WSJ - Federal Reserve Bank of San Francisco leader Mary Daly declined to say Monday whether an uptick in coronavirus-related illness in parts of the country is on track to damage her expectations of a slow and gradual recovery. “I’m afraid it’s very uncertain” what lies ahead for the economy right now, Ms. Daly told reporters on a conference call. The central banker, who didn’t make any comments on her outlook for monetary policy, said she is taking in as much information as she can and listening to public health experts. But at the same time, even as illness levels spike, in a climate where some of her colleagues have warned some areas might be moving too swiftly to reopen their respective economies, Ms. Daly said she isn’t ready to say something is going wrong. When it comes to the economy and the data that describes it, “the right characterization of what I feel right now is curious,” she said. “It is far too early to tell” what is happening with the economy, said Ms. Daly, who added “there’s just no information yet.” But the Fed official did say that the uneven experience some regions are facing as they try to reopen is “consistent with the slow and gradual recovery that I have penciled in my outlook.” She added, “we’re not out of the woods in terms of the economic impact” of the coronavirus pandemic “until we get a widespread, strong mitigation strategy for the virus, or we get a vaccine.”

US Fed official warns of potential for a financial crisis - A leading member of the US Federal Reserve Board has warned that the financial crisis that threatened to erupt in mid-March—when markets in all assets essentially froze—could return unless the COVID-19 pandemic is brought under control. In an interview, the president of the Federal Bank of St Louis, James Bullard, told the Financial Times yesterday that the United States was still “in the middle of a crisis.” “Even though we got past the initial wave of the March-April timeframe, the disease is still capable of surprising us,” he said. “Without more granular risk management on the part of health policy, we could get a wave of substantial bankruptcies and [that] could feed into a financial crisis.” Bullard insisted the Fed’s policy of providing trillions of dollars to financial markets, now extended to the purchase of corporate debt, including so-called junk bonds, had to continue. That was because there were “twist and turns” in a crisis and “there can be another shoe to drop, and it could happen here.” While the purchase of corporate bonds, both directly and through Exchanged Traded Funds, was “controversial,” the central bank’s measures had to be kept in place, as the corporate debt market had been “sorely tested” in March. “With all these programs the idea is to make sure the markets don’t freeze up entirely, because that’s what gets you into a financial crisis, when traders won’t trade the asset at any price.” The Fed’s justification for its extraordinary measures, which go far beyond what it did in response to the financial meltdown of 2008, is that they are necessary to sustain the economy. Their real purpose, however, is to finance the accelerated siphoning of wealth into the coffers of Wall Street. As the result of the Fed’s decision to act as the backstop of all areas of the financial system, the market capitalisation of the US stock exchanges has increased by more than $7 trillion since the freeze in mid-March. Between the mid-March and mid-June, the net worth of the more than 640 US billionaires rose from $2.948 trillion to $3.531 trillion. The combined wealth of the five richest men in America—Jeff Bezos, Bill Gates, Mark Zuckerberg, Warren Buffett and Larry Ellison—grew by $101.7 billion, or 26 percent. Having boosted the wealth of the financial oligarchy, in the midst of economic devastation for vast swathes of working people, the Fed is actively considering giving the rich even more support, as revealed in the minutes of its June meeting published on Wednesday. According to the minutes, officials expressed a “great deal of uncertainty” about whether a safe reopening of the economy could be achieved. They maintained that whatever eventuated, “highly accommodative monetary policy and sustained support from fiscal policy” would be needed.

Forget The V, W, Or L Recovery- Focus On N-P-B - The fantasy of a V-shaped recovery has evaporated, and expectations for a W or L-shaped recovery are increasingly untenable. So forget V, W and L; the letters that will shape the future are N, P, B: there is No Plan B.  All the hopes for a recovery were based on a quick return to the economy that existed in late 2019. All the bailouts and stimulus programs were based on this single goal: a quick return to The Old Normal. This was Plan A.For all the reasons that have been laid out here over the past six months, The Old Normal is gone for good. The Old Normal economy was too precarious, too brittle and too fragile to survive the toppling of any domino, as the only Plan A "solution" was to push destabilizing extremes to new extremes, i.e. doing more of what failed spectacularly and increasing the fragility of precariously fragile systems.A short list of what's been irreversibly destabilized due to a systemic collapse in demand, exponential rise in risk and uncertainty, dependence on over-indebtedness, imploding global supply chains, structural decline in income and employment and the rapid emergence of new business models that obsolete high-cost, inefficient, sclerotic, bureaucratic monopolies include:

  • 1. Healthcare
  • 2. Higher education
  • 3. Commercial real estate
  • 4. Tourism
  • 5. Restaurants / live entertainment
  • 6. Business travel / conferences
  • 7. Office parks, commutes, urban work forces, etc.
  • 8. High-cost urban lifestyles

We could also include entire sectors that have yet to recognize the tsunami that's about to wash away their Old Normal: marketing, finance, local governance, etc.  The problem is there's no Plan B for anything in the U.S. economy. There is only Plan A, a return to 2019 / The Old Normal. If that's no longer possible, there is literally nothing left on the policy / response plate.What nobody dares even ask is: what businesses and industries will still be financially viable running at 50% capacity? How many cafes, restaurants, resorts, airlines, etc. will turn a profit operating at 50% capacity? How many can not just survive half of the seats being empty, but turn a profit?The short answer is very few, because the operating  costs of most businesses are unbearably high. The likely survivors are those enterprises with low fixed costs and low operating costs-- enterprises that own their facilities in locales with low property taxes, and enterprises that can be run by the owners without employees.

CBO Sees Double-Digit Jobless Rate Through 2020, GDP to Shrink 5.9% —Unemployment is likely to remain in double digits through year’s end, and the economic downturn will be more severe than previously forecast, according to projections released Thursday by the Congressional Budget Office. The CBO estimates the jobless rate will end the year at 10.5%, lower than its earlier forecast of 11.5%. Nevertheless, it is likely to remain above the pre-coronavirus pandemic level of about 3.5% through the end of the decade. The Labor Department on Thursday reported the rate fell to 11.1% in June from 13.3% in May. Gross domestic product, the broadest measure of economic output, is expected to grow rapidly in the second half of 2020 as social-distancing measures are lifted and trillions of dollars in stimulus spending takes effect. But that won’t be enough to overcome the impact of widespread business closures earlier in the year. Output in the fourth quarter of 2020 will be 5.9% lower than a year earlier, the agency said, worse than the 5.6% drop it projected in May. Though the economy is likely to grow 4.8% next year, it won’t return to its pre-pandemic size until mid-2022, it said. The bounceback will likely be followed by a long, slow recovery similar to the pace of the previous decadelong economic expansion, when growth averaged around 2% a year, the CBO said. Unemployment is expected to average 6.1 percent a year through 2030. The agency said its forecasts assume that social-distancing measures “gradually diminish to zero” from the third quarter of this year through the third quarter of 2021. But it acknowledged that projections are highly uncertain, given incomplete knowledge about the severity of the pandemic and the prospects for developing treatments or a vaccine. The U.S. economy was humming in February when the coronavirus pandemic triggered widespread business closures and travel restrictions designed to stem the outbreak, bringing economic activity to a standstill and ending the longest expansion in U.S. history. “The economic outlook for 2020 to 2030 has deteriorated significantly since the agency last published its full baseline economic projections in January,” CBO director Phillip Swagel said in Thursday’s report.

Spiking coronavirus cases threaten fragile recovery - The surging coronavirus is threatening to derail a budding recovery from the pandemic-driven recession. COVID-19 cases are skyrocketing in states across the South and the Sun Belt, where governors who took some of the most ambitious steps to reopen their economies are now in retreat, scrambling to curb new outbreaks. Those setbacks come less than a month after economic data almost across the board showed promising signs that a recovery was taking hold. Job gains and consumer spending in May boosted hopes of steady, if grueling, recovery. But with the hardest-hit states now taking lockdown steps reminiscent of March and April, economists warn the road to recovery may get a lot more painful, with some regions weighing down the rest of the country’s economic prospects. That scenario would also deal a significant blow to President Trump, whose reelection campaign focuses heavily on the economy. “Renewed restrictions in some cities, counties, and states already are underway, and more will follow,” wrote Ian Shepherdson, founder and chief economist of research consultancy Pantheon Macroeconomics, in a Friday research note. “With fear of the disease keeping people home, the recovery [in] the South — which is already faltering — could easily go into reverse,” he added. After months of progress slowing the spread of COVID-19, the U.S. in the past week has consistently broken daily records for new cases. Thursday saw a record of 40,401 new cases reported, according to Johns Hopkins University, shattering the previous mark set in April by more than 3,000. Trump and other administration officials have downplayed the surge, instead calling it a sign of greater testing capacity. A resurgence in cases could be ruinous for businesses and employees who barely survived the first lockdown orders. Roughly 15 million laid-off workers told the Labor Department in May that they expected to return to their pre-pandemic jobs, but another round of lockdowns may prevent that from happening. “What happens after the Northeast reopens depends on whether the southern Covid wave is brought under control. If it isn’t, renewed weakness in the South and West, accounting for more than 35% of the economy, will be a drag on the national economic activity numbers until there’s a vaccine,” Shepherdson wrote.Economists have also warned that fear of the virus itself will prevent the U.S from a full recovery even if state and local governments lift all restrictions.

National mask mandate would avert 5 percent GDP loss: Goldman Sachs - A federal mandate to wear masks would slow the spread of the coronavirus enough to save the economy from losing 5 percent of its value, according to a Goldman Sachs study. "We argue that a national face mask mandate could partially substitute for renewed lockdowns," Goldman Sachs analysts Jann Hatzius, Daan Struyven and Isabella Rosenberg wrote in their study. The analysis rested on several steps, finding that mask requirements led to an increase in mask usage that in turn led to better outcomes on COVID-19 spread. Those better outcomes paved the way for more sustained economic reopening. Mask-wearing has become politicized in the United States. President Trump refuses to wear one in public and has said that it's a personal choice. At the Capitol, Democrats have pushed measures to ensure more stringent adherence to mask-wearing. Presumptive Democratic presidential nominee Joe Biden said he favored a national mask mandate. Some members of the GOP have come around more recently, including Vice President Pence, who wore a mask at a recent choral event, and House Republican Conference Chairwoman Liz Cheney (Wyo.), who Tweeted a photo of her father, former Vice President Dick Cheney, sporting a mask. The Goldman Sachs study found that states such as Florida and Texas, which don't have mask mandates, could see a 25-point increase in mask usage if the federal government imposed a mask requirement, and the average level of usage could rise by 15 points across the board. It then looked at the effects of mask on health outcomes and found that mask mandates cut the growth rate of the virus significantly. "Our numerical estimates are that cumulative cases grow 17.3% per week without a mask mandate but only 7.3% with a mask mandate, and that cumulative fatalities grow 29% per week without a mask mandate but only 16% with a mask mandate," the study found

Coronavirus Brings American Decline Out in the Open -  The U.S.’s decline started with little things that people got used to. Americans drove past empty construction sites and didn’t even think about why the workers weren’t working, then wondered why roads and buildings took so long to finish. They got used to avoiding hospitals because of the unpredictable and enormous bills they’d receive. They paid 6% real-estate commissions, never realizing that Australians were paying 2%. They grumbled about high taxes and high health-insurance premiums and potholed roads, but rarely imagined what it would be like to live in a system that worked better. When writers speak of American decline, they’re usually talking about international power -- the rise of China and the waning of U.S. hegemony and moral authority. To most Americans, those are distant and abstract things that have little or no impact on their daily lives. But the decline in the general effectiveness of U.S. institutions will impose increasing costs and burdens on Americans. And if it eventually leads to a general loss of investor confidence in the country, the damage could be much greater. The most immediate cost of U.S. decline -- and the most vivid demonstration -- comes from the country’s disastrous response to the coronavirus pandemic. Leadership failures were pervasive and catastrophic at every level -- the president, agencies such as the Centers for Disease Control and the Food and Drug Administration, and state and local leaders all fumbled the response to the greatest health threat in a century. As a result, the U.S. is suffering a horrific surge of infections in states such as Arizona, Texas and Florida while states that were battered early on are still struggling. Countries such as Italy that are legendary for government dysfunction and were hit hard by the virus have crushed the curve of infection, while the U.S. just set a daily record for case growth and shows no sign of slowing down. This utter failure to suppress a disease that most other countries managed to contain will have real economic costs for Americans, as fear of the virus drives people back into their homes and businesses suffer. But the consequences of U.S. decline will far outlast coronavirus. With its high housing costs, poor infrastructure and transit, endemic gun violence,police brutality and bitter political and racial divisions, the U.S. will be a less appealing place for high-skilled workers to live. That means companies will find other countries in Europe, Asia and elsewhere a more attractive destination for investment, robbing the U.S. of jobs, depressing wages and draining away the local spending that powers the service economy. That in turn will exacerbate some of the worst trends of U.S. decline -- less tax money means even more urban decay as infrastructure, education and social-welfare programs are forced to make big cuts. Anti-immigrationpolicies will throw away the country’s most important source of skilled labor and weaken a university system already under tremendous pressure from state budget cuts. Almost every systematic economic advantage possessed by the U.S. is under threat. Unless there’s a huge push to turn things around -- to bring back immigrants, sustain research universities, make housing cheaper, lower infrastructure costs, reform the police and restore competence to the civil service -- the result could be decades of stagnating or even declining living standards.

Pentagon Porks Up as Covid-19 Bleeds Economy - In response to the Covid-19 pandemic, Washington has initiated its largest spending binge in history. In the process, you might assume that the unparalleled spread of the disease would have led to a little rethinking when it came to all the trillions of dollars Congress has given the Pentagon in these years that have in no way made us safer from, or prepared us better to respond to, this predictable threat to American national security. As it happens, though, even if the rest of us remain in danger from the coronavirus, Congress has done a remarkably good job of vaccinating the Department of Defense and the weapons makers that rely on it financially.There is, of course, a striking history here. Washington’s reflexive prioritizing of the interests of defense contractors has meant paying remarkably little attention to, and significantly underfunding, public health. Now, Americans are paying the price. With these health and economic crises playing out before our eyes and the government’s response to it so visiblyincompetent and inadequate, you would expect Congress to begin reconsidering its strategic approach to making Americans safer. No such luck, however. Washington continues to operate just as it always has, filling the coffers of the Pentagon as though “national security” were nothing but a matter of war and more war.Month by month, the cost of wasting so much money on weaponry and other military expenses grows higher, as defense contractor salaries continue to be fattened at taxpayer expense, while public health resources are robbed of financial support. Meanwhile, in Congress, both parties generally continue to defend excessive Pentagon budgets in the midst of a Covid-19-caused economic disaster of the first order. Such a business-as-usual approach means that the giant weapons makers will continue to take funds from agencies far better prepared to take the lead in addressing this crisis.There are a number of ways the Pentagon’s budget could be reduced to keep Americans safer and better protected against future pandemics. As the Center for International Policy’s Sustainable Defense Task Force has pointed out, the biggest challenges we now confront, globally speaking — including such pandemics — are not, in fact, military in nature. In truth, hundreds of billions of dollars could be cut with remarkable ease from U.S. military spending and Americans would be far safer.

Another anti-Russian smear from the New York Times - Another weekend, and another sensational and fact-free, front-page report in the New York Times aimed at portraying the Russian government as the focus of all evil in the world. Saturday’s front page of the Times carried an article headlined, “Russians Offered Afghans Bounty to Kill U.S. Troops, Officials Say.” A subordinate headline indicated the secondary target of the latest blast: “Trump Administration Has Spent 3 Months Debating Response.” The article thus has related political purposes: to incite a war fever against Moscow, and to denounce the Trump administration for its supposed reluctance to confront Russia and President Vladimir Putin. The article served to signal the American media as a whole to step up its propaganda to convince the American people to regard Russia as a deadly enemy and to condition them to support war with a country that possesses the second-largest stockpile of nuclear weapons on the planet. Moreover, as Trump’s polls plummet due to his disastrous handling of the COVID-19 pandemic and violent threats against peaceful protesters, a major aim of the media’s renewed anti-Russia campaign is to divert mounting popular opposition in a prowar direction. At this point in a commentary, it would be appropriate to review the factual contentions in the Times article and rebut any distortions. But in this particular example, there is no factual substratum, no matter how dubious, to address. The 1,500-word article, carrying no less than three bylines (Charlie Savage, Eric Schmitt and Michael Schwirtz), does not adduce a single fact to support its claim of Kremlin blood money. Instead, the article reports the opinions of top officials of the US military-intelligence apparatus--unnamed, of course--as though they were facts, beginning with, “American intelligence officials have concluded that a Russian military intelligence unit secretly offered bounties to Taliban-linked militants for killing coalition forces in Afghanistan—including targeting American troops…” This is followed by a paragraph beginning with the inimitable words, “The United States concluded,” in which the CIA official dictating to his Times stenographers is given the authority of all 330 million inhabitants of this country.

All Players In The NYT 'Russian Bounties' In Afghanistan Story Have Slammed It As Fake News - Some are calling it a last ditch attempt to keep Russiagate alive ahead of November. The New York Times on Friday said Russian intelligence officers have been offering Taliban militants cash rewards to kill American and British soldiers. In the past two days the claims by the usual anonymous US intelligence officials have crisscrossed the mainstream media, with more "confirmation" offered by... more anonymous intelligence officials. Of course Russia promptly denied it, but more importantly the White House vehemently rejected the report as "fake news" with the president and his aides saying they've never seen such intelligence crossing the president's desk. Certainly something of this level, which hearkens back to the original 1980's proxy war between Moscow and Washington centered in Afghanistan (where it should be noted roles were reversed: the CIA spent years funding and weaponizing the jihadists, many of which would go on to make up today's Taliban), would have been a top national security priority, something presumably impossible to keep from the commander-in-chief.White House Press Secretary Kayleigh McEnany said Saturday in response to the Times story that neither Trump nor Vice President Mike Pence was ever briefed on such a brazen Russian intelligence plan to hand out bounties. "This does not speak to the merit of the alleged intelligence but to the inaccuracy of The New York Times story erroneously suggesting that President Trump was briefed on this matter," she said. And Trump himself confirmed as much, tweeting Sunday morning: Nobody briefed or told me, @VP Pence, or Chief of Staff @MarkMeadows about the so-called attacks on our troops in Afghanistan by Russians, as reported through an “anonymous source” by the Fake News @nytimes. Everybody is denying it & there have not been many attacks on us.....— Donald J. Trump (@realDonaldTrump) June 28, 2020 And rounding things out the Taliban registered its denial as well, meaning that every major player in the NY Times story has now said the story is nonsense.

Russian bounty intel was included in Trump's daily briefing: reports - Intelligence assessing that Russia had offered bounties to incentivize Taliban-linked militants to kill coalition troops in Afghanistan was included in a written briefing for President Trump, according to multiple reports. CNN first reported Monday, citing an unnamed source, that the intelligence was included in one of Trump’s daily briefings in the spring. The New York Times later reported, citing two unnamed sources, that officials provided a written briefing in late February to Trump about the intelligence assessment. And The Associated Press, citing unnamed sources, reported Monday that top officials in the White House were aware of classified intelligence indicating Russia was offering bounties for the deaths of Americans in early 2019. An official reportedly told CNN the assessment was backed up by “several pieces of information” that supported the view that there was an effort by the Russian intelligence unit, the GRU, to pay bounties to kill U.S. soldiers but added that there was also information that did not corroborate this view. “This was a big deal. When it’s about U.S. troops you go after it 100 percent, with everything you got,” the official said. Trump has denied being briefed on the matter, and CNN reported that he doesn't always read the President's Daily Brief from cover to cover. The official told the news network the information was serious enough for the National Security Council staff to hold a meeting during the spring to discuss “possible response options.” Two officials told the Times the intelligence was included as part of Trump’s daily briefing document in February of 2020. One official told the Times it appeared in a brief in late February, and the other cited Feb. 27, specifically. The officials told the Times a description of the intelligence assessment was seen as solid enough to disseminate more broadly across the intelligence community in a May 4 article in the C.I.A’s World Intelligence Review. Officials told the AP the assessment was included in at least one of Trump’s written daily intelligence briefings as early as spring 2019. The AP reports that then-national security adviser John Bolton also told colleagues he briefed Trump on the intelligence assessment in March 2019. Officials told the AP they did not consider the intelligence assessments in 2019 to be particularly urgent, as Russian meddling in Afghanistan is not new. Officials with knowledge of Bolton’s apparent briefing for the president said it contained no “actionable intelligence,” but the classified assessment of Russian bounties was the sole purpose of the meeting, according to the AP. National security adviser Robert O'Brien said in a statement late Monday that Trump had not been briefed on the intelligence reports, and condemned the leaks.

Trump faces bipartisan calls for answers on Russian-offered bounties - Lawmakers on both sides of the aisle are demanding answers after a flurry of reports revealed the intelligence community concluded months ago that Russia offered bounties to incentivize Taliban-linked militants to kill U.S. and coalition troops in Afghanistan. The uproar includes a chorus of Republicans who are typically reticent to confront President Trump, who has sought to deflect blame and responsibility by arguing he was not briefed on the intelligence that he claims is not credible. But congressional Republicans and Democrats — calling the reported Russian operation “egregious” and “disturbing” — say Trump’s explanations only raise more questions that the administration must answer immediately. “Anything with any hint of credibility that would endanger our service members, much less put a bounty on their lives, to me, should have been briefed immediately to the commander in chief and a plan to deal with that situation,” said Rep. Mac Thornberry (Texas), the top Republican on the House Armed Services Committee, who is retiring from Congress at the end of this term. Thornberry, who added that the bipartisan “insistence to see the intelligence” is “even stronger nonpublicly” than it has been publicly, echoed other military leaders who have expressed incredulousness that such intelligence did not reach the commander in chief. On Monday, the White House briefed at least seven Republicans: Thornberry, House Foreign Affairs Committee ranking member Michael McCaul (Texas), and Reps. Liz Cheney (Wyo.), Andy Biggs (Ariz.), Jim Banks (Ind.), Adam Kinzinger (Ill.) and Elise Stefanik (N.Y.), a source familiar with the meeting said. A group of House Democrats will also be getting a briefing at the White House on Tuesday, House Majority Leader Steny Hoyer (D-Md.) confirmed in a statement Monday evening. House Speaker Nancy Pelosi (D-Calif.) sent a letter Monday to Director of National Intelligence John Ratcliffe and CIA Director Gina Haspel requesting a full House briefing, saying that “Congress and the country need answers now.” Senate Minority Leader Charles Schumer (D-N.Y.) released his own statement, making the same request for the two intelligence leaders to immediately brief senators. Thornberry and House Armed Services Committee Chairman Adam Smith (D-Wash.) have also demanded a briefing from the Pentagon for their full committee this week, but Thornberry and a Democratic committee spokesperson said they have not received a response from the Defense Department. “If the reports are true, that the administration knew about this Russian operation and did nothing, they have broken the trust of those who serve and the commitment to their families to ensure their loved one’s safety,” Smith said in a statement Monday. “It is imperative that the House Armed Services Committee receive detailed answers from the Department of Defense.”

NSA Differed From CIA, Others on Russia Bounty Intelligence – WSJ —The National Security Agency strongly dissented from other intelligence agencies’ assessment that Russia paid bounties for the killing of U.S. soldiers in Afghanistan, according to people familiar with the matter.The disclosure of the dissent by the NSA, which specializes in electronic eavesdropping, comes as the White House has played down the revelations, saying that the information wasn’t verified and that intelligence officials didn’t agree on it.Because of that, President Trump was never personally briefed on the threat, the White House said, although the information was included in written intelligence materials prepared for Mr. Trump and has been known for several months, some lawmakers said after briefings this week at the White House.It couldn’t be learned why the NSA differed from others—including the Central Intelligence Agency—about the strength of the intelligence. The differences weren’t over the central assessment that operatives with Russia’s GRU intelligence agency paid bounties to the insurgent Taliban movement to kill Americans, some of the people said.In the nuanced practice of intelligence analysis, which involves piecing together sometimes incomplete and ambiguous bits of data, such disagreements aren’t unusual, and sometimes stem from institutional differences, experts and former officials have said.The NSA focuses on electronic eavesdropping, mining intercepted phone conversations, texts and emails, and other electronic signals. The CIA’s role is human intelligence, which on battlefields such as Afghanistan often means interrogation of enemy detainees.The NSA in the past has been more conservative than other U.S. intelligence agencies in its analysis of high-profile intelligence matters involving Russia. A January 2017 intelligence-community assessment of Russian interference in the 2016 presidential election, ordered by then-outgoing President Obama, stated that while the CIA and Federal Bureau of Investigation had “high confidence” that Russian President Vladimir Putin aspired to help Mr. Trump’s electoral chances, the NSA reported only “moderate confidence” of that finding.

WaPo Admits 'Russian Bounties' Info "Deemed Sketchy" After Pentagon Says "No Corroborating Evidence" - Congressional leaders have demanded answers, and those answers have come in the form of multiple US intelligence agencies and chiefs essentially throwing cold water on the NY Times Russian bounties to kill American troops in Afghanistan story, as we've detailed. We expect this "bombshell" will be very short-lived, perhaps being memory holed by the weekend, akin to the fate of other Russiagate-related 'anonymous sources say' type stories.  The Pentagon is the latest to say that DOD-wide there is currently "no corroborating evidence at this time to validate the recent allegations regarding malight activity by Russian personnel against US forces in Afghanistan," according to a late Tuesday evening statement by Defense Secretary Mark Esper. And yet the Times is busy publishing photos of slain Marines to help bolster what's increasingly looking like a propaganda hit piece ahead of the November election, for which there's already been considerable backlash from the public.As of Wednesday it's been revealed that a highly respected career intelligence officer previously made the decision to not brief President Trump on what the Washington Post now belatedly admits was widely "deemed sketchy" information the CIA had obtained in 2019 through either a foreign source or report. This line from the Post is certainly awkward for them and the Times: The Washington Post reported on Tuesday that White House officials were first informed in early 2019 of intelligence reports that Russia was offering the bounties to kill U.S. and coalition military personnel, but the information was deemed sketchy and in need of additional confirmation, according to people familiar with the matter.  National security adviser Robert O'Brien said in a Wednesday FOX interview, reported by WaPo that it's "another false story." "The president was not briefed because at the time of these allegations they were uncorroborated," he said. "As a result, the president's career CIA briefer decided not to brief him because it was unverified intelligence, and by the way, she's an outstanding officer, and knowing all the facts I know, I certainly support her decision."

One China, two Trump China policies: 'Peaceful coexistence' v. existential threat - President Trump has confirmed former national security adviser John Bolton’s most serious allegation: that, at least temporarily, he virtually endorsed Xi Jinping’s Uighur concentration camps in China. Asked whether he declined to impose sanctions against China, Trump said: “Well, we were in the middle of a major trade deal. … [W]hen you’re in the middle of a negotiation and then all of a sudden you start throwing additional sanctions on — we’ve done a lot.” It was not a proud moment for Trump or for America. Yet, just three days later, Bolton’s replacement as director of the National Security Council, Robert O’Brien, delivered a powerful indictment of the Chinese Communist government and criticized prior administrations’ “passivity” in the face of Beijing’s violations of international law and norms. Months earlier, O’Brien gave ascathing critique of the international community’s failure to respond to the Uighurs’ plight: “Where is the world? We have over a million people in concentration camps. I’ve been to the genocide museum in Rwanda. You hear ‘Never again, never again is this going to happen,’ and yet there are re-education camps with over a million people in them.” Vice President Mike Pence, Secretary of State Mike Pompeo, Defense Secretary Mark Esper, Deputy National Security Adviser Matt Pottinger and other administration officials all have pushed to help the Uighurs by punishing responsible Chinese officials. No administration member was muzzled or reprimanded, despite ongoing trade talks and Xi’s deep resentment at America’s “interference in China’s domestic affairs.” As Congress moved legislation to do just that, Trump offered no objection and did not press Republicans to oppose it. The bill sailed through and he signed it into law with a strong supporting statement. How to square this circle? Trump campaigned as a transactional operator who could significantly change the status quo in ways his predecessors could not or would not. He was a master of high-stakes negotiations: demanding much and settling for less, playing mind games, all to keep his opponents off balance. He argued in 2016 that those same business methods would work in foreign policy.

Trump insulted UK's May, called Germany's Merkel 'stupid' in calls: report - Senior U.S. officials believed President Trump posed a danger to national security after phone calls to other heads of state, according to classified phone calls obtained by CNN.The CNN report claims that multiple high-ranking administration officials, such as former National Security Advisor John Bolton, former Defense Secretary James Mattis, and former Secretary of State Rex Tillerson, concluded that the president was "delusional” after the phone calls. Trump reportedly told Theresa May, the former prime minister of the United Kingdom, that she was "a fool" and spineless in her approach to Brexit, NATO and immigration policy. He also told German Chancellor Angela Merkel that she was "stupid” and accused her of being in the pocket of the Russians. Sources told CNN he “demeaned and denigrated” the two female leaders in “near-sadistic" verbal attacks.   Merkel reportedly took the attacks gracefully, letting Trump’s quips go "like water off a duck's back.” May, on the other hand, got “flustered and nervous" when the president got aggressive with her.  "He clearly intimidated her and meant to,” one source told CNN.  A German official told CNN that Merkel decided to shrink her circle of advisors monitoring the calls with Trump because “they are indeed problematic." The CNN report also claims that Trump “bullied and disparaged” other leaders, such as French President Emmanuel Macron and Canadian Prime Minister Justin Trudeau. Meanwhile, Tump was quite friendly with Russian President Vladimir Putin and Turkish President Recep Erdogan, though sources told CNN officials that they were concerned about how unprepared the president would arrive at meetings.

 Citing COVID-19 spread, EU denies US citizens entry to Europe - In a devastating blow to the prestige of the United States, the European Union ruled Friday night that it would deny US citizens entry to Europe due to concerns over COVID-19. Shock and disbelief are mounting as the United States, the world’s wealthiest and most powerful country, continues to register by far the world’s highest toll in coronavirus cases and deaths, and the US government aggressively opposes health measures critical to stopping the pandemic. With over 2.6 million cases and 130,000 deaths, the US has de-funded the World Health Organization (WHO) and repudiated confinement policies key to halting the virus. Even as COVID-19 is tearing through factories and working class communities, President Donald Trump is calling for a limit on testing. At an election rally last week in Tulsa, Oklahoma, he said: “When you do testing to that extent, you’re going to find more people, you’re going to find more cases… So I said to my people, ‘Slow the testing down, please.’ They test and they test!” Such comments, evincing utter contempt for the health and well-being of the public, are rapidly undermining Washington’s position overseas, with far-reaching implications. EU officials presented a short list of countries where COVID-19 is not spreading any more rapidly than in Europe, and whose nationals are therefore allowed to enter the EU. These include Australia, Canada, New Zealand, South Korea, Japan, Rwanda, Thailand, Uruguay, Algeria, Morocco, Tunisia, Georgia, Montenegro and Serbia. Chinese travelers are also to be allowed into the EU if Chinese officials allow European travelers into China. However, US citizens will not be admitted. As the decision was being prepared, details of the discussions were leaked to the New York Times. It published a concerned article making clear that what was involved in this decision was far more than whether or not American tourists will be able to sight-see in Europe this summer. Noting that the EU decision “would lump American visitors in with Russians and Brazilians as unwelcome,” the Times called it “a stinging blow to American prestige in the world and a repudiation of Trump’s handling of the virus in the United States.” However, the Times did not treat the matter simply as one of public health or wounded national pride. It added that such a decision “would have significant economic, cultural and geopolitical ramifications.” In its article, the French daily Le Monde made clear that the EU had taken the decision, bucking US pressure, to send a signal. Without naming the United States, it wrote: “Will this decision have political consequences? While certain pressures were undoubtedly brought to bear and certain EU countries clearly had difficulty conceiving of banning certain nationalities, for economic, strategic and tourist reasons, a decision to make a ‘strong commitment’ was taken, diplomats said.”

 Senate passes extension of Paycheck Protection Program -The Senate has passed an extension of the popular Paycheck Protection Program for small businesses, which was set to close down Tuesday night with $130 billion in funding left over. The extension to Aug. 8 was offered by Sen. Ben Cardin, D-Md., and cleared the chamber by unanimous consent. The House has yet to take up the bill but could pass it as soon as Tuesday night. The Small Business Administration, which runs the program with the Treasury Department, is set to stop accepting new applications at 11:59 p.m. Eastern Time on Tuesday. The $659 billion program had approved more than 4.8 million loans totaling $520.6 billion as of Tuesday night, the SBA said. There was $134.5 billion remaining as of Saturday that will be returned to Treasury unless Congress repurposes it. Cardin said that the June 30 deadline was a "reasonable assumption" when the PPP program was established in March. "We thought by the end of June that our economy would be back on track and we would not need to have additional applications after that date." PPP loan money used for payroll in accordance with guidelines do not have to be repaid. Sen. Rick Scott, R-Fla., attempted to amend the extension to limit future loans to the most needy businesses, but dropped that attempt in the face of objections from Cardin, who said the PPP could be modified in the next round of stimulus. Sen. Susan Collins, R-Maine, said the PPP was likely to be modified next month so that businesses must show revenue losses in order to qualify for future loans. The Senate is about to leave on a two-week recess on Thursday amid a worsening economic outlook because of a resurgence of the coronavirus. Senate Majority Leader Mitch McConnell said earlier Tuesday that the Senate would take up and debate another virus relief package in late July.

House clears extension of PPP to August - The House gave final last-minute congressional approval Wednesday to extending the popular Paycheck Protection Program for small businesses until Aug. 8, hours after the deadline for applications lapsed with more than $130 billion still available. The Senate had passed the extension Tuesday, shortly before the Small Business Administration was to stop accepting new loan applications at 11:59 p.m. Both chambers used expedited procedures to send the bill to President Trump, who was expected to sign it, according to a person familiar with the matter. The program was enacted in March as part of the $2.2 trillion coronavirus relief package. The extension measure is S. 4116. The $669 billion program approved more than 4.8 million loans totaling $520.6 billion by Tuesday night, the SBA said. The $134.5 billion that remained as of Saturday would eventually have been returned to the Treasury if Congress didn’t extend the program. Even as lawmakers agreed to extend the current program, members of both parties were demanding more detailed information on how the funds have been spent so far. Others are proposing modifications or calling for new initiatives to help companies that are hardest hit by the pandemic or excluded from the program. Small-business advocates said they expect those ideas to be part of negotiations on a broader economic stimulus bill later in July. Treasury Secretary Steven Mnuchin told a House committee Tuesday that the Trump administration supports enacting additional stimulus legislation by the end of July. He said he’s had discussions with the Senate about revising the Paycheck program to help restaurants, hotels and other hard-hit businesses. This week’s scramble to extend the program came as Congress prepares to leave on a two-week recess amid a worsening economic outlook because of a resurgence of the coronavirus. Maine Republican Senator Susan Collins said Wednesday that bipartisan negotiators are close to a deal on a revival of the paycheck protection program. She is urging Congress to enact a second round of forgivable loans for companies after their revenue dropped by 50% or more compared to last year. To stretch the remaining PPP funds, she said she supports limiting the loans to businesses with 300 or fewer employees.

Trump signs PPP extension - President Trump on Saturday signed legislation that extends the deadline for businesses to apply for aid under the Paycheck Protection Program (PPP). The bill extends the deadline for businesses to apply for PPP loans until Aug. 8. The program, set up to help assist businesses impacted by closures related to the coronavirus pandemic, had expired on Tuesday night with roughly $130 billion left unused. The Senate in a surprise passed legislation by unanimous consent late Tuesday extending the program, hours before it was set to expire. The House took up the Senate bill and passed it by unanimous consent Wednesday afternoon, sending it to Trump’s desk. The lending program was established by the $2 trillion stimulus package negotiated by the White House and congressional leaders and signed into law at the end of March. The program experienced a chaotic rollout but has been popular, with the Small Business Administration lending over $520 billion in emergency loans to more than 4.8 small businesses. The extension comes as lawmakers on Capitol Hill prepare for negotiations over the next round of coronavirus stimulus. House Democrats passed a $3 trillion stimulus bill in May that included aid for state and local governments and another round of $1,200 direct payments to Americans, but the measure gained little traction in the GOP-controlled Senate. The White House pumped the breaks on further discussions, saying it needed to fully assess the impact of the stimulus already signed into law.

  Trump Administration Buys up Nearly All the World's Supply of Coronavirus Drug Remdesivir -- The U.S. has bought up almost all of the world's supply of remdesivir, one of only two drugs shown to work against the new coronavirus.  The move is in keeping with the Trump administration's "America first" buzzword towards the global pandemic and raises concerns about what the administration will do if and when a vaccine is developed.  "Imagine this was a vaccine," Liverpool University senior visiting research fellow Dr. Andrew Hill told The Guardian. "That would be a firestorm. But perhaps this is a taste of things to come."  The U.S. has secured more than 500,000 treatment courses of the drug through September, the Department of Health and Human Services (HHS) announced Monday. That amounts to 100 percent of drugmaker Gilead's production for July and 90 percent for August and September.   "President Trump has struck an amazing deal to ensure Americans have access to the first authorized therapeutic for COVID-19," HHS Secretary Alex Azar said in the announcement. "To the extent possible, we want to ensure that any American patient who needs remdesivir can get it. The Trump Administration is doing everything in our power to learn more about life-saving therapeutics for COVID-19 and secure access to these options for the American people."   But the administration's actions will make it harder for people in other countries to access the drug. "They've got access to most of the drug supply [of remdesivir], so there's nothing for Europe," Hill told The Guardian. Remdesivir was the first drug to be approved by U.S. licensing authorities to treat the new coronavirus. It is also the only drug currently approved by the European Medicines Agency to treat COVID-19, EuroNews pointed out. It has been shown to reduce the amount of time seriously ill coronavirus patients spend in the hospital from 15 to 11 days. It has not been shown to speed the recovery time of people with mild or moderate cases. There is also no evidence that it increases a patient's chance of surviving, according to The Independent.  The only other drug shown to work against the virus is a cheap and widely available steroid calleddexamethasone, which Oxford University researchers said had reduced the risk of death by a third in severely ill patients.

“A Scandal’: Contracts Show Trump Giving Big Pharma Free Rein to Price Gouge Taxpayer-Funded Coronavirus Drugs  - Government contracts obtained by consumer advocacy group Knowledge Ecology International show that the Trump administration is giving pharmaceutical companies a green light to charge exorbitant prices for potential coronavirus treatments developed with taxpayer money by refusing to exercise federal authority to constrain costs.Through the Freedom of Information Act, Knowledge Ecology International (KEI) last week got hold of a number of heavily redacted agreements between the Trump administration and major pharmaceutical companies like Johnson & Johnson, Regeneron, and Genentech.Five of the seven documents reviewed by KEI are classified as “other transaction agreements,” which allow federal agencies to loosen regulations designed to protect the public in order to help companies streamline the product development process.In the case of four contracts for potential Covid-19 treatments or vaccines with Johnson & Johnson, Genentech, Regeneron, and Roche issued by the Biomedical Advanced Research and Development Authority (BARDA) and the Pentagon, the Trump administration omitted a standard conditionrequiring that products developed with taxpayer money be made available to the public “on reasonable terms.”“This means that the government has limited its ability to intervene if the pharmaceutical companies (which are party to the agreements and are receiving hundreds of millions of dollars to conduct the research) charge unreasonable prices for the resulting Covid-19 vaccines or treatments,” KEI noted in a press release.KEI also found that federal contracts with Genentech and Regeneron for coronavirus treatments contain passages restricting the government’s ability to “have generic manufacturers make and distribute through pharmacies and other commercial outlets an effective diagnostic test, drug, or vaccine for Covid-19.” much worse, the Trump administration is making them unaffordable by giving out patent monopolies, otherwise they would be cheap generics— Dean Baker (@DeanBaker13) July 2, 2020

As coronavirus cases soar, Trump continues cheerleading for reopening the economy - While celebrating better-than-expected economic numbers at the White House on Thursday, President Trump conceded that the coronavirus outbreak wasn't over but insisted "we’re putting out the fires.” It's more like a blaze raging out of control. The president appears to be in denial as the country racks up record numbers of confirmed cases every day, with 50,000 reported Wednesday. Although Trump has continued to blame the rising caseload on increased testing, a larger percentage of tests are coming back positive than before, a clear sign that more people are growing sick. Florida reported more than 10,000 new cases Thursday, with nearly 17% of tests coming back positive. Arizona had more than 3,300, with 25% being positive. The latest daily figures from Texas showed 8,076 new cases. Nearly 14% of tests in recent days have found an infection. More tests are coming back positive in California as well; the state is seeing a surge in new cases after restrictions were loosened on restaurants and public gatherings. The nationwide death toll, which stands at over 128,000, has not yet accelerated — fatalities typically lag a few weeks behind infections. In several states, hospital officials fear being overrun with patients needing critical care, much like what New York experienced earlier this year when it was the epicenter of the country's pandemic. But Trump on Wednesday told Fox Business that "we're going to be very good with the coronavirus" and "at some point that's going to sort of just disappear." And on Thursday he described the coronavirus as more of a nuisance than a crisis, choosing to play cheerleader for a nascent economic resurgence that public health experts believe is contributing to the rising caseload. "We haven't totally succeeded yet. We will soon. We haven't killed all of the virus yet," Trump said during a White House event celebrating American businesses.

Arizona tells Pence it needs additional 500 health care workers as COVID-19 cases soar- Arizona Gov. Doug Ducey told Vice President Mike Pence on Wednesday that the state needed an additional 500 health care workers as the number of cases of COVID-19 continues to set records there.“We did hear in the briefing today of the need for personnel,” Pence said at a news conference following his meeting with Ducey.“We’ve already responded with 62 medical personnel arrived this week in Tucson, but the governor conveyed to us an additional request of another 500 personnel and I’ve instructed the acting secretary of homeland security to move out immediately on providing the additional nurses and doctors and technical personnel.”Pence said the federal government would be “moving out on that very quickly.”On the day of Pence’s visit to the state, Arizona reported a record number of new cases in a single day (4,878) as well as a new record for deaths from COVID-19 in a 24-hour period (88). While Arizona has, like other states across the country, increased testing in recent weeks, the percentage of positive results from those tests has been especially worrisome. On Wednesday, the state said that 28.3 percent of residents tested over the past 24 hours were positive for the disease caused by the coronavirus, the highest percent of any state in the nation. Pence noted that “more than 50 percent” of those who tested positive for COVID-19 in Maricopa County are under the age of 35. A week ago, President Trump attended an indoor “Students for Trump” rally in Phoenix that was attended by an estimated 3,000 people, few of whom wore face masks. Traveling with Pence in Arizona, Dr. Deborah Birx was adamant about the need for citizens to wear masks to slow the spread of COVID-19. “Wearing a mask will change the spread of this virus,” Birx, a top official on the White House Coronavirus Task Force, said.

Secret Service Agents Pulled From Pence’s Arizona Trip After Contracting COVID-19: WaPo  - Vice President Mike Pence’s visit to Arizona earlier this week was delayed by a day because at least one Secret Service agent preparing to travel with him tested positive for the coronavirus and others were showing symptoms, The Washington Post reports. Two senior administration officials cited by the Postsaid Pence was meant to head to Phoenix on Tuesday but had to wait another day so that Secret Service agents showing signs of the coronavirus could be replaced by healthy agents. One official said eight to 10 agents and other officers who were meant to travel with Pence wound up sick. The vice president was seen donning a mask as he arrived in Phoenix on Wednesday to meet with local leaders. His brief visit came as the state sees one of the worst COVID-19 outbreaks in the country since reopening, with 4,800 new infections confirmed in a single day on Wednesday.

Texas Lt. Gov. blasts Fauci as state coronavirus cases rise: ‘I don’t need his advice’ -- During a major surge in coronavirus cases in Texas, Lt. Gov. Dan Patrick blasted the nation’s top infectious disease expert for his response. Speaking as a guest on Fox News’ “The Ingraham Angle,” Patrick said Anthony Fauci “has been wrong every time on every issue.”“Fauci said today that he’s concerned about states like Texas that skipped over certain things,” Patrick told Laura Ingraham, a frequent critic of Fauci, on her June 30 show. “He doesn’t know what he’s talking about. We haven’t skipped over anything. The only thing I’m skipping over is listening to him.” Fauci’s comments came during a Senate hearing Tuesday when he also said the daily count of new COVID-19 cases in the United States could rise to 100,000 a day if current trends persist, CNN reported. But Patrick won’t be listening to Fauci. “We’ll listen to a lot of science, we’ll listen to a lot of doctors and Governor Abbott. Myself and other state leaders will make the decision — no thank you, Dr. Fauci,” he said Tuesday. Coronavirus cases surged during June in Texas. There are 159,986 total cases in Texas, the health department reported. The state’s seven-day average infection rate has been trending upward since late May, with record-breaking numbers of new coronavirus infections and hospitalizations reported in June, according to the Star-Telegram. “The worst thing we could do is lock down Texas again,” he added. “That’s not what Governor Abbott wants, that’s not what I want. That’s not what everyone wants in business or the Republican party wants.”

As pandemic accelerates in US, young people made the scapegoat of ruling elite’s malicious return to work policy -- On June 27, the number of COVID-19 cases surpassed 10 million cases. It has taken less than six days for another 1 million cases to be tallied with the cumulative death toll rising to 521,000 globally. Yet, international health organizations continue to warn that it is still not too late to employ an all government approach to public health in containing the devastation being wrought primarily on the working class. However, the “worst is yet to come” if the world continues to dismiss these admonitions. Yesterday, more than 200,000 new cases were reported among more than 200 nations with the United States, by itself, contributing an unprecedented 57,236, a one-day high that will undoubtedly be surpassed as the pandemic becomes more deeply entrenched in the country, with almost every state reporting a rise in new cases. By comparison, Europe had only 13,507 new cases and 413 fatalities. Concerningly, the number of new cases is beginning to rise again throughout the continent and it may very well see another surge of cases. With Independence Day weekend coming up, it seems certain that celebrations will fuel the raging pandemic. Even the New York Times writes in disbelief that 30 days of rising new cases show the US outbreak spiraling out of control, citing that the US has set a single-day record five times in little over a week. Officials have been warning their communities to celebrate at home as the health systems in the hardest-hit states are reaching capacity. Florida has had a single-day high of over 10,100 cases. Texas recorded 8,240 new cases yesterday. California, Arizona, Georgia, Louisiana, Tennessee and the Carolinas have registered more than 1,000 new daily cases. Additionally, Ohio and Kansas had seen single-day highs recently when, by all accounts, things were “going well.” Since reaching its ebb on June 7 after the initial peak on April 10, the number of new cases has returned to its previous accelerating trajectory. There is a clear correlation between the poorly conceived reopening of the economy—the lifting of restrictions and the mandatory return to work, policies agreed to and supported by the entire political establishment—and the lack of any well-organized concrete public health initiative such as contact tracing, testing, isolation of contacts, and care of those infected. The situation is brazenly careless as the country is flying blind through this second surge, ignoring all the lessons of the last few months.

No Social Distancing or Mask Requirement at Trump's Mt. Rushmore Fireworks Event -- Fire experts have already criticized President Trump's planned fireworks event for this Friday at Mt. Rushmore National Memorial as a dangerous idea. Now, it turns out the event may be socially irresponsible too as distancing guidelines and mask wearing will not be enforced at the event, according to CNN.The fireworks event at the iconic monument in South Dakota will be the first in more than a decade, and it will bring together thousands of supporters who will be crammed together in a fenced-in area for a view of the display. The event is happening as coronavirus cases are surging across the country, amidst a drought in South Dakota that makes the surrounding trees flammable, and during a national conversation about rethinking monuments with racist histories.South Dakota's Republican Governor Kristi Noem said the people who attend the celebration will be asked to choose their own comfort level with social distancing and mask wearing. While masks will be handed out to anyone who wants them, they will not be required, according to NBC News. "We will have a large event at July 3rd. We told those folks that have concerns that they can stay home, but those who want to come and join us, we'll be giving out free face masks, if they choose to wear one. But we will not be social distancing," Noem said on Fox News on Monday night, as NBC News reported. "We're asking them to come, be ready to celebrate, to enjoy the freedoms and the liberties that we have in this country."

Coronavirus: Red Cross slams US and Brazil response - The Red Cross has criticized a number of countries, particularly the United States and Brazil, for their handling of the pandemic. Francesco Rocca, president of the International Federation of the Red Cross and Red Crescent Societies (IFRC), warned that in the Americas especially, there were terrible consequences to the mixed and partisan rhetoric from politicians, often contradicting scientific advice. "America as a continent is paying the highest price for this kind of division or not following the advice coming from the scientific community," he told a virtual briefing hosted by the UN correspondents' association in Geneva. The United States is the worst-hit country in the world, with a quarter of global cases and deaths, followed by Brazil, which has suffered almost 60,000 fatalities and more than 1.4 million infections of the novel virus. Rocca said Brazilian President Jair Bolsonaro "underestimated the consequences of COVID, and his country is living the consequences." Bolsonaro has frequently ignored social distancing guidelines, while shaking hands and giving hugs at rallies, as well as hosting barbecues, all of which have been conducted with no sign of a face mask. The president also once compared the coronavirus to a "little flu."

White House threatens veto on Democrats' $1.5 trillion infrastructure plan  - President Trump threatened to veto House Democrats' $1.5 trillion green infrastructure plan on Monday, arguing it should eliminate or reduce environmental reviews and doesn't route enough money to rural America. The bill contains billions to repair the nation’s crumbling roads and bridges while setting aside funds for broadband, schools and hospitals. It would also require states to commit to reducing greenhouse gases and other climate measures in order to receive funding. But Republicans have branded it as an iteration of the Green New Deal crafted without their input. “This bill is problematic for several reasons. It is heavily biased against rural America. It also appears to be entirely debt-financed. And it fails to tackle the issue of unnecessary permitting delays, which are one of the most significant impediments to improving our infrastructure,” the White House wrote in a statement of administrative policy, saying the bill “is full of wasteful ‘Green New Deal’ initiatives.” The veto message gives added fuel to Senate Republicans, as Senate Majority Leader Mitch McConnell (R-Ky.) has not expressed a willingness to bring the bill to the Senate floor. The 2,300-page Moving Forward Act rolled out by Democrats this month is slated for a vote as soon as this week. House Ways and Means Committee Chairman Richard Neal (D-Mass.) has called it “the largest tax investment in combating climate change Congress has ever made.” But the veto message reiterated Trump’s interest in paring down the environmental reviews that accompany major projects, calling the delays caused by permitting “one of the biggest roadblocks to improving the nation’s infrastructure.” The bulk of the Democrats' infrastructure package is geared toward transportation measures that funnel money to public transit and would also require states to consider climate change when weighing projects. “Those who don't believe in climate change, tough luck. We're going to deal with it,” House Transportation and Infrastructure Committee Chairman Peter DeFazio (D-Ore.) said when the bill was unveiled. The White House memo called the bill “heavily skewed toward programs that would disproportionately benefit America’s urban areas” while appearing to be “financed solely by the government taking on additional debt.”

IRS proceeding with July 15 filing deadline - The Treasury Department and IRS said late Monday that they are proceeding with a July 15 tax-filing deadline, after Treasury Secretary Steven Mnuchin last week left the door open to an additional extension.  Treasury and the IRS in March extended the tax filing and payment deadlines from April 15 to July 15, due to the coronavirus pandemic. As is typically the case, people can request a filing extension to Oct. 15. "After consulting with various external stakeholders, we have decided to have taxpayers request an extension if more time is needed,” Mnuchin said in a news release late Monday. “I would encourage Americans to file their taxes as soon as possible, so those who are due refunds can receive them quickly.” IRS Commissioner Charles Rettig said that "the IRS understands that those affected by the coronavirus may not be able to pay their balances in full by July 15, but we have many payment options to help taxpayers.” He added that many of these options are available on the IRS's website and don't require taxpayers to contact an agency representative. The news that the filing deadline is staying in place comes after Mnuchin last week said that he was thinking about whether the deadline should be extended again. He said that it made sense to extend the deadline in March because people were unable to meet with their tax preparers, but that most people have already filed their 2019 tax returns. The IRS said that as of June 19, it has received about 138 million returns and has processed about 127 million of those documents. The IRS typically receives more than 150 million returns in a year, including extensions. As of June 19, the number of processed tax returns was down 11.4 percent on a year-over-year basis, and the number of refunds was down 10.8 percent, according to IRS data. Some prominent conservatives, such as Americans for Tax Reform President Grover Norquist, had encouraged the IRS to extend the payment deadline to help taxpayers with their cash flow, but wanted to keep the filing deadline in place to ensure that people get refunds sooner rather than later.

IRS watchdog details coronavirus-related challenges for taxpayers - The IRS's in-house watchdog on Monday released a report describing challenges facing taxpayers in light of the coronavirus's effects on IRS operations."The spread of COVID-19 brought much of the country to a grinding halt, and that was largely true of the IRS’s operations — and right in the middle of the filing season no less," National Taxpayer Advocate Erin Collins wrote. "Despite the IRS’s best efforts, there have been notable adverse taxpayer impacts." The IRS directed most employees to evacuate the agency's offices in late March in order to reduce workers' risk of exposure to the coronavirus. Employees have been able to perform some of their responsibilities while working from home, but other key IRS responsibilities, such as processing paper tax returns, could not be performed remotely. The agency has started to bring back workers, but it has a backlog of work. Collins said that taxpayers who filed paper tax returns may have to wait a considerable amount of time to get their refunds. The agency estimated that as of May 16, it had a backlog of 4.7 million paper filings, according to the report. "Although the IRS is reopening some of its core operations, it is not clear when it can open and log all the returns sitting in mail facilities," she wrote. Collins also said that there are some taxpayers who are experiencing long delays in getting their refunds because the IRS's processing filters mistakenly flagged them. Some of these refund delays have occurred for low- and middle-income families claiming certain tax credits, she said. "Affected taxpayers are often asked to mail in documentation to substantiate their claims, but the IRS has not opened or processed many of their responses, delaying their refunds," Collins wrote. "Refund delays can have a significant financial impact on low-income taxpayers, as refunds often constitute a significant percentage of their annual household incomes." Collins noted that the IRS coronavirus-related closures made it harder to taxpayers to get assistance both in person and over the phone. While the agency has started to reopen, it will take a while for its customer service operations to return to full capacity, the report said. Collins said that the IRS has started to process a backlog of notices that couldn't be mailed while IRS campuses were closed, but that some of these notices have due dates that have already passed. Instead of reissuing the notices, the IRS is including inserts in the notices that include updated deadlines. This could cause confusion for taxpayers, she said.

 Powell and Mnuchin Agree to Work with a Proposed “Department of Reconciliation” to Deal with Effects of Slavery and Segregation -  Pam Martens -Both Fed Chairman Jerome Powell and Treasury Secretary Steve Mnuchin raised their hands yesterday during the House Financial Services Committee hearing to agree to work with a proposed Department of Reconciliation to deal with the country’s history of slavery, segregation and ongoing “invidious discrimination” of people of color.The hearing had been called by the Chair of the Committee, Maxine Waters, to take testimony on “Oversight of the Treasury Department’s and Federal Reserve’s Pandemic Response.” That topic was frequently framed around questions of racial discrimination and inequality.The raised hands from Powell and Mnuchin came in response to questioning from Congressman Al Green of Texas, a Democrat who can reliably be counted on to ask probing, cogent questions of witnesses that come before the Committee. Green started off his questioning yesterday like this: According to the latest HMDA [Home Mortgage Disclosure Act] data, in 2019 the vast majority of home purchase loans went to white borrowers at approximately ten times that of loans that went to black and AAPI [Asian American and Pacific Islander] borrowers. Here are the numbers: the share that went to white borrowers – 60.3 percent; to Hispanic borrowers, 9.2 percent; to AAPI borrowers, 5.7 percent; and to black borrowers, 7 percent…“Even when lending discrimination does not result in outright denials of credit, it drives up borrowing costs for minority home buyers. Loans to black and Hispanic borrowers continue to be higher-priced for both conventional and non-conventional loans in 2019…“Adjusting for education, credit score, assets and other relevant factors, do you believe that invidious discrimination in lending exists against borrowers of color?…If you do believe so, would you kindly extend a hand into the air.”Mnuchin played with his reading glasses in his hand until he saw what Powell was going to do. Once Powell raised his hand, Mnuchin followed. Green then asked both if they felt that legislation should play a part in ending this invidious discrimination. Both answered in the affirmative. Green then said this:I believe that it’s time for us to reconcile in this country. We’ve survived slavery but we didn’t reconcile. We survived the invidious discrimination that exists now; segregation; but we haven’t reconciled. If we had a Department of Reconciliation with a Secretary of Reconciliation, would you work with a Secretary of Reconciliation…If so, raise your hand.”Mnuchin, again, waited to see what Powell was going to do. Powell, hesitated, then raised his hand, saying “not sure what this is.” Mnuchin, then, finally, also raised his hand.

Rubio, Warren to introduce pharmaceutical supply chain review legislation - Two U.S. senators want a review of the U.S. drug manufacturing industry, claiming that the ongoing coronavirus pandemic exposed a dependence on drugs manufactured in China and other countries. Reuters reported Tuesday that Sens. Marco Rubio (R-Fla.) and Elizabeth Warren (D-Mass.) will introduce a bipartisan bill Tuesday that would establish a study on the effects of the U.S.'s reliance on foreign companies when it comes to acquiring necessary medicines. The bill would reportedly require the Federal Trade Commission and Treasury secretary to conduct the research. Rubio told Reuters that the bill would provide lawmakers the information necessary to address inefficiencies in the U.S. supply chain. “To defeat the current COVID-19 crisis and better equip the United States against future pandemics, we must take control of our supply chain and rely less on foreign countries for our critical drugs," added Warren in a statement to the news service. An aide told Reuters that Rubio and Warren want to get a sense of all foreign investment in domestic pharmaceutical firms. Earlier this year, calls grew for the U.S. to reduce its decades-long dependence on China for key medicines and supplies as Americans faced widespread shortages in the midst of the coronavirus pandemic. Lawmakers and Trump administration officials said the virus exposed just how vulnerable the U.S. was as it leaned on China and other nations to help provide the tools necessary to combat the pathogen. Peter Navarro, President Trump’s economic adviser, pledged in April that the United States would move away from its reliance on other nations and toward building up its own capabilities to produce drugs and medical supplies. "One of the things that this crisis has taught us, sir, is that we are dangerously overdependent on a global supply chain," Navarro said during a White House press briefing, standing next to Trump. "Never again should we rely on the rest of the world for our essential medicines and countermeasures."

Republicans introduce Senate bill to abolish strong encryption on consumer devices - Three Republican Senators introduced a bill on June 23 that would force tech companies to allow US law enforcement back door access to encrypted data and communications on consumer electronic devices and applications. Senate Judiciary Committee Chairman Lindsey Graham (Republican from South Carolina), US Senators Tom Cotton (Republican from Arkansas) and Marsha Blackburn (Republican from Tennessee) proposed the draft bill called the Lawful Access to Encrypted Data Act. The senators called the measure a “balanced solution to bolster national security” that would end what they call the “warrant proof” encryption on smartphones, tablets and computers that is used by “terrorists and other bad actors to conceal illicit behavior.” The press release accompanying the introduction of the bill says that it would “require service providers and device manufacturers to provide assistance to law enforcement when access to encrypted devices or data is necessary—but only after a court issues a warrant, based on probable cause that a crime has occurred, authorizing law enforcement to search and seize the data.” As has been repeatedly argued by the tech industry and data security experts, there is no way to develop “lawful” access to encryption without breaking the entire system that is now being used—especially in the wake of revelations of illegal government surveillance of electronic communications—by billions of people around the world. Stopping short of naming specific companies—such as Apple, which has so far refused to grant the FBI or local police departments access to encrypted data on its iPhones—Cotton said of the bill, “Tech companies’ increasing reliance on encryption has turned their platforms into a new, lawless playground of criminal activity. Criminals from child predators to terrorists are taking full advantage. This bill will ensure law enforcement can access encrypted material with a warrant based on probable cause and help put an end to the Wild West of crime on the internet.”;

 US Supreme Court rejects environmental groups’ appeal to halt border wall construction - On Monday the US Supreme Court aligned itself with the Trump administration’s inhumane and unconstitutional immigration policy by rejecting an appeal made by four environmental groups who argued that the federal practice of waiving environmental statutes and other laws to enable border wall construction is unconstitutional. Monday’s rejection by the Supreme Court follows last week’s 7-2 decision which declared that recent asylum seekers have no constitutional right to due process or habeas corpus and therefore cannot challenge the legality of their deportation before they are removed. The plaintiffs in this case, known as Center for Biological Diversity v. Wolf, argued that the Illegal Immigration Reform and Immigrant Responsibility (IIRAIRA) Act of 1996, passed by a bipartisan congressional majority and signed into law by Democrat Bill Clinton, is unconstitutional because it cedes lawmaking powers to the executive branch. The act gave the US government broad authority to militarize the border and preempt legal requirements, as well as limit the types of legal challenges that can be brought forward. At the time of the bill’s signing, Clinton argued that the new legislation would uphold “the rule of law by cracking down on illegal immigration at the border, in the workplace, and in the criminal justice system—without punishing those living in the United States legally.” History has proven this to be a lie. The signing of the act has severely eroded the rule of law for immigrants and asylum seekers by eliminating due process from a majority of removal cases, mandating detention in crowded and COVID-19-infested concentration camps and erecting barriers to family reunification based on income. In addition as part of the act, the Department of Homeland Security (DHS) is granted “unfettered discretion” to issue waivers which bypass legislation such as the National Environmental Policy Act, Endangered Species Act, and other laws to construct fencing, guard towers, walls and roads along the border with Mexico. The Trump administration, through DHS, has used the 1996 law to apply for dozens of waivers to expedite the construction of the wall. Congress created the waiver authority in 1996 and expanded its usage in 2005. According to the groups’ petition to the court, the Trump administration had applied for 16 waivers to exempt the DHS from more than 40 laws written to protect clean air, water, public lands as well as endangered animals.By refusing to hear the case, the Supreme Court has given the Trump administration a green light to continue building 145 miles of border fencing along the US-Mexico border in California, Arizona, New Mexico and Texas.

Justice Roberts Swings Another SCOTUS Ruling; Blocks Louisiana Abortion Law - The U.S. Supreme Court on Monday morning supported abortion rights by striking down a Louisiana law regulating abortion clinics, reported Bloomberg. The 5-4 ruling, with conservative Chief Justice John Roberts siding with the court's four liberals, determined that the law requiring doctors who perform abortions have admitting privileges at nearby hospitals violates the abortion right the court first published in the Roe v. Wade decision in 1973. The Louisiana law is similar to the one in Texas that the court struck down in 2016 - making this the first big abortion case of the Trump era. "The result, in this case, is controlled by our decision four years ago invalidating a nearly identical Texas law," Roberts wrote.  "The legal doctrine of stare decisis requires us, absent special circumstances, to treat like cases alike," he wrote. "The Louisiana law imposes a burden on access to abortion just as severe as that imposed by the Texas law, for the same reasons. Therefore Louisiana's law cannot stand under our precedents." As JustTheNews' Sophie Mann noted, one speculation going into this ruling was that the reputation of the Roberts' court would suffer if the body used the Louisiana case to overturn its previous ruling on the Hellerstedt case. Though Roberts was not the deciding vote in 2016, and the court has added several conservative-leaning justices since that time, Roberts has made it clear that a top priority of his is maintaining the integrity of the court.  This is the third time this month Chief Justice Roberts has sided with the liberals of the court on a hot-button social issue (protecting DREAMers, upholding LGBTQ employment rights, and now striking down state abortion restrictions). As Daily Caller's Mary Margaret Olohan notes, this SCOTUS ruling comes after Senate Minority Leader Schumer warned Justice Brett Kavanaugh and Justice Neil Gorsuch that they “won’t know what hit you if you go forward with these awful decisions,” related to the abortion case.

Supreme Court hands win to religious schools  - The Supreme Court ruled on Tuesday that a Montana policy that excludes religious schools from a general student aid program violates religious freedoms protected under the U.S. Constitution.The 5-4 majority decision, which fell along ideological lines, said that by making state-backed private school scholarships off-limits to parochial schools, the program ran afoul of the First Amendment's free exercise of religion, which prohibits the government from treating religious and secular groups differently.“A state need not subsidize private education,” Chief Justice John Robertswrote for the majority. “But once a state decides to do so, it cannot disqualify some private schools solely because they are religious.”The court’s four more liberal justices dissented. The dispute presented an overlapping conflict between a Montana tax-credit program that had the potential to benefit religiously affiliated schools, a provision of the state constitution that bars public aid to religious institutions and federal safeguards for religious freedom. The case arose after Montana’s top court struck down the program after finding it ran afoul of a Montana constitutional provision that bans state tax dollars from funding sectarian schools, which prompted several parents to appeal to the U.S. Supreme Court.

Facebook agrees to audit its hate speech controls - (Reuters) - Facebook Inc said on Monday it would submit itself to an audit of how it controls hate speech in a bid to appease a growing advertising boycott of the platform, as it prepared to address a group of advertisers on Tuesday.The move comes as major advertisers such as Unilever and Starbucks have signed on to the “Stop Hate for Profit” campaign started by U.S. civil rights groups, which urges brands to pause their Facebook ads in July to pressure the social media giant to do more to take down hate speech. Media Rating Council (MRC), a media measurement firm, will conduct the audit to evaluate how it protects advertisers from appearing next to harmful content and the accuracy of Facebook’s reporting in certain areas. The scope and timing of the audit were still being finalized, Facebook said.

Twitch Suspends Trump’s Account for ‘Hateful Conduct’ - Twitch and Reddit Inc. banned content linked to President Donald Trump for violating their rules against encouraging hate.Twitch, Inc.’s live streaming site, temporarily banned Trump’s account for reposting a 2016 speech in which he characterized Mexicans as rapists and a more recent speech in which he conjured up the image of an evil-doer breaking into a house.Reddit, a community-based social website, said it banned 2,000 discussion pages, including r/The_Donald for being one of the two biggest violators of rules against promoting hate based on identity.“Hateful conduct is not allowed on Twitch,” the company said in an emailed statement. “In line with our policies, President Trump’s channel has been issued a temporary suspension from Twitch for comments made on stream, and the offending content has been removed.”Trump has been much criticized for his infamous reference to Mexicans when he kicked off his presidential campaign five years ago.The second violation, cited by Twitch, referred to a portion of Trump’s recent rally in Tulsa, Oklahoma, where he outlined a scenario of “a very tough hombre” breaking into a sleeping woman’s house at night. “By the way, you have many cases like that, many, many, many,” Trump said, according a Twitch transcript of the speech.

Reddit bans 2,000 communities in major censorship action - In a major act of social media censorship, the news aggregation site Reddit banned more than 2,000 communities, known as subreddits, on Monday, claiming they were in violation of the platform’s new content policy against “hate speech.”The most prominent of the terminated subreddits was a right-wing forum called r/The_Donald, a pro-Trump group that was a notorious online gathering place for sharing racist, anti-Semitic and anti-Islamic memes, videos and other content. The subreddit had approximately 790,000 active members.Reddit executives, including CEO Steve Huffman, also a founder of the platform, argued that the group had regularly broken platform rules by allowing its members to target and harass others with hate speech. Huffman told reporters on Monday, “Reddit is a place for community and belonging, not for attacking people. ‘The_Donald’ has been in violation of that.”In an official statement on its content policy, Reddit wrote: “All communities on Reddit must abide by our content policy in good faith. We banned r/The_Donald because it has not done so, despite every opportunity. The community has consistently hosted and upvoted more rule-breaking content than average (Rule 1), antagonized us and other communities (Rules 2 and 8), and its mods have refused to meet our most basic expectations.” The full eight point content policy can found here: Reddit Content Policy.However, according to a report in the Washington Post, by the time Reddit shut down r/The_Donald, “there was little sign of recent activity. The most popular posts were several months old.”Meanwhile, hiding behind the banning of the widely despised subreddit r/The_Donald, Reddit executives also took action to shut down some 2,000 other groups, including a popular left-radical forum called r/ChapoTrapHouse, named after a popular podcast, which had approximately 160,000 users in its community.

Racial disparities persist in electric service. Is ‘willful blindness’ to blame?  - Black Americans and other minorities are more at risk for disconnections, add-on utility fees, inefficient housing and more. While it has long been known that Black and other minority customers are more likely to face service disconnections and higher bills due to inefficient housing, Ohio regulators are not taking significant steps to address those disparities — largely because they’re not looking for them. Utilities say they enforce policies against racial and ethnic discrimination, but few are collecting data that could reveal whether those policies are unintentionally creating or widening disparities for communities of color. “In my mind that borders on willful blindness” said Roger Colton, an attorney and economist in Belmont, Massachusetts, who has worked on energy and water utility cases. On average, African Americans pay a disproportionately greater share of their income for energy needs, said economic analyst John Howat at the National Consumer Law Center in Boston. Compared to white households, they also have higher frequencies of disconnections, disconnection notices and households foregoing other necessities to pay for energy. One of his analyses found that on a nationwide basis, African Americans earning less than 150% of the poverty level were about twice as likely to have their electricity shut off as white households with comparable incomes. The impacts were lower in the Midwest than in some other regions, but Black households still had a higher rate of disconnections. “So the big picture is that the data does identify disparities in home energy security generally by race,” Howat said. The Energy News Network asked the Public Utilities Commission of Ohio for data on customers whose electricity or natural gas service had been disconnected. If specific names and addresses could not be disclosed, the Energy News Network asked for census tract data on where disconnections occurred. The data could have been helpful for an informal sampling to gauge if areas with higher proportions of African Americans or other minority groups had disproportionate numbers of disconnections. “Unfortunately, the data is not as granular as you are requesting,” said PUCO spokesperson Matt Schilling. Utilities must file annual reports on disconnections for nonpayment. Data in various reports provide the total numbers of disconnections each month, notices of disconnections, security deposits, dollar amounts and numbers of customers. But there’s generally no breakdown by race, zip code or even county.

New York Times’ Charles Blow demands the removal of monuments to Washington and other “amoral monsters” --An opinion piece by New York Times columnist Charles Blow appeared online Sunday under the headline, “Yes, Even George Washington,” calling for the removal of all public monuments to the first President of the United States, whom Blow has judged to be among the “amoral monsters” who led the American Revolution and helped found the country 244 years ago. “On the issue of American slavery, I am an absolutist: enslavers were amoral monsters,” Blow declares. His argument is an extension of that advanced in the Times’ racialist 1619 Project, which claims that the aim of the American Revolution was to defend slavery against British plans for its abolition. Blow writes: “Some people who are opposed to taking down monuments ask, ‘If we start, where will we stop?’ It might begin with Confederate generals, but all slave owners could easily become targets. Even George Washington himself.” Blow then proclaims, with the special elegance that distinguishes his columns, “To that I say, ‘abso-fricking-lutely!’” Early Monday morning, not long after Blow’s column was published, the monument arch in Washington Square Park in New York City commemorating the centenary of Washington’s inauguration was vandalized with red paint. The paint dripped down from the heads of two statues of Washington, one depicting him as the commander of the revolutionary Continental Army and the other as president. This latest assault on a monument to Washington follows the pulling down last month of Washington and Jefferson monuments in Portland, Oregon, and the toppling of a bust of Civil War general and Reconstruction President Ulysses S. Grant in San Francisco, California. Monuments to Abraham Lincoln, who led the Second American revolution and destroyed slavery, as well as monuments to abolitionists such as Robert Gould Shaw and Hans Christian Heg, have come under attack as racist and “white supremacist.”

Trump responds to calls to tear down monuments with creation of 'National Garden' of statues - The White House unveiled an executive order Friday evening to create a “National Garden of American Heroes” that will feature statues of prominent Americans. The executive order, which President Trump announced during a Fourth of July celebration at Mount Rushmore, comes as the nation grapples with calls to tear down Confederate statues across the country and address other racist iconography. “These statues are silent teachers in solid form of stone and metal. They preserve the memory of our American story and stir in us a spirit of responsibility for the chapters yet unwritten. These works of art call forth gratitude for the accomplishments and sacrifices of our exceptional fellow citizens who, despite their flaws, placed their virtues, their talents, and their lives in the service of our Nation,” reads the executive order, which was disseminated by the White House. The executive order establishes the Task Force for Building and Rebuilding Monuments to American Heroes, which will be empowered to use funding from the Interior Department to establish the site. The task force has 60 days to submit a report to the White House detailing options for the creation of the National Garden, including potential locations. The executive order says the garden will include statues of John Adams, Susan B. Anthony, Clara Barton, Daniel Boone, Davy Crockett, Frederick Douglass, Amelia Earhart, Benjamin Franklin, Thomas Jefferson, Martin Luther King Jr., Abraham Lincoln, Ronald Reagan, Jackie Robinson and Harriet Tubman, among others. The garden will also “separately maintain a collection of statues for temporary display at appropriate sites around the United States that are accessible to the general public.” Under the order, the garden will be open prior to July 4, 2026, the 250th anniversary of the proclamation of the Declaration of Independence. The executive order also address current calls to topple Confederate statues, underscoring that other activists have called for the dismantling of monuments to figures who owned slaves but were not in the Confederacy, including former presidents George Washington and Thomas Jefferson.“To destroy a monument is to desecrate our common inheritance. In recent weeks, in the midst of protests across America, many monuments have been vandalized or destroyed. Some local governments have responded by taking their monuments down,” the order reads. “These statues are not ours alone, to be discarded at the whim of those inflamed by fashionable political passions; they belong to generations that have come before us and to generations yet unborn.”

Kellyanne Conway's 15-year-old daughter is defiantly posting anti-Trump and pro-Black Lives Matter TikToks 'to inform people and spread love' (includes videos) Claudia Conway, the daughter of White House adviser Kellyanne Conway, has grown a TikTok following of more than 31,000 followers while making anti-Trump and pro-Black Lives Matter posts. The 15-year-old told Insider she's an advocate for social justice and wants to use her platform "to inform people and spread love." She said her father — prominent Trump critic George Conway — supports her speaking her mind, but her mother has been apprehensive, asking her to delete her TikTok videos. Still, Conway called her mother a "badass" and called both her parents the "most well-educated people" she had ever met. "I believe that ignorance stems from a lack of education and a lack of knowledge, and I believe knowledge is power," the 15-year-old Conway said. "Even if you have opposite views of me as long as you're informed and able to see both sides, that's all that really matters."

Jeffrey Epstein Confidante Ghislaine Maxwell Arrested on Sex Abuse Charges  -- Ghislaine Maxwell, the British socialite and heiress who became a confidante of disgraced financier Jeffrey Epstein and was later implicated in his alleged sexual crimes, has been arrested by the FBI.  She was arrested in Bradford, New Hampshire, around 8:30 a.m. Thursday on charges she conspired with Epstein to sexually abuse minors. She was found living at a reclusive, million-dollar luxury home with 156 acres of rural mountainside property, federal prosecutors said. In a brief electronic appearance in New Hampshire federal court Thursday afternoon, a judge remanded her to the custody of the U.S. Marshals and ordered her transferred to New York City. She did not enter a plea, and her attorney indicated he will seek a detention hearing in New York, a prelude to a possible bail request.The six-count indictment in Manhattan federal court alleges that Maxwell helped Epstein groom girls as young as 14 years old, going back as far as 1994. Prosecutors say she was in the room during — and took part in — the sexual abuse of three underage girls at Epstein's Upper East Side townhouse, his Florida estate and his ranch in New Mexico. She faces up to 35 years in prison.   "This case against Ghislaine Maxwell is the prequel to the earlier case we brought against Jeffrey Epstein," Acting Manhattan U.S. Attorney Audrey Strauss said at a news conference on the indictment. The FBI said that it had been tracking her movements for some time, though she was not indicted until June 29.   The daughter of British media baron Robert Maxwell, Ghislaine was a one-time girlfriend of Epstein's and was at the high-flying investor's side for decades.   But she was also alleged to have helped Epstein groom teen girls for sex with the rich and powerful. One of those teens, Virginia Roberts Giuffre, leveled that charge against Maxwell in a 2015 defamation suit, as have a number of other women since.  "In some instances, Maxwell was present for and participated in the sexual abuse of minor victims," the indictment says.  Epstein, a registered sex offender who nonetheless kept company with presidents and captains of industry, was arrested last summer on new federal charges of exploiting dozens of underage girls in New York and Florida in the early 2000s.

Who is Ghislaine Maxwell, Jeffrey Epstein's alleged accomplice in sex trafficking? -- The arrest of British socialite Ghislaine Maxwell by the FBI on Thursday marks a new twist in the saga of the late sex trafficker Jeffrey Epstein and his connections to members of the upper echelons of global power. Maxwell was taken into custody without incident in New Hampshire. She is charged with facilitating Epstein’s procurement and abuse of underage girls. Her trial could shed light on accusations that have linked Epstein to well-known figures in the political, academic and social worlds. Maxwell is a 58-year-old British socialite and ex-girlfriend of Epstein and has been accused of being a key player in the financier’s alleged sex trafficking ring. Her whereabouts had been unknown since Epstein’s arrest last summer, frustrating lawyers of his alleged victims. Following her arrest, authorities said Maxwell had “slithered away to a gorgeous property in New Hampshire,” continuing to live a “life of privilege.” Epstein was arrested last July on charges of trafficking minors for sex. He died in August in his cell in New York in what was ruled a suicide by hanging, but numerous irregularities in the case, including the disappearance of surveillance tapes from the time in question, have led to widespread skepticism of the finding. Maxwell and Epstein have been accused of recruiting underage girls to perform sex acts for Epstein and his friends, a who’s who of high society. Epstein and Maxwell became romantically linked after she moved to New York in the early 1990s. In a 2003 Vanity Fair article, Epstein said Maxwell was his “best friend.” Maxwell was charged with facilitating the sexual abuse of underage girls by Epstein from 1994 to 1997. According to the 17-page grand jury indictment that was unsealed Thursday, she faces six counts: conspiracy to entice minors to travel to engage in illegal sex acts; enticement of a minor to travel to engage in illegal sex acts; conspiracy to transport minors with intent to engage in criminal sexual activity; transportation of a minor with intent to engage in criminal sexual activity; and two counts of perjury.

Ghislaine Maxwell’s Case Will Unearth Secrets Epstein Took to His Grave - The death of Jeffrey Epstein in a New York prison cell last summer robbed his accusers of a chance for justice and shut down the tantalizing possibility that the secrets of a sordid life spent among the rich and powerful might be revealed. Thursday’s arrest of Ghislaine Maxwell -- almost exactly a year after Epstein was arrested -- suggests a fuller accounting of his acts might yet come. The charges paint Maxwell as a central figure in Epstein’s criminal enterprise. She spent years at his side. He described her as his “best friend.” She was his girlfriend for a time, though their relationship truly deepened in the years Maxwell was organizing his affairs, an arrangement that included running his households and piloting his helicopter. And she stood at the very center of the web of wealthy and powerful figures surrounding Epstein. The network she inherited from her billionaire father, the late British publishing tycoon Robert Maxwell, gave Epstein access to the highest echelons of society. She even introduced Brooklyn-born Epstein to Britain’s Prince Andrew, whose connection to the pedophile has forced the British royal from public duties. What did she see? Whom might she incriminate? Those are just some of the questions a trial might explore. While Maxwell has repeatedly asserted her innocence, investigators and Epstein’s victims say she was the ringleader of the operation that coordinated years of sexual abuse in Florida, New York and beyond. Read More: Jeffrey Epstein Found Dead in Jail, Raising ‘Serious Questions’ Epstein’s high-powered network means there’s potential for a public reckoning that could tarnish top figures on Wall Street, in corporate America and in Washington. Perhaps more important, a trial would at long last give victims a chance to face at least one of their alleged tormentors.

Prince Andrew named in new lawsuit filed by woman claiming she met Duke before being raped by Jeffrey Epstein aged 17 - Prince Andrew has been named in a lawsuit filed in the US on Thursday by a woman claiming she was introduced to the Duke shortly before being raped by Jeffrey Epstein.Caroline Kaufman alleges that she was sexually abused by Epstein in 2010 when she was 17 at the late financier’s New York mansion while the Duke of York was visiting, in a civil suit filed on the same day as charges were brought against Epstein’s associate Ghislaine Maxwell. Ms Kaufman, now 26, said she was invited to the house for a “modelling interview”, according to a suit seen by The Telegraph that was filed at the Manhattan Federal Court against Epstein’s $630 million estate.Prince Andrew was pictured leaving the Upper East side townhouse in 2010, two years after Epstein was convicted by a Florida state court of procuring an underage girl for prostitution. The Duke claimed he had travelled to the US to cut off ties with Epstein.The suit will add to mounting pressure on the Duke to address allegations centering on his contact with Epstein and his former girlfriend Ms Maxwell.  It does not accuse the Duke of wrongdoing or of being aware of the alleged attack. He has previously said of his interaction with Epstein, who died in prison last year: "At no stage during the limited time I spent with (Epstein) did I see, witness or suspect any behavior of the sort that subsequently led to his arrest and conviction."The lawsuit alleges Ms Kaufman was told to strip naked and was photographed by “an older woman” she now believes to be Ms Maxwell.“Upon entering Epstein’s Manhattan home, Kaufman was introduced to a number of people. One of the individuals was Andrew Albert Christian Edward, aka, Prince Andrew, Duke of York,” it reads.

 Judge Rules Virginia Giuffre's Lawyers Must 'Destroy' Jeffrey Epstein Files - Attorneys for Virginia Giuffre, who publicly accused Jeffrey Epstein of sex trafficking, must destroy files they obtained on Epstein after a Wednesday ruling by a federal judge. Epstein was arrested in July 2019 on charges of sex trafficking and conspiracy to engage in sex trafficking. Allegedly, Epstein procured women to have sexual relations with high-profile individuals, such as Prince Andrew. Information about Epstein, culled from a 2015 civil suit filed against Epstein by Giuffre, allegedly contained the names of individuals with whom Epstein had conducted business. Senior U.S. District Judge Loretta Preska ruled Wednesday that Giuffre's lawyers had come into possession of the documents improperly, noting that the protective order could only be enforced during the civil lawsuit proceedings which had already been settled. Preska wrote that all the materials in the files "shall be destroyed." Preska also requested proof that the documentation had been destroyed. "Counsel shall submit an affidavit detailing the steps taken to do so," Preska's ruling added. Preska's ruling came after a request by attorney Alan Dershowitz to gain access to the documents. Giuffre has claimed that Dershowitz was one of the men Epstein forced her to have sex with. In response, Dershowitz sued Giuffre for defamation in 2019. Dershowitz claimed that obtaining the Epstein files would be an asset to his defense. Preska said in her ruling that Dershowitz's desire to see all of the files "with over a thousand docket entries" was not a "targeted strike" but a "carpet bombing." In a statement sent to Newsweek on Thursday, Dershowitz said the evidence should remain intact. "I oppose the destruction of evidence that may contain smoking gun proof that my false accuser made up her story," Dershowitz said. "I want all the evidence preserved because I have absolutely nothing to hide. I did nothing wrong. The evidence to be destroyed may also contain proof of wrongdoing by others. It should be preserved for appeal and for history. Destroying evidence risks destroying truth."

Central Mueller Witness, A Child-Trafficking Pedophile, Sentenced To 10 Years In Prison -- A Lebanese businessman and central witness in former special counsel Robert Mueller's Russia investigation was sentenced to 10 years in prison after pleading guilty in January to sex crimes involving minors. Lobbyist George Nader - who had ties to both the Clinton and Trump campaigns during the 2016 US election for Middle Eastern associates (and was later indicted for illegal contributions to Hillary Clinton's campaign) - was intercepted at Dulles Airport in January 2018 by agents working for Mueller. A search of his iPhones revealed child pornography, which we imagine was used as leverage to gain his cooperation.Three months later, prosecutors filed charges against Nader for the images - however they were filed under seal and kept secret from Nader's lawyers while he was working with Mueller.In July of 2017 - 15 months after Mueller let a serial pedophile roam the streets in the hopes he'd be able to nail Trump, Nader was finally indicted on both the child porn and for sex-trafficking a 14-year-old boy.Keep in mind, Mueller knew about Nader's 1991 conviction on child pornography charges in the US - for which he served only six months in a halfway house thanks to his role in helping to free American hostages in Beirut. He was also convicted in the Czech Republic in 2003 on 10 counts of having sex with underage boys, and eventually received a one-year prison sentence. Months after Nader's indictment for pedophilia, he was indicted on campaign finance charges in December 2019, along with Ahmad "Andy" Khawaja - a Lebanese-American businessman who has donated to Clinton, Adam Schiff, Joe Biden, Chris Coons, Dianne Feinstein and a host of other Democrats who received up to $3 million in campaign funds. He also gave $1 million to Priorities USA, the primary super PAC supporting Clinton, and $1 million to Trump's inaugural fund.

WaPo Does Damage Control After "Far More Damaging" Biden-Ukraine Tapes Disclosed - The Washington Post is trying to get ahead of what Rudy Giuliani says are "far more damaging" tapes of 2016 phone calls between former Vice President Joe Biden and former Ukrainian President Petro Poroshenko, which are set for release over the summer by a former Ukrainian diplomat. To review, Biden conditioned a $1 billion US loan guarantee on the firing of Ukraine's chief prosecutor, who was leading a wide-ranging investigation into Burisma - a Ukrainian energy company which hired Hunter Biden to sit on its board.In May, Ukrainian MP Andrii Derkach released recordings of Biden and Poroshenko which explicitly detail the quid-pro-quo arrangement to fire the prosecutor, Victor Shokin (which Biden already admitted to).  Biden's campaign says the tapes are part of a 'conspiracy theory to smear him' - while Poroshenko claims they are fabricated.In one of the May tapes, Poroshenko reports back with "positive news" that Shokin - "despite of the fact that we didn't have any corruption charges" - had been fired.Last week, more recordings of Biden and Poroshenko were published to the YouTube channel, "NABU Leaks," where the two can be heard discussing ongoing efforts by the United States to help Ukraine with various matters. And according to a Tuesday report in the Washington Post, more tapes are coming.  Both Giuliani and Lev Parnas, a Ukrainian-American businessman who served as his fixer in Ukraine, confirmed that they sought tapes of Biden last year. Giuliani said he received assistance in his pursuit from a source within the State Department, who he claimed pointed him to the dates of certain conversations between Biden and Poroshenko by accessing an official U.S. government archive. Giuliani told The Washington Post that he did not know the recently released recordings were coming before they were posted online last month. But in a recent interview with OAN, the former New York mayor claimed to be aware of other tapes that were “far more damaging,” saying, “I would hope that those tapes are put out also.” -Washington Post The Post calls the clips "heavily edited" and paints Derkach, the Ukrainian MP, as essentially a proxy for Vladimir Putin. They also suggest that "the efforts to promote the recordings in Ukraine and the United States — and pledges by other Trump allies to release more in the coming months — suggest a new push by foreign forces to sway American voters in the run-up to the 2020 election," and claim that the NABU leaks "further illustrate Trump’s willingness to benefit from foreign intervention in U.S. elections," despite offering no evidence that Trump is involved in the leaks.

Did Fed get it right on shareholder payouts?— The Federal Reserve’s cap on shareholder payouts by big banks immediately launched a second-guessing game within the banking industry, with many holding out judgment until the path of economic recovery from the pandemic is more certain. In the publication of its annual stress-test results, the Fed said it would require big banks to suspend share repurchases during the third quarter and limit dividend distributions to the levels banks paid out in the second quarter. Those distributions could also be limited further, the Fed said, depending on each individual bank’s earnings results. The central bank is also requiring the 34 banks with more than $100 billion of assets that it tested to resubmit their capital plans later this year. As part of its normal stress-testing cycle, the Fed also tested banks against hypothetical economic models of recovery from the pandemic as a supplemental exercise to its typical stress testing regime to account for the impact of COVID-19 on bank capital. While the results of those “sensitivity analyses” showed that banks would maintain the regulatory minimum capital requirements under different levels of economic stress, several banks were said to have approached the 4.5% minimum common equity Tier 1 capital requirement under the most severe scenarios. That revelation raised questions about whether the Fed should be doing more to ensure that banks hold onto capital. “The board ended up taking a middle position of modest restrictions now while expressing caution about the future,” said William Lang, managing director at Promontory Financial Group. “This runs somewhat counter to the lessons of the last crisis, which were that it was preferable to conserve capital while banks are in a stronger position.” Michael Barr, who worked on the Dodd-Frank law as former assistant secretary for financial institutions at the Treasury Department under the Obama administration, said that the central bank should have barred dividends altogether, like the agency did for stock buybacks. He added that the analysis done for justifying continued dividends was too backward-looking and did not take into account the possibility that the economy has not yet even hit the recovery stage as some areas are dealing with a surge in new COVID-19 cases. “We’re in the middle of an absolutely unprecedented global pandemic and economic collapse,” Barr said. “It doesn’t make sense to me. Now is the time that you want banks to raise additional capital to make sure they are even more resilient. At a minimum, the Fed should not be permitting dividend payments.” That sentiment was echoed by Fed Gov. Lael Brainard, who voted against allowing banks to continue paying dividends to shareholders, saying in a statement that she did “not support giving the green light for large banks to deplete capital.”

Wells Fargo to cut dividend; other big banks boost capital buffer - A number of big banking companies said they’ll be keeping third-quarter dividends steady, with one exception: Wells Fargo. Wells said it would be lowering its dividend from the 51 cents per share it paid in the second quarter, and that it plans to announce the exact figure when it reports second-quarter earnings on July 14. Meanwhile, seven banking companies — Goldman Sachs, Morgan Stanley, Capital One Financial, Ally Financial, Discover Financial Services, Citizens Financial Group and JPMorgan Chase — said they would set aside a stress capital buffer greater than the minimum of 2.5%. The announcements from a dozen companies, which came out gradually after the markets closed on Monday, were hotly anticipated after the Federal Reserve released stress test results last week that were complicated this year because of efforts to account for the devastating toll of the coronavirus pandemic. Moreover last week, the Fed said it would require big banks to suspend share repurchases during the third quarter, and limit third-quarter dividend distributions to the lower of either their second-quarter payout (dividends as a percentage of earnings) or their average payout from the four prior quarters. Dividends paid by Wells Fargo and Capital One had appeared to be higher than what the Fed would allow, based on net income over the past four quarters and how much extra capital they would be required to hold in order to weather an economic downturn. Capital One did not indicate on Monday whether its dividend would be cut as well. Meanwhile, Wells Fargo said that its allowance for credit losses in the second quarter is expected to increase by a substantially larger amount than the increase in the first quarter. “There remains great uncertainty in the path of the economic recovery,” Wells CEO Charlie Scharf said in a press release, “and though it’s difficult to accurately predict the ultimate impact on our credit portfolio, our economic assumptions have changed significantly since last quarter.” The Fed was said to have told banks to wait until Monday to report their capital plans for the third quarter and what capital buffer they would have to maintain as a result of the stress tests. Banks will be resubmitting longer-term capital plans in the coming months. The stress capital buffer is the difference between the bank’s capital level as the “severely adverse” scenario under the stress tests began and where it was projected to end up, taking into consideration what the banks planned to pay out in dividends. The lower the stress capital buffer, the better the bank is seen to have performed under the stress test, with the minimum being an 2.5% required to be held starting in October through September 2021. The Fed will finalize what buffers are required by Aug. 31.

Citigroup Has Made a Sap of the Fed: It’s Borrowing at 0.35 % from the Fed While Charging Struggling Consumers 27.4 % on Credit Cards - The first thing you need to know about Citibank and its parent, Citigroup, is that they have an extensive rap sheet. (See here). The second thing you need to know is that Citigroup is a serial predator that perpetually promises its regulators that it’s going to reform, but never does. The third thing you need to know is that Citigroup has made a sap out of the Federal Reserve – not once, but twice. During the last financial crisis of 2007 to 2010, Citigroupsomehow induced the Fed to secretly give it $2.5 trillion cumulatively in below-market rate loans for 2-1/2 years to prop up its sinking carcass. Citi got the cheap loans (often at below one-half of one percent) and then went right on charging its struggling credit card customers high double-digit interest rates.Citi played a major role in creating the financial crisis, according to the official report from the Financial Crisis Inquiry Commission (FCIC). Three of  Citigroup’s executiveswere referred by the FCIC to the Justice Department for potential criminal prosecutionbut zero criminal action was taken against them.Today, the Fed has quietly reimbursed Citibank $3.077 billion under its  Paycheck Protection Program Liquidity Facility, a program that reimburses banks for the loans they made under the CARES Act PPP program, which are guaranteed by the Small Business Administration. The Fed accepts the PPP loan as collateral and charges the bank a paltry interest on the loan of 0.35 percent.Is Citigroup using that insanely cheap money to help struggling consumers during the worst economic crisis since the Great Depression? Despite its grand promises to be a beacon of light during the pandemic, customers are spilling their guts to the Consumer Financial Protection Bureau’s complaint database with horror stories of what Citi has put them through during this crisis.  (Being able to report abuses by the Wall Street banks in a database shared with the public is one of the reasons that corporate-friendlyRepublicans in Congress are trying to kill the CFPB’s independence. The Trump administration has thus far gutted its funding and staff and the U.S. Supreme Court just handed down a decision on Monday indicating that the President has the power to fire its Director without cause.) We perused the database yesterday. Citibank had 452 complaints in just the month of June. Assuming that a small fraction of consumers know that the CFPB complaint database exists and will take the time to file a complaint, 452 complaints in a 30-day period strongly suggests a very large pattern and practice of abuse at Citibank. (Not to mention the rap sheet we linked to above.) If you think these complaints might be an aberration, we suggest you read our related articles on Citigroup’s past behavior below. The only real question is, why haven’t regulators shut this bank down?

Pack of regionals can satisfy stress tests with minimum buffer- A half-dozen regional banks on Tuesday reported needing only the minimum amount of extra capital to get through a severe economic downturn as modeled by the Federal Reserve stress tests completed last week. U.S. Bancorp, PNC Financial Services Group, Fifth Third Bancorp, Huntington Bancshares, KeyCorp and M&T Bank Corp. each announced needing a 2.5% stress capital buffer as part of their Dodd-Frank stress-test results. Truist Financial Corp. reported needing a 2.7% buffer, though the Charlotte, N.C.-based company said differences between its internal outcomes and the Fed’s could be caused by certain accounting treatments for the BB&T-SunTrust merger last year that created Truist. Regions Financial in Birmingham, Ala., said it needs a 3% stress capital buffer. The company said in its announcement that its proactive interest rate hedging program, which it began this year, “will provide substantial resilience” to its pretax pre-provision net revenue — a key metric used by the Fed in its stress testing this year. The stress capital buffer is the difference between a bank’s capital level as the “severely adverse” scenario under the stress tests began and where it was projected to end up, taking into consideration what the banks planned to pay out in dividends. The lower the stress capital buffer, the better the bank is seen to have performed under the stress test, with the minimum being 2.5% that must be held held starting in October through September 2021. By Aug. 31, the Fed will finalize what buffers are required for the 33 banks that underwent stress tests. Several big banking companies like Goldman Sachs, Morgan Stanley, Capital One and JPMorgan Chase reported needing higher buffers on Monday. The credit card company American Express on Tuesday reported a 2.5% stress capital buffer. A rival, Discover, on Monday reported needing a 3.5% buffer. All eight regional banks that reported Tuesday that they would be keeping their dividends steady. The Fed last week ordered banks to cap third-quarter dividends at second-quarter levels, though it said it could require even lower payouts in some cases depending on recent earnings history.

2Q preview- Regional banks staring at steep profit declines - Officially, new restrictions on paying shareholder dividends amid the pandemic only apply to 33 large banks. But industry analysts are now anticipating that the Federal Reserve Board’s recently imposed requirements — which temporarily cap dividend payouts based on recent profits — will effectively be extended to smaller regional and large community banks. “Generally there’s trickle-down regulation,” said Brian Kleinhanzl, an analyst at Keefe, Bruyette & Woods. He noted that the suspension of share buybacks that was first announced by eight big banks on March 15 has since spread to regional banks and even smaller institutions. Even if the Fed does not explicitly apply the new dividend restrictions to banks with less than $100 billion of assets, Kleinhanzl expects those companies to comprehend the central bank’s message. “I think it’s a subtle nudge,” he said. If more banks are eventually forced to cut their quarterly payouts to shareholders, it will be due to the toll the coronavirus recession is taking on bank profits. Many banks significantly boosted provisions for loan losses in the first and were expected to do the same for the second quarter in anticipation of a surge in loan defaults. Moreover, regional banks tend to be more dependent than the biggest banks on interest generated from loans, a component of earnings that is suffering amid the pandemic as a result of low interest rates. Midsize banks are expected to feel the earnings pain even more acutely than their larger peers because they don’t have large capital markets businesses to help offset declines in interest income, Scott Siefers, an analyst at Piper Sandler, said in an interview. “We should see some bifurcation in performance,” he said. So far, Wells Fargo is the only U.S. bank to announce plans to reduce its dividend in the third quarter. But KBW is forecasting that the $59 billion-asset CIT Group, which is not among the nearly three-dozen large banks recently stress-tested by the Fed, may also have to cut its dividend. Estimated dividends to be paid by New York-based CIT Group in the second quarter amount to 141% of the firm’s average net income over the four previous quarters, according to a KBW calculation.That’s well in excess of the 100% bar established by the Fed for banks that were stress-tested. If the Fed’s restrictions remain in effect for the fourth quarter of 2020, dividends paid to shareholders at four other regional banks may also have to be cut, according to KBW analysts. That group includes Citizens Financial Group in Providence, R.I., Huntington Bancshares in Columbus, Ohio, and KeyCorp in Cleveland, all of which were stress-tested by the Fed, and Dallas-based Comerica, which was not. The $177 billion-asset Citizens, the $113.8 billion-asset Huntington and the $155 billion-asset Key have all vowed to maintain their dividends in the third quarter, but they haven’t commented on what may happen beyond that point.

Where FDIC, OCC chiefs differ on post-pandemic banking— Two banking agency heads weighed in Friday on how to increase financial inclusion, illuminating key differences in how they may approach challenges left in the wake of the coronavirus pandemic. The panel, featuring Federal Deposit Insurance Corp. Chairman Jelena McWilliams, acting Comptroller of the Currency Brian Brooks and hosted by Financial Health Network CEO Jennifer Tescher, focused on the question of how financial regulatory policy might — or might not — help shore up Americans' financial well-being once the pandemic subsides. “The one-two punch of the pandemic and the resulting financial fallout has created significant uncertainty about the overall health of the economy, especially since we just don't have a good sense yet of how long it will take us to get back to quote-unquote, ‘normal,’” Tescher said as she introduced the panelists.Given the strength of the economic shock and the number of temporary government relief measures, such as bolstered unemployment benefits, that could expire as soon as next month, “this really is creating a perfect storm, certainly for consumers and potentially for the banks that serve them,” Tescher said. In the early days of the pandemic, U.S. financial regulators had a loud-and-clear message for their supervised banks: Sit down with impacted customers and make it work, whether that means deploying temporary forbearance measures, restructuring loans, or even emphasizing small dollar lending. Five months into the pandemic, that is still the approach being taken by both the FDIC and OCC. But the remarks of McWilliams and Brooks revealed significant differences in their oulooks.Asked how the FDIC is advising its banks to weather the possibility of a perfect economic storm, McWilliams pointed to the agency’s early steps to grant relief to both consumers and banks.“Early on, we had issued a statement encouraging banks to proactively modify these loans — to go out and call their customers. Literally, we said, call your small-business customers, call your individual customers [and ask]: Did you lose a job?” McWilliams said. McWilliams did not weigh in on the overall health of the economy during the panel. But she emphasized that the FDIC will continue to encourage relief to borrowers as long as the pandemic remains a factor in American public life. “How long are we willing to go? However long is necessary,” McWilliams said. “We will do what it takes to make sure that the consumers are not disproportionately impacted above and beyond, already, the shock to the economy that they're experiencing with the loss of wages.” Brooks said he would echo McWilliams’ remarks on regulatory relief. But he also struck an optimistic tone about the economic outlook for the country, suggesting that he is hopeful that emergency relief measures will not need to remain in place for too much longer. “The economic impact of the last three months, I’d emphasize, was human-caused,” Brooks said. “We were confronting an unknown disease of unknown magnitude. And so  we made the collective decision to turn off the economy.” Today, Brooks said, policymakers have a much clearer idea what the health risks of the disease are. “And thus we've, in many states, narrowed the scope of those orders and had more targeted responses with the result that the economic data now looks very, very positive if it can be sustained.” “I think the issue for consumers is, can we get to a place where the economy's turned back on?” Brooks continued. “If we can, then I think the need for these extraordinary interventions will over time go away. And if not, then they won't.”

Money-Market Shifts Are Bad News for Profit-Starved Global Banks – WSJ - Last week, Fidelity Investments said it would close two institutional prime money-market funds with a total of around $14 billion in net assets. That’s an ominous portent for some non-U.S. banks, which have increasingly come to rely on such funds to raise dollars they can’t easily acquire at home. Fidelity cited volatile outflows from the funds—which invest in short-term commercial paper and certificates of deposit issued by companies—and into government money-market funds during moments of market stress. Fidelity’s retail prime money-market funds, whose assets run into the hundreds of billions, will remain open. But non-U.S. banks will feel the loss: 20% of the Prime Reserves Portfolio, the larger of the two funds being closed, is invested in certificates of deposit, all issued by Canadian, Japanese and European banks. Many have increasingly strayed into dollar-denominated lending in recent years. Low as the returns are, they’re better than what they could earn at home. In Japan in particular, the spread between short- and long-term yen-denominated interest rates has been squeezed narrower and narrower over time, making dollar lending far more profitable. To fund that longer-term lending—in the absence of dollar deposits—foreign banks have used short-term CDs. The closures don’t mean an imminent funding crunch. But they are still bad news for the banks, watching one of their limited avenues for profit in recent years slowly closed off. Certificates of deposit simply may not be an attractive investment in a lower-for-longer interest-rate environment like today’s. Investors will always look for incremental additional returns, but for much of 2014, when conditions were similar, 3-month CDs offered a yield less than 0.1 percentage point higher than U.S. Treasury bills of the same maturity. That’s measly compensation for an asset class that carries at least some credit risk. The spread surged beyond 2 percentage points during the most panicked days of March, but is now again below 0.1 percentage point, somewhat lower than for most of the past few years.

June 2020: Unofficial Problem Bank list Decreased to 64 Institutions - The FDIC's official problem bank list is comprised of banks with a CAMELS rating of 4 or 5, and the list is not made public (just the number of banks and assets every quarter). Note: Bank CAMELS ratings are also not made public.CAMELS is the FDIC rating system, and stands for Capital adequacy, Asset quality, Management, Earnings, Liquidity and Sensitivity to market risk. The scale is from 1 to 5, with 1 being the strongest.As a substitute for the CAMELS ratings, surferdude808 is using publicly announced formal enforcement actions, and also media reports and company announcements that suggest to us an enforcement action is likely, to compile a list of possible problem banks in the public interest.Here is the unofficial problem bank list for June 2020.Here are the monthly changes and a few comments from surferdude808:  During the month, the list dropped by one to 64 institutions after three removals and two additions. Assets increased by $3.9 billion to $52.4 billion, with all of the increase centered in updated quarterly financials that added $4.2 billion. A year ago, the list held 73 institutions with assets of $55.0 billion. Added this month was The Fowler State Bank, Fowler, KS ($81 million) and Towanda State Bank, Towanda, KS ($11 million). Removals through merger included KEB Hana Bank USA, National Association, Fort Lee, NJ ($243 million); Ben Franklin Bank of Illinois, Arlington Heights, IL ($97 million); and First Citizens Bank of Polson, National Association, Polson, MT ($17 million), which made its appearance on the first list we published way back in 2009. This month the OCC did not release a public update on its enforcement action activity. Usually, the OCC releases an update on the first Thursday after the 15th of a month. The last update from the OCC was on May 21st. The FDIC provided first quarter results and an update on the Official Problem Bank List on June 16th. In that release, the FDIC said there were 54 institutions with assets of $44.5 billion on the official list.  With the conclusion of the second quarter, we bring an updated transition matrix to detail how banks are transitioning off the Unofficial Problem Bank List:

FDIC Considers Scrapping Quarterly Bank Reports – WSJ - The Federal Deposit Insurance Corp. is moving to boost the way it monitors for risks at thousands of U.S. banks, potentially scrapping quarterly reports that have been a fixture of oversight for more than 150 years yet often contain stale data. The FDIC on Monday is expected to kick off a competition among 20 data and technology firms to develop a new reporting prototype that could provide the agency with more timely and targeted data about banks’ credit exposures and deposit information. The move is focused primarily around modernizing the data the FDIC collects from more than 3,200 community banks the agency oversees. Eventually, the new system might displace the voluminous “call” reports the firms are required to file 30 days after each quarter, which run 60 pages and contain more than 2,200 data fields. “What we would like to do is frankly make the call reports obsolete, and not because we wouldn’t have the data but because we would have better data and we would have more timely data,” FDIC Chairman Jelena McWilliams said in an interview. The competition is part of a broader push to modernize the way government watchdogs surveil risks in the market. Proponents say it could also boost consumer protection, help combat financial crime and ensure the banking system serves an inclusive set of customers. “These kinds of efforts are going to transform financial regulation,” said Jo Ann Barefoot, a former banking regulator who now heads the Alliance for Innovative Regulation. “They can’t see most of what’s going on in the financial system in real time, because they don’t have good enough data.” The effort to modernize the FDIC’s systems predates the coronavirus pandemic, yet the outbreak has demonstrated bank reporting can be out of date. For instance, the agency wasn’t able to brief the public on the first-quarter health of the industry until earlier this month. And that briefing didn’t include data past March, relatively early in the pandemic-triggered downturn. Though the agency collects some daily data from the largest U.S. banks, officials say keeping tabs on smaller institutions is especially cumbersome and outmoded, comparing the quarterly call reports to seeing a doctor but having to wait four months for lab work. The FDIC’s goal is to develop a system that would allow the agency to see targeted sets of data on, say, commercial-real-estate loans, on a more continuous basis. The agency declined to identify the firms that have been approached to develop the new tool.

FDIC chief on why call reports are getting a makeover By Jelena McWilliams - More than 150 years ago, Congress mandated that banks provide quarterly reports to supervisors on the financial health of the banking industry. When I began serving as FDIC chairman two years ago, we charted an ambitious course for the development of new technological solutions both at the agency and across the banks we supervise. This agenda includes making these “call reports” obsolete. Why, one may ask, would a bank regulator want to get rid of quarterly data collection? Because there has to be a better way. Here is the issue: On June 16, we reported on the health of over 5,000 FDIC-insured financial institutions at the end of the first quarter. The quarter was challenging for banks, but the economic impact of the coronavirus pandemic would continue into the second quarter. Second quarter results for the vast majority of banks will not come in until the end of July — 120 days after the quarter began. If you were a doctor trying to assess a patient’s health, it would be preposterous to get the lab results four months later. The information gap is particularly acute at community banks. For our largest banks, the FDIC uses technology to fill the gap between call reports with robust, granular data feeds on liquidity, security exposures and asset quality. This depth of reporting is not necessary for community banks that individually represent little to no systemic risk. Nevertheless, financial conditions across all community banks can be key indicators of strain in the economy, growing stress across the financial system and emerging risk at individual institutions. This presents a key challenge for regulators: How to promote more regular reporting from community banks — where technology levels vary greatly — without increasing reporting burdens or costs. To help answer this question, the FDIC recently invited some of the most advanced technology companies and several core processors that support the financial services industry to participate in a rapid prototyping competition. Similar to an extended tech sprint or “hackathon,” this event will challenge the competitors to develop a new approach to financial reporting. The supervisory technology that the competing teams will develop will be the initial step in a long journey to eliminate call reports. Targeted data sets from community banks, more frequently available and more granular than current reporting, could reduce the need for cumbersome quarterly reporting. This modernized and automated data system would improve the ability of supervisors to identify bank-specific and systemwide risks sooner and more efficiently, while reducing the compliance burdens on individual institutions. More timely and targeted data would also promote early supervisory engagement with banks when risks are identified. And these advance warnings would allow banks to take remedial action before issues become irreparable. The lessons learned from this competition, and future FDIC tech sprints, will promote the safe and sound adoption of these technologies, helping banks and supporting consumers in the process. This reporting system will not come with mandates for community banks to adopt it. Until this new framework becomes operational, call reports will continue to be an important supervisory tool. As the FDIC works to facilitate and expedite the digital transformation at community banks, we will maintain the public transparency and security that call report information provides. This transformation will not happen overnight — it may not even happen during my FDIC tenure. But it is critical for our banking system to begin the process now. The future is past due, and the FDIC is lighting the fuse on innovation today.

Supreme Court won't hear bankers' appeal in credit union membership suit -- The U.S. Supreme Court on Monday denied the American Bankers Association’s request for an appeal in its lawsuit against the National Credit Union Administration, effectively ending the bankers’ challenge to the regulator’s field-of-membership rule.The NCUA board updated that rule in the fall of 2016, including provisions that would allow credit unions to broadly expand their membership across wide geographic areas. Banks suedthe agency in December, claiming four provisions of that rule violated the Federal Credit Union Act. In March 2018, a judge struck down two parts of the rule, but the NCUA and the ABA both appealed, with a court ultimately upholding most of NCUA’s original rule.That decision compelled the NCUA to revise part of the rule as it combated charges of allowing credit unions to engage in redlining, but bankers still moved ahead with an appeal, first to the full appeals court and ultimately to the Supreme Court. If the court had elected to hear the case, it would have been the credit union industry’s first Supreme Court case since the late 1990s, when the court ruled in favor of banks challenging a credit union expansion effort. That defeat led to the passage of HR 1151, the Credit Union Membership Access Act of 1998, which laid the groundwork for multiple common-bond membership and kick-started much of the growth the industry has seen over the last two decades.“Today’s decision by the Supreme Court ends nearly four years of uncertainty and will help the NCUA in its efforts to foster greater financial inclusion for all Americans," NCUA Chairman Rodney Hood said in a statement. "The NCUA will begin processing field-of-membership applications affected by this decision immediately.”The court’s decision Monday not to consider the field-of-membership case is likely to be the end of the lawsuit. Not surprisingly, credit union groups were ecstatic about the court’s decision.“Today is a great day for anyone hoping to access the financial well-being afforded by credit unions,” Jim Nussle, president and CEO of the Credit Union National Association, said in a press release. “In denying the bankers’ lawsuit, the court has established credit unions’ mission and structure as part the fabric of America. In recognizing the NCUA’s right to oversee our system, the court has also established a much-needed firewall from spurious attacks by the bankers.” 

Has the U.S. Attorney’s Office in Manhattan Been Outsourced to Wall Street’s Law Firms? -  Pam Martens - On May 2 of last year, the Chief Judge for the U.S. District Court for the Southern District of New York wrote a decision finding that the U.S. Department of Justice had outsourced a criminal investigation to the target of the investigation – Deutsche Bank – and Deutsche Bank’s outside law firm, Paul, Weiss, Rifkind, Wharton & Garrison. (Paul Weiss is a big defender of alleged crimes by Wall Street banks, particularly those of Citigroup.)A larger, more critically important question would be: has the U.S. Department of Justice outsourced the entire U.S. Attorney’s Office for the Southern District of New York to Wall Street’s favorite law firms?No matter how many times the New York Times tells its readers that the U.S. Attorney’s office in the Southern District of New York is known for its “independence,” the cold, hard facts on the ground keep getting in the way of that narrative.The fact that Jay Clayton, Trump’s golfing buddy and his sitting Chair of the Securities and Exchange Commission, felt comfortable to ask Trump and Attorney General William Barr for the job of U.S. Attorney in the SDNY while the post was already occupied by Geoffrey Berman, says a lot about how things are done in that U.S. Attorney’s office.Both Clayton and Berman came from Big Law firms that defend Wall Street’s biggest banks. Clayton had worked for Sullivan & Cromwell for two decades prior to Trump’s nomination for him to head the SEC. Clayton has spent much of his time at the SEC rolling back the safety protections of the Dodd-Frank financial reform legislation of 2010 to the cheers of his former law partners at Sullivan & Cromwell and their Wall Street banking clients. While at Sullivan & Cromwell, Clayton had been outside counsel to Goldman Sachs. Goldman Sachs is currently attempting to get out of pleading guilty to a felony in a bribery and embezzlement case known as 1MDB being handled by the U.S. Department of Justice – of which the U.S. Attorney’s office is a part. It might be soothing for Goldman Sachs to have their former lawyer sitting as a federal prosecutor while they navigate their way out of another criminal matter without being prosecuted.

Wall Street Journal’s Apologia for Private Equity Letting Companies Go Bust -  Yves Smith - As more and more private equity-owned companies are failing, the great unwashed public is starting to take notice and wonder why. Even before the coronacrisis arrived, the mainstream media was documenting the outsized role of private equity in the bankruptcies of retailers, restaurants, and even stores like Fairway. Sometimes, as with Toys’R’Us, it was too much leverage exacting a toll. In others, it was asset-stripping that increased operating leverage, specifically selling company-owned real estate at inflated priced because it was being leased back at high rent rates.  The Wall Street Journal sets forth some of the reasons why private equity fund managers like Apollo, Blackstone, and KKR don’t ride in to the rescue when companies they have acquired go wobbly.  Not only are the points the Journal makes not entirely accurate, they also manage to skip over the most relevant reasons. And in doing so, they whitewash private equity conduct. The Journal tries to explain the conundrum of the private equity industry collectively having access to $1.45 trillion of “dry powder,” meaning yet-to-be-deployed investor committed capital, yet standing pat as companies in their funds fail due to coronacrisis revenue hits:  Thirty-four U.S. private-equity-backed companies filed for bankruptcy from March 1 through June 14, according to data provider PitchBook Inc., including well-known names such as Hertz Global Holdings Inc., Neiman Marcus Group Inc. and J.Crew Group Inc. The private-equity owners of some bankrupt companies had no shortage of cash to spend. Ares Management Corp., which bought Neiman Marcus in 2013 alongside the Canada Pension Plan Investment Board, was sitting on more than $33 billion of dry powder shortly before the luxury retailer filed for bankruptcy last month. Ares declined to comment, and the CPPIB didn’t respond to a request for comment.  The big justification for this disconnect is the “going bust” companies are in older funds, while money waiting to be spent is in newer funds, and they allegedly can’t use the new fund money on older deals:  This excuse is bogus. Private equity limited partnership agreements often contemplate that the fund manager (the general partner) may be allocating an investment in a particular portfolio company among several funds, which needless to say would seem to represent a conflict of interest. The limited partnership agreement provides for the general partner considering interests other than those of the limited partners in its fund in making those decisions….including its own interest!

The tell: corporate reactions to short-sellers - Activist short-selling is a funny term when you really think about it. Unlike activistinvestor campaigns when someone takes a stake in a business, the short-selling speculator has no direct economic means to influence the company. It’s hard, after all, to ask for say, a board seat, or a new chief executive, if you don’t own any shares.(Although Chris Hohn of TCI has tried to change this pattern of late. Whether his intervention actually changed anything is up for debate. But that’s another story.) In fact, the economic relationship is almost the total opposite. The short-seller is relinquishing her economic power with the hope of buying back the shares back at a later date at a lower price. Activists aim to do so not by influencing the company but influencing the the market perception of the company. One of the ways they do this is via a lengthy research document colloquially known as a “short report”. And perhaps, if they’re lucky, some media coverage.While much academic ink has been spilled on the the efficacy of activist short selling -- i.e. how share prices react to short reports -- little attention has been dedicated to the corporate response. Which, as you may know, can range from the silent treatment -- as is the case with Muddy Waters’ report on digital health insurance broker eHealth -- to the aggressive, like it was with a certain insolvent German payments company.A new paper by Janja Brendel of Humboldt-Universität zu Berlin and James Ryans of London Business School seeks to rectify that.The two academics studied corporate responses to 351 short-reports published on US-listed companies between 1996 to 2018 in an attempt to discover if a company’s reaction is as important as the market’s when a report is released.There are lots of good tidbits in the paper which caught our attention. For instance, companies have responded to just under one-third of activist short-sellers in the past -- the rest giving the silent treatment. And perhaps, of greater surprise, despite feeling like there’s a short report published every week at the moment -- on average only 35 reports were published a year between 2010 to 2018. (In the prior period it was a meagre 2.5 reports per annum, which does demonstrate the practice’s increasing popularity.) However we think the biggest takeaway from the paper is this: beware companies that launch internal investigations in response to a short-sellers’ allegations. Particularly if the investigation is launched by the board of directors.

New Investment Gimmickry: Covid-19 Bonds - - Yves Smith -When the Financial Times decides to diss a new investment scheme, you know it’s bad. The headline of interest: Rise in Covid-19 bond issuance fans fears over ‘social washing’. The short version is that opportunists, um, issuers, are taking advantage of the fad among big investors for “environmental, social, and governance” (ESG) oriented investing with the new wrinkle of profiting from the coronacrisis via Covid-19 bonds. Of course, the perps, um, proponents, would beg to differ, arguing that these Covid-19 bonds help fund noble initiatives. But if they are so noble, why do they need a (presumed modest) break on borrowing costs? Why not do it on a straight up charitable basis? Or throw one’s political/lobbying weight behind new government programs?  I’ve long been skeptical of ESG when an old friend who’d just launched a supposedly better program for scoring companies on ESG performance insisted the press was all wrong on the BP Deepwater Horizon disaster because his metrics said BP was an excellent corporate citizen. And I’ve become even more skeptical when I’ve seen it at work at CalPERS. The ESG consultants speak in bafflegab that would put any hedgie or derivative salesman to shame. And ESG is a way for investment-illiterate board members (pretty much all of them) to think they are contributing. The Covid-19 bonds are sold with often terribly vague promises about Doing Something. From the pink paper:Since the coronavirus pandemic upended global markets, companies and governments have issued tens of billions of dollars worth of special bonds, including about €60bn in March and April alone, according to Axa Investment Managers.Many were classed as social bonds — part of a distinct market based on environmental, social and governance principles — while others have been billed as conventional bonds intended to fund spending programmes or strengthen balance sheets during the crisis…  Consistent with our observation that Covid-19 had dented interest in the Green New Deal, floatations of “green bonds” have fallen in 2020 while sales of “social bonds” rose. But even rating agencies aren’t keen about what they see: New York-based S&P Global warned this month about social washing, drawing a parallel to allegations of “green washing” that have dogged many issuers of notionally green bonds in recent years. “[Social] benefits are often more qualitative than quantitative,” said Lori Shapiro, a sustainable finance analyst at the rating agency….

Will CFPB advisory opinions offer clarity, or give companies a pass?  -Companies have long urged the Consumer Financial Protection Bureau to issue rulings on whether a practice complies with federal rules. But the agency's plan for providing such clarity is raising its own questions. Industry representatives are hailing a proposal allowing firms to seek CFPB advisory opinions on specific regulatory questions. They say companies need official clarification without forcing the bureau to issue another rulemaking. But consumer advocates and Democratic lawmakers worry the advisory opinions — issued upon request to specific firms but published for all to see — would circumvent formal rulemakings and a public comment period. “If the law is that ambiguous they should do a rulemaking to adjust regulations through the public process," said Lauren Saunders, an associate director at the National Consumer Law Center. CFPB Director Kathy Kraninger in June sided with the industry's desire for a more formal advisory opinion process, proposing steps for companies to seek legal interpretations. The CFPB also announced that the agency would begin accepting such requests through a pilot program. Under the proposal, if the agency issues an advisory opinion it will be published in the Federal Register. “One of the criticisms of the agency is that it hasn’t put out enough guidance to provide clear rules of the road,” said Brian Johnson, a partner at Alston & Bird and the CFPB’s former deputy director. “This is a way for the biggest areas of ambiguity to be resolved for everybody.” But some critics are dead set against the plan, arguing that it could be used to favor companies and roll back regulations by reinterpreting existing laws without a formal rulemaking. They say advisory opinions can have legal significance by providing a safe harbor to companies that could allow them to evade consumer protection responsibilities. “Piecemeal, company-by-company interpretations just end up with a lot of confusion,” said Saunders. "The intent should not be to relieve companies of the obligation to comply with the law rather than ensure they comply.” While he was still at the agency, Johnson said in November that the bureau was considering a process for companies to seek an opinion on the legality of new products before they are offered to consumers. But the next month, Sens. Elizabeth Warren, D-Mass., and Sherrod Brown, D-Ohio, sent a letter to Kraninger stating that while agency guidance may be appropriate in some situations, it should be “broadly applicable to industry” and not tailored to provide immunity from consumer protection or anti-discrimination laws. “We have serious concerns that issuing advisory opinions tailored to companies' specific circumstances is not appropriate, especially if companies could use these opinions to circumvent consumer financial laws or as a defense in litigation by the Bureau or other parties,” the senators wrote.

Supreme Court strikes down CFPB leadership structure - The Supreme Court ruled on Monday that the single-director structure of the Consumer Financial Protection Bureau is unconstitutional, but stopped short of disbanding the agency altogether or invalidating the Dodd-Frank Act that created it. In a split 5-4 decision written by Chief Justice John Roberts, the high court found that the agency's structure vests too much power in the hands of one person, and that the president has broad authority to appoint and remove agency heads. The ruling, which gives a sitting president the ability to fire a CFPB director without cause, has far-reaching implications for other independent agencies with single-director structures such as the Federal Housing Finance Agency. "The CFPB’s single-Director structure contravenes this carefully calibrated system by vesting significant governmental power in the hands of a single individual who is neither elected by the people nor meaningfully controlled (through the threat of removal) by someone who is," Roberts wrote. The ruling eliminates the so-called “for cause” provision in Dodd-Frank but keeps the rest of the law and the agency intact. There is no impact on its past nine years of rulemakings, decisions and enforcement actions. Roberts wrote: "The CFPB’s structure has no foothold in history or tradition. We therefore hold that the structure of the CFPB violates the separation of powers. We go on to hold that the CFPB Director’s removal protection is severable from the other statutory provisions bearing on the CFPB’s authority. The agency may therefore continue to operate, but its Director, in light of our decision, must be removable by the President at will." The ruling could have far-reaching implications for dozens of agencies including the FHFA. It also means that CFPB Director Kathy Kraninger can be fired at any time by the president. The high court’s decision could also shine a new light on agencies overseen by boards or commissions that are structured with some measure of independence from the president, particularly the Federal Reserve, whose members are appointed to 14-year terms and are not removable by the president except for cause.

Supreme Court Orders Restructuring of Consumer-Finance Watchdog – WSJ —The Supreme Court ordered changes to a government consumer-finance watchdog created in the wake of the 2008 financial crisis, capping a 10-year battle over the agency by ruling its structure was unconstitutional because the director held too much unchecked power. To address the problem, the court held that the president can remove the director of the Consumer Financial Protection Bureau for any reason. The court rejected broader legal arguments that it should strike down the bureau—which was designed to protect consumers from abusive financial-industry practices on products like mortgages, student loans and credit cards—altogether. The CFPB has been politically polarizing since its inception, when President Obama tapped then-Harvard law professor Elizabeth Warren to set it up. Democrats have wanted a muscular CFPB to take on what they saw as financial-industry excesses. Republicans and Wall Street have criticized the bureau as an instrument of runaway government regulation, with too much power over a significant slice of the economy. In a 5-4 ruling along ideological lines, the court said Congress overstepped constitutional boundaries in 2010 when it created the CFPB and placed it under the control of a single director who was insulated from the White House’s political direction. Lawmakers, attempting to give the bureau a buffer from political influence, said the director could only be removed by the president for “inefficiency, neglect of duty, or malfeasance in office.” But the court, in an opinion by Chief Justice John Roberts, said the setup meant the CFPB’s director was unaccountable to the executive branch, creating an unconstitutional reduction of presidential power. “The CFPB’s single-director structure contravenes this carefully calibrated system by vesting significant governmental power in the hands of a single individual accountable to no one,” the chief justice wrote, joined by Justices Clarence Thomas, Samuel Alito, Neil Gorsuch and Brett Kavanaugh. As a remedy, Chief Justice Roberts said it was enough to give the president the freedom to fire the director at will. While Congress preferred an independent CFPB, the court said lawmakers likely would have preferred a dependent CFPB to no agency at all. Throwing out the bureau entirely “would trigger a major regulatory disruption and would leave appreciable damage to Congress’s work in the consumer-finance arena,” the chief justice wrote.

After ruling, stage set for new battles over CFPB's future - — The Supreme Court’s decision that the head of the Consumer Financial Protection Bureau can be fired at will answered a key question about the agency's leadership structure. But like much of the agency's tumultuous nine-year history, a lot is still unresolved. While the ruling ends years of litigation against the agency, observers said it could result in even more intense political jockeying to control the bureau, legal questions about new CFPB enforcement actions and rulemaking, a legislative effort to change the leadership structure, and a brighter spotlight on other agencies with single directors. The outcome of Seila Law v. CFPB will further exacerbate "the political influence that has already plagued the bureau," said Richard Hunt, president and CEO of the Consumer Bankers Association. The ruling, he added, "subjects consumers and the financial services industry to potentially radical regulatory shifts with each administration." "It is inconceivable that Congress, which wanted to shield the Bureau from political vagaries, would have approved that result," Hunt said. In the 5-4 decision Monday written by Chief Justice John Roberts, the court found that the agency's structure vests too much power in the hands of one person. Roberts wrote that the president can remove the single director of the CFPB for any reason, striking the so-called “for cause” provision from the Dodd-Frank Act. The CFPB structure places "significant governmental power in the hands of a single individual who is neither elected by the people nor meaningfully controlled (through the threat of removal) by someone who is," Roberts wrote. Yet the high court did not disband the CFPB or invalidate Dodd-Frank, so there is no impact on the agency’s past nine years of rulemakings, decisions and enforcement actions. But the ruling calls into question another high-profile regulator with a single-director structure — the Federal Housing Finance Agency — as it charts a new future of Fannie Mae and Freddie Mac. The FHFA's "single-Director structure is a source of ongoing controversy," Roberts wrote in the court's ruling. Still, many saw the ruling as paving the way for the CFPB to focus on its mission, putting to rest years of litigation looming questions about the constitutionality of the agency. The agency's current director, who had supported the challenge of CFPB structure, hailed the decision. “Today’s Supreme Court decision finally brings certainty to the operations of the bureau,” Director Kathy Kraninger wrote on Twitter. “We will continue with our important mission of protecting consumers with no question that we are fully accountable to the president. Consumers and market participants should understand the same rules continue to govern the consumer financial marketplace.” Former CFPB Director Richard Cordray agreed, saying the decision clarifies the leadership issue while making clear that the bureau can continue to exist. “In some ways it’s a green light to move ahead,” Cordray said. “Roberts was pretty clear that the only effect is to sever the ‘for cause’ provision.” But following the decision, many suggested Congress will renew efforts to overhaul the agency's structure, creating a multi-member commission headed by the director. Adding that layer of oversight is seen as a way to remove concerns about the single-director structure while protecting the director from presidential firings. Such legislation, however, faces an uphill battle in a divided Congress. “We still believe that Congress has an opportunity to strengthen the CFPB over the long term by converting the Bureau into a five-member, bipartisan commission,” said Rob Nichols, president and CEO of the American Bankers Association.

CFPB political appointee to be named agency's No. 2: Sources - Tom Pahl, a Republican political appointee at the Consumer Financial Protection Bureau who has led key rulemaking efforts at the agency, will be named its deputy director, sources said. Pahl, a former longtime regulator at the Federal Trade Commission, has served for two years as the bureau’s policy associate director for research, markets and regulations. The political position was created in 2017 by former acting CFPB Director Mick Mulvaney, who staffed the agency with several political appointees. Pahl would succeed Brian Johnson as the CFPB's No. 2 official under Director Kathy Kraninger. Johnson left the bureau in early March to become a partner at Alston & Bird. Leonard Chanin, the deputy to Federal Deposit Insurance Corp. Chair Jelena McWilliams, had served briefly on a part-time basis as the CFPB’s acting deputy director. But he ended his tenure at the CFPB last month and has returned full time to the FDIC, sources said. As deputy director, Pahl would become a civil servant instead of a political appointee. He is in his second stint at the CFPB after having previously worked for nearly four years as managing counsel in the agency’s office of regulations under former CFPB Director Richard Cordray. Pahl spent more than two decades at the Federal Trade Commission. Before rejoining the CFPB, Pahl was appointed in 2017 as acting director of the FTC’s bureau of consumer protection. He also has been a partner at the law firm of Arnall Golden Gregory LLP.

Wary outlook for loan growth after PPP boost - A word of caution about any second-quarter loan growth banks report: Take it with a grain of salt. While some banks could hold more loans at midyear, much of the new volume will likely be tied to the Paycheck Protection Program, which was designed as short-term assistance for small businesses hurt by the coronavirus pandemic. There is also a good chance many banks will report lower loan balances, even with the help of PPP originations. Total loans at banks fell by 1.5% during the first half of June, according to data compiled by the Federal Reserve. “It’s just a very hard environment to see [what borrower] is going to be a good credit and who’s going to be a challenge,” said Jon Winick, CEO of Clark Street Capital in Chicago. “It’s going to be very difficult to develop new business.” As a result, banks will be pressured to sharpen their focus on niche lending, businesses such as mortgage refinancing that bring in fees, and expense management. Those topics are expected to come up frequently as banks host their second-quarter conference calls. To be sure, the Paycheck program will be a bright spot when banks report second-quarter results. Banks made more than $500 billion in PPP loans during the second quarter, based on Small Business Administration data. But with the program winding down, those loans will start to roll off banks’ books. They will be hard to replace. “We suspect organic loan growth … will remain muted,” the research team at Piper Sandler said in a recent note to clients. They pointed to “lower demand in general” tied to a sluggish economy hampered by the pandemic. “While there are pockets of opportunistic growth within our coverage universe, we suspect material loan growth will be challenging in the quarters ahead,” the Piper Sandler team added. “There is still a lot of uncertainty in the outlook,” said Scott Brown, Raymond James’ chief economist. While there was some recovery in May as states began to reopen their economies, the “improvement after the initial rebound will slow, barring a vaccine or effective treatment for COVID-19,” Brown said. “Significant challenges” will exist for the rest of the year and “risks remain weighted predominantly to the downside,” Brown said. Since heavily populated states such as California, Florida and Texas have already paused their reopening plans, more economic contraction is possible, he said. Those pauses could harm loan demand and shrink an already shallow pool of creditworthy borrowers, industry observers said. Some banks hope to deepen ties to customers obtained through the PPP, while others are scouring for industries that may recover faster than others.

‘Flying Blind Into a Credit Storm’: Widespread Deferrals Mean Banks Can’t Tell Who’s Creditworthy – WSJ - Banks have pulled back sharply on lending to U.S. consumers during the coronavirus crisis. One reason: They can’t tell who is creditworthy anymore. Millions of Americans are out of work and behind on their debts. But, in many cases, the missed payments aren’t reflected in their credit scores, nor are they uniformly recorded on borrowers’ credit reports.The confusion stems from a provision in the government’s coronavirus stimulus package. The law says lenders that allow borrowers to defer their debt payments can’t report these payments as late to credit-reporting companies. From March 1 through the end of May,Americans deferred debt payments on more than 100 million accounts, according to credit-reporting firm TransUnion, TRU +1.23% a sign of widespread financial distress.The credit blind spot has further clouded the outlook for lenders. For years, strong consumer spending and borrowing helped propel them to record profits. Now the economy is in shambles, and they are trying to figure out what is going to happen to all of the debt Americans racked up in better times.Lenders that are having a tough time spotting risky loan applicants are approving fewer borrowers for credit cards, auto loans and other consumer debt. They are also hunting for new data sets that could indicate who is in financial trouble and how much they need to set aside to cover soured loans. The Federal Reserve last week said the biggest U.S. banks could be saddled with as much as $700 billion in loan losses in a prolonged downturn.“Without accurate information, their only option is to pull back on credit,” said Michael Abbott, head of banking for North America at consulting firm Accenture PLC. “Banks don’t know who is going to pay and who isn’t. It’s like flying blind into a credit storm.” Banks started tightening their underwriting standards in March, when the first wave of coronavirus layoffs began. By early April, 33% of banks that responded to the Federal Reserve’s senior loan officer survey said they had increased their minimum credit-score requirements for credit cards over the previous three months, up from 14% in January. Bank respondents tightened lending standards for all consumer-loan categories tracked by the survey.Loan originations have fallen, a result both of the tightening and a decline in consumer demand. An estimated 79,000 personal loans were extended in the week ended May 10, compared with 226,000 in the week ended March 22, according to Equifax Inc. EFX -0.07% Auto loan and lease originations fell to 266,000 from 390,000 during the same period. General-purpose credit-card originations totaled 483,000, down from 856,000. In 2019, weekly card originations rarely fell below 1.2 million.

WSJ Says Banks Can’t Determine Who Is Credit-Worthy: More COVID-19 Fallout - Jerri-Lynn Scofield - The Wall Street Journal ran a story this morning about a problem confronting banks: the COVID-19 pandemic has made it difficult  to decide who remains credit-worthy and who not,.‘Flying Blind Into a Credit Storm’: Widespread Deferrals Mean Banks Can’t Tell Who’s Creditworthy  As regular readers know, banks have been profligate in awarding credit before any of us had even heard of COVID-19. But in this game of credit musical chairs, the music has stopped, and an unknown number of chairs have beeen yanked away. The models banks used to allocate credit when the game began can no longer predict who will find a seat. (I leave aside the broader question of whether they ever could do so accurately.) Over to the WSJ: Banks have pulled back sharply on lending to U.S. consumers during the coronavirus crisis. One reason: They can’t tell who is creditworthy anymore. Millions of Americans are out of work and behind on their debts. But, in many cases, the missed payments aren’t reflected in their credit scores, nor are they uniformly recorded on borrowers’ credit reports. The confusion stems from a provision in the government’s coronavirus stimulus package. The law says lenders that allow borrowers to defer their debt payments can’t report these payments as late to credit-reporting companies. From March 1 through the end of May, Americans deferred debt payments on more than 100 million accounts, according to credit-reporting firm TransUnion, a sign of widespread financial distress. The credit blind spot has further clouded the outlook for lenders. For years, strong consumer spending and borrowing helped propel them to record profits. Now the economy is in shambles, and they are trying to figure out what is going to happen to all of the debt Americans racked up in better times I know, I know: Cry me a river. The banking industry usually enjoys close control over our Congresscritters. Seems, however, that the COVID-19 pandemic blindsided it – as it has the rest of us.  The real problem here is that banks no longer really know their customers, but have seemingly placed over-reliance on a magical number – or more accurately, algorithm, which calculates one’s credit score.  Alas, you can be sure thie industry’s solution to the dearth of information isn’t one that will assist most of its customers in these trying times. Per the Journal;   “Without accurate information, their only option is to pull back on credit,” said Michael Abbott, head of banking for North America at consulting firm Accenture PLC. “Banks don’t know who is going to pay and who isn’t. It’s like flying blind into a credit storm.”

 House Democrats vote to reverse CRA rule — The House approved a resolution late Monday to overturn the Office of the Comptroller of the Currency’s rule to revamp the Community Reinvestment Act. The House voted along party lines to reverse the rule. Democratic leaders in the chamber used statutory power granted to Congress to review new regulations within 60 legislative days of an agency's publishing a policy in the Federal Register. The OCC's rule, which the agency finalized without support from any other bank regulator, has been popular among Democrats who say it will undermine the decades-old CRA law intended to combat redlining. “I am deeply concerned that the OCC’s final rule will harm low-income and minority communities that are disproportionately suffering during this crisis, effectively turning the Community Reinvestment Act into the Community Disinvestment Act,” House Financial Services Committee Chairwoman Maxine Waters, D-Calif., said on the House floor Monday. “If this resolution is not adopted, we will have different rules for different banks, leading to regulatory arbitrage and a race to the bottom of weaker standards that will only hurt the people the law was intended to help.” While the Congressional Review Act resolution sends a message of Democrats’ disapproval of the OCC’s plan, the Republican-controlled Senate is not expected to consider the measure. “Clear metrics and better reporting will enable banks, regulators and the public to have a better understanding of CRA activities of individual banks and of cross-sections of the industry,” said Rep. Patrick McHenry, R-N.C, in opposition to the resolution Monday. “Consumers will be able to see that and understand the type of institution they’re banking with as well.” The OCC, led by then-Comptroller of the Currency Joseph Otting, finalized its reform of the Community Reinvestment Act in late May, capping off a contentious rulemaking process that House Democrats frequently scrutinized.

Groups urge FHFA to extend comment period on GSE capital plan— Seventeen trade groups want the Federal Housing Finance Agency to double the comment period for a proposal to require Fannie Mae and Freddie Mac to hold more than five times their current capital levels. In a letter to FHFA Director Mark Calabria sent Tuesday, the organizations urged the agency to accept comments by Oct. 28, or an additional 60 days. The comment period is set to end Aug. 31. The letter was signed by the American Bankers Association, Center for Responsible Lending, Mortgage Bankers Association, Housing Policy Council, National Association of Realtors and Structured Finance Association, among others. “We believe that it is essential that market participants have time to focus on this complex proposed rule, which poses over 100 questions to respondents and has the potential to significantly affect both the cost and availability of mortgage financing, as well as affordability for homeowners and renters in both the single family and multifamily space,” the groups said. In a letter to FHFA Director Mark Calabria sent Tuesday, the organizations urged the agency to accept comments by Oct. 28, or an additional 60 days.Bloomberg NewsThe capital plan — which would go into effect once Fannie and Freddie exit government conservatorship — builds on a previous proposal issued in 2018 by former FHFA Director Mel Watt. That proposal had a 120-day comment period. The groups that signed the letter argued they should have a similar amount of time to comment on the new proposal. The coronavirus pandemic has limited the ability of market participants to review the plan thoughtfully, they added. “These unique and unprecedented circumstances further support the need for a longer period of time for public review of the [enterprise capital framework] and its implications for the GSEs, borrowers, consumer groups, lenders, servicers, investors and other market participants,” the trade groups said. The capital plan, which the FHFA unveiled in May, would align capital requirements for the government-sponsored enterprises with those of the large banks. Under the proposal, the GSEs would have had to hold a combined $234 billion in capital as of Sept. 30, 2019, representing 3.85% of their total assets and 13.9% of risk-weighted assets. Currently, Fannie and Freddie's retained earnings are capped at $45 billion combined.

FHFA leadership structure on shaky ground after CFPB ruling— The Supreme Court's invalidation of the single-director structure at the Consumer Financial Protection Bureau spells trouble for the head of the Federal Housing Finance Agency, legal experts say. Like the CFPB, the FHFA is led by a single director nominated to a five-year term. And the statutory restriction in the Dodd-Frank Act on a president's ability to fire a CFPB director — which the high court threw out on June 29 — is similar to the law that created the FHFA. Some observers say the court's ruling in Seila Law v. CFPB suggests it could rule the same way for the FHFA, or that that ruling is enough of a basis for a Joe Biden administration, should the Democrat win the White House in November, to fire Trump-appointed FHFA Director Mark Calabria. Either development would further complicate the futures of Fannie Mae and Freddie, which the FHFA regulates. “The opinion establishes why the [Housing and Economic Recovery Act] structure is just as unconstitutional as the CFPB's Dodd-Frank provisions, so if this were to come before the Supreme Court, they would rule precisely the same way,” said Richard Gottlieb, a partner at Manatt, Phelps & Phillips. In both cases, Congress sought to require a president to find sufficient cause before firing either agency's director, in order to preserve their independence and prevent the regulators from becoming too politicized. The legal questions over the FHFA's leadership structure complicate Director Mark Calabria's plans for Fannie Mae and Freddie Mac.Bloomberg NewsBut in a 5-4 decision written by Chief Justice John Roberts, the high court found that the CFPB’s structure vests too much power in the hands of one person, who does not answer to a board or commission, and that the president has broad authority to appoint and remove agency heads. The ruling gives a sitting president the ability to fire a CFPB director at will — eliminating the "for cause" provision in Dodd-Frank— but keeps the rest of the law and the agency intact. While the for-cause provisions in HERA and Dodd-Frank use different wording, many experts believe that the outcome of the CFPB case would apply to the FHFA, putting Calabria on shaky ground should the Democrats win the White House. The legal uncertainty has significant implications for how the FHFA manages and seeks to end Fannie and Freddie's conservatorships. “On the FHFA front, the Seila decision will weigh heavily on what the Supreme Court will do given the structural similarities between the CFPB and FHFA,” said Alan Kaplinsky, the co-practice leader at Ballard Spahr's consumer financial services group. “Both have a single director who can only be dismissed for cause, which is the core of the constitutionality question addressed by the Seila" decision. The high court could accept an FHFA constitutionality case sooner rather than later. The justices are set to decide soon whether to hear arguments in Collins v. Mnuchin, a case that challenges the single-director leadership structure of the FHFA.

Fannie Mae: Mortgage Serious Delinquency Rate Increased in May -- Fannie Mae reported that the Single-Family Serious Delinquency increased to 0.89% in May, from 0.70% in April. The serious delinquency rate is up from 0.70% in May 2019.This is the highest serious delinquency rate since June 2018.These are mortgage loans that are "three monthly payments or more past due or in foreclosure".The Fannie Mae serious delinquency rate peaked in February 2010 at 5.59%. By vintage, for loans made in 2004 or earlier (2% of portfolio), 3.09% are seriously delinquent (up from 2.64% in April). For loans made in 2005 through 2008 (3% of portfolio), 5.22% are seriously delinquent(up from 4.41%), For recent loans, originated in 2009 through 2018 (95% of portfolio), only 0.53% are seriously delinquent (up from 0.38%). So Fannie is still working through a few poor performing loans from the bubble years. With COVID-19, this rate will increase significantly in June and July (it takes time since these are mortgages three months or more past due). I believe mortgages in forbearance will be counted as delinquent in this monthly report, but they will not be reported to the credit bureaus.This is very different from the increase in delinquencies following the housing bubble.   Lending standards have been fairly solid over the last decade, and most of these homeowners have equity in their homes - and they will be able to restructure their loans once they are employed.Note: Freddie Mac reported earlier.

MBA Survey: "Share of Mortgage Loans in Forbearance Decreases Slightly to 8.47%" of Portfolio Volume -- Note: To put these numbers in perspective, the MBA notes "For the week of March 2, only 0.25% of all loans were in forbearance."   From the MBA: Share of Mortgage Loans in Forbearance Decreases Slightly to 8.47%: The Mortgage Bankers Association’s (MBA) latest Forbearance and Call Volume Survey revealed that the total number of loans now in forbearance decreased by 1 basis point from 8.48% of servicers’ portfolio volume in the prior week to 8.47% as of June 21, 2020. According to MBA’s estimate, 4.2 million homeowners are in forbearance plans. .. “The overall share of loans in forbearance declined for the second week in a row, led by the third straight drop in GSE loans,” said Mike Fratantoni, MBA’s Senior Vice President and Chief Economist. “Many borrowers initially received a three-month forbearance term, and as of June 21, 17 percent of loans in forbearance have now been extended, with the largest share of those being Ginnie Mae loans.” Added Fratantoni, “The level of forbearance requests remains quite low as of mid-June. The rebound in the housing market is likely one of the factors that is providing confidence to both potential homebuyers and existing homeowners during these troubled times.”

 Black Knight: Number of Homeowners in COVID-19-Related Forbearance Plans Declined  -Note: Both Black Knight and the MBA (Mortgage Bankers Association) are putting out weekly estimates of mortgages in forbearance.From Black Knight: Forbearances Reverse Course, See Largest Weekly Decline Yet:  Overall, the number of active forbearance plans is down 104K from last week for the lowest weekly total active forbearances we’ve seen since the first week of May. This latest drop brings us down 183K from the peak on May 22 and brings us back to the trend of improvement we’d seen throughout June.According to daily mortgage payment tracking data, as of the end of June, roughly a quarter of homeowners in forbearance had remitted their June payment. That’s as compared to 46% in April and approximately 30% in May.What remains to be seen is what impact the new spikes in COVID-19 around much of the country will have on forbearance requests moving forward. If they lead to another round of shutdowns – or extensions of those already in effect – and put upward pressure on unemployment numbers, we could see yet another reversal of this trend. The same holds true for the looming expiration of expanded unemployment benefits. As of June 30, 4.58 million homeowners are in forbearance plans, representing 8.6% of all active mortgages, down from 8.8% last week. Together, they represent just under $1 trillion in unpaid principal ($995B).

 MBA: Mortgage Applications Decrease in Latest Weekly Survey --From the MBA: Mortgage Applications Decrease in Latest MBA Weekly Survey Mortgage applications decreased 1.8 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending June 26, 2020.... The Refinance Index decreased 2 percent from the previous week and was 74 percent higher than the same week one year ago. The seasonally adjusted Purchase Index decreased 1 percent from one week earlier. The unadjusted Purchase Index decreased 2 percent compared with the previous week and was 15 percent higher than the same week one year ago.“Mortgage applications fell last week despite mortgage rates hitting another record low in MBA’s survey. Investors are contemplating the risks of the recent resurgence of COVID-19 cases to the labor market and economy, and Treasury rates and mortgage rates are moving lower as a result,” said Joel Kan, MBA’s Associative Vice President of Economic and Industry Forecasting. “After two months of strong growth, purchase applications declined for the second week in a row. The weakening in activity is potentially a signal that pent-up demand is starting to wane and that low housing supply is limiting prospective buyers’ options. The average purchase application loan size increased to a record high in our survey – more proof that tight inventory conditions are leading to faster price growth.The first graph shows the refinance index since 1990.The refinance index has been very volatile recently depending on rates and liquidity. But the index is up signficantly from last year.

Case-Shiller: National House Price Index increased 4.7% year-over-year in April -- S&P/Case-Shiller released the monthly Home Price Indices for April ("April" is a 3 month average of February, March and April prices).This release includes prices for 20 individual cities, two composite indices (for 10 cities and 20 cities) and the monthly National index.From S&P: Annual Home Price Gains Remained Steady In April According To S&P CoreLogic Case-Shiller Index The S&P CoreLogic Case-Shiller U.S. National Home Price NSA Index, covering all nine U.S. census divisions, reported a 4.7% annual gain in April, up from 4.6% in the previous month. The 10-City Composite annual increase came in at 3.4%, remaining the same as last month. The 20-City Composite posted a 4.0% year-over-year gain, up from 3.9% in the previous month.Phoenix, Seattle and Minneapolis reported the highest year-over-year gains among the 19 cities (excluding Detroit) in April. Phoenix led the way with an 8.8% year-over-year price increase, followed by Seattle with a 7.3% increase and Minneapolis with a 6.4% increase. Twelve of the 19 cities reported higher price increases in the year ending April 2020 versus the year ending March 2020. The National Index posted a 1.1% month-over-month increase, while the 10-City and 20-City Composites posted increases of 0.7% and 0.9% respectively before seasonal adjustment in April. After seasonal adjustment, the National Index posted a month-over-month increase of 0.5%, while the 10- City and 20-City Composites both posted 0.3% increases. In April, all 19 cities (excluding Detroit) reported increases before seasonal adjustment, while 16 of the 19 cities reported increases after seasonal adjustment. “The National Composite Index rose by 4.7% in April 2020, with comparable growth in the 10- and 20-City Composites (up 3.4% and 4.0%, respectively). In all three cases, April’s year-over-year gains were ahead of March’s, continuing a trend of gently accelerating home prices that began last fall. Results in April continued to be broad-based. Prices rose in each of the 19 cities for which we have reported data, and price increases accelerated in 12 cities. “As was the case in March, we have data from only 19 cities this month, since transactions records for Wayne County, Michigan (in the Detroit metropolitan area) continue to be unavailable. This is, so far, the only directly visible impact of COVID-19 on the S&P CoreLogic Case-Shiller Indices. The price trend that was in place pre-pandemic seems so far to be undisturbed, at least at the national level. Indeed, prices in 12 of the 20 cities in our survey were at an all-time high in April. The first graph shows the nominal seasonally adjusted Composite 10, Composite 20 and National indices (the Composite 20 was started in January 2000). The second graph shows the Year over year change in all three indices.

Lots of Brain-Dead Misreporting About the Case-Shiller Home Price Index this Morning - Wolf Richter - I feel like I’m fighting a one-man battle against media misinformation or something. I didn’t want to descend into housing-data purgatory with you, and you didn’t want to either, but now we’re on the way after the horrifically brain-dead misreporting in the media about the Case Shiller Home Price Index this morning by lazy-ass reporters, or increasingly by spaghetti-code algos, who didn’t bother to read the Case-Shiller methodology – or better yet, my past articles about the Case-Shiller Index.These brain-dead reporters – or the spaghetti-algos that wrote the reports – went like this: National home prices rose 4.8% year-over-year in April, during the peak of the lockdowns and despite the pandemic, showing how vibrant the housing market is.But that is bull malarkey because the S&P CoreLogic Case-Shiller Home Price Index doesn’t work that way. It lags massively behind. With the Case-Shiller Index – my favorite home price index because of the way it is structured – you have to be patient. That’s its big drawback.The Case-Shiller Index operates on a “three-month rolling average” basis. And the price data is collected from public records. So the release today, titled “April,” was the three-month moving average for deals whose data became available in the county deed recorders in February, March, and April.There is also a time-lag between when a deal closes and when the data becomes available in the county deed recorders.So what the Case-Shiller showed today were closings that had occurred in prior months and that became available in the county deed recorders in February, March, and April. This included some of the deals that closed in January and excluded some of the deals that closed in April.This is not a secret. S&P publishes the methodology. And reporters should have studied it before reporting bull-malarkey and misinforming their readers, many of whom paid a subscription to be misinformed.The Case-Shiller Index uses the “repeat sales method” where it compares the sales price of a house that sold in the current month to the price of the samehouse when it sold previously. To make it into the index, a house has to have been sold at least twice. This sales-pair method makes the index immune to changes in the mix of houses that sold, which is an advantage over the common median-price indices. The index essentially tracks price changes for each house in the index separately over time and then builds an index out of the sales-pair data. The index provider also applies some algorithms to iron out certain issues, such as improvements made to the house over time.

NAR: Pending Home Sales Increase 44.3% in May - From the NAR: Pending Home Sales Notch Record-Setting 44.3% Monthly Increase in May:  Pending home sales mounted a record comeback in May, seeing encouraging contract activity after two previous months of declines brought on by the coronavirus pandemic, according to the National Association of Realtors®. Every major region recorded an increase in month-over-month pending home sales transactions, while the South also experienced a year-over-year increase in pending transactions. The Pending Home Sales Index (PHSI),*, a forward-looking indicator of home sales based on contract signings, rose 44.3% to 99.6 in May, chronicling the highest month-over-month gain in the index since NAR started this series in January 2001. Year-over-year, contract signings fell 5.1%. An index of 100 is equal to the level of contract activity in 2001. ... The Northeast PHSI grew 44.4% to 61.5 in May, although it was still down 33.2% from a year ago. In the Midwest, the index rose 37.2% to 98.8 last month, down 1.4% from May 2019. Pending home sales in the South increased 43.3% to an index of 125.5 in May, up 1.9% from May 2019. The index in the West jumped 56.2% in May to 89.2, down 2.5% from a year ago. This was well above expectations for this index. Note: Contract signings usually lead sales by about 45 to 60 days, so this would usually be for closed sales in June and July.

 US Pending Home Sales Explode By Record In May... Back To 2001 Levels -  New home sales soared and existing home sales plunged, leaving pending home sales as the tie-breaker for May's picture of the US housing market. After crashing by over 20% MoM in both March and April, analysts expected a 19.3% rebound MoM in May but instead it exploded by a record 44.3% MoM...but pending home sales remain down 10.4% YoY... Pending sales represents signed contracts in the month of May, when mortgage rates had collapsed.“This has been a spectacular recovery for contract signings, and goes to show the resiliency of American consumers and their evergreen desire for homeownership,” said Lawrence Yun, NAR’s chief economist.“This bounce back also speaks to how the housing sector could lead the way for a broader economic recovery.” The month of May saw each of the four regional indices rise on a month-over-month basis after all were down in April 2020.

  • The Northeast PHSI grew 44.4% to 61.5 in May, although it was still down 33.2% from a year ago.
  • In the Midwest, the index rose 37.2% to 98.8 last month, down 1.4% from May 2019.
  • Pending home sales in the South increased 43.3% to an index of 125.5 in May, up 1.9% from May 2019.
  • The index in the West jumped 56.2% in May to 89.2, down 2.5% from a year ago.

NAR now expects existing-home sales to reach 4.93 million units in 2020 and new home sales to hit 690,000. “All figures light up in 2021 with positive GDP, employment, housing starts and home sales.More listings are continuously appearing as the economy reopens, helping with inventory choices,” Yun said.However we note that despite the record rebound, the pending home sales index remains below 2001 levels...

 Construction Spending Decreased in May --From the Census Bureau reported that overall construction spending decreased in May: Construction spending during May 2020 was estimated at a seasonally adjusted annual rate of $1,356.4 billion, 2.1 percent below the revised April estimate of $1,386.1 billion. The May figure is 0.3 percent above the May 2019 estimate of $1,352.9 billion. During the first five months of this year, construction spending amounted to $543.2 billion, 5.7 percent above the $513.7 billion for the same period in 2019. Private spending decreased and public spending increased:  Spending on private construction was at a seasonally adjusted annual rate of $1,001.2 billion, 3.3 percent below the revised April estimate of $1,035.2 billion. ...In May, the estimated seasonally adjusted annual rate of public construction spending was $355.2 billion, 1.2 percent above the revised April estimate of $350.9 billion. This graph shows private residential and nonresidential construction spending, and public spending, since 1993. Note: nominal dollars, not inflation adjusted.  Residential spending is 21% below the previous peak. Non-residential spending is 12% above the previous peak in January 2008 (nominal dollars).  Public construction spending is 9% above the previous peak in March 2009, and 35% above the austerity low in February 2014.  The second graph shows the year-over-year change in construction spending. On a year-over-year basis, private residential construction spending is up slightly. Non-residential spending is down 3.4% year-over-year. Public spending is up  4.7% year-over-year. This was below consensus expectations of a 1% increase in spending, however construction spending for the previous year was revised up. Construction was considered an essential service in most areas and did not decline sharply like many other sectors.

Update: Framing Lumber Future Prices Up Year-over-year --Here is another monthly update on framing lumber prices.   Lumber prices declined sharply from the record highs in early 2018, and then increased until the COVID-19 crisis. This graph shows two measures of lumber prices: 1) Framing Lumber from Random Lengths through June 26, 2020 (via NAHB), and 2) CME framing futures.  Right now Random Lengths prices are up 36% from a year ago, and CME futures are up 14% year-over-year.  There is a seasonal pattern for lumber prices, and usually prices will increase in the Spring, and peak around May, and then bottom around October or November - although there is quite a bit of seasonal variability.  Prices fell sharply due to COVID-19, however prices have bounced back (Note: Construction was considered an essential activity in many areas, so construction didn't decline as much as some other sectors).

  Utility bills will likely increase by 10% on average in big cities this summer - With millions of Americans still at home, about 1 in 3 people nationwide are expected to see their utility bills go up by at least 10% this summer. That's according to renewable energy company Arcadia, which measured the increase in residential energy use from 10,000 customer households across 13 major U.S. cities in March and April 2020 to estimate how much more power Americans consume when under stay-at-home orders or unemployed. Overall, Arcadia estimates Americans in the 13 cities studied (which make up about a third of the U.S. population) will spend between $2 and $37 more on utility bills during June, July and August, just from spending more time at home.That's because the more time people spend at home, the more electricity, water and gas they use during daytime hours, Arcadia found. About half of the entire U.S. workforce is now working remotely, 35% of which made the switch recently because of the pandemic, according torecent research from MIT economists. It's worth noting that the expected 10% increase doesn't even take into account the electricity bill surge that typically happens in summer due to rising temperatures.The level of energy use will vary city to city, Arcadia says. Those with denser populations like Philadelphia and New York will be hit hardest, while those on the West Coast, such as Seattle and San Francisco, will see smaller increases, according to Arcadia's research.  Arcadia estimated summer utility bill spikes across 13 of the largest U.S. metro areas using the bill history of 10,000 households.

Indiana regulators deny request from NIPSCO, other utilities to charge customers for lost revenue during the pandemic  - A state regulatory agency has denied the request of NIPSCO and other utilities to charge customers for electricity and natural gas they did not use during the coronavirus pandemic. NIPSCO, Duke Energy Indiana, Indiana Michigan Power Co., Indianapolis Power & Light, Vectren and five other utilities petitioned Indiana to track losses from lower gas and electricity use during the COVID-19 outbreak for future recovery through rate hikes, arguing the state guaranteed a certain profit margin when originally setting their rates. Utilities said they suffered financial losses during the pandemic when many businesses closed as a result of stay-at-home orders. The Indiana Utility Regulatory Commission shot down the request to recover lost revenue. "Under the regulatory compact, at a base level, utilities are obligated to provide safe, reliable service and customers are obligated to pay just and reasonable rates for any such service they receive," the IURC said in in its order. "The balance of this order seeks to work toward allowing customers to meet their obligation while providing utilities the reasonable relief they need to help such customers do so. However, asking customers to go beyond their obligation and pay for service they did not receive is beyond reasonable utility relief based on the facts before us.”The IURC also extended its prohibition on disconnecting utility service for another 45 days, until Aug. 14. Utilities cannot collect late fees, convenience fees, deposits and reconnection fees during that period.

Trade Deficit increased to $54.6 Billion in May --From the Department of Commerce reported: The U.S. Census Bureau and the U.S. Bureau of Economic Analysis announced today that the goods and services deficit was $54.6 billion in May, up $4.8 billion from $49.8 billion in April, revised. May exports were $144.5 billion, $6.6 billion less than April exports. May imports were $199.1 billion, $1.8 billion less than April imports.Both exports and imports decreased in May.     Exports are down 32% compared to May 2019; imports are down 25% compared to May 2019.Both imports and exports have decreased sharply due to COVID-19.The second graph shows the U.S. trade deficit, with and without petroleum.  The blue line is the total deficit, and the black line is the petroleum deficit, and the red line is the trade deficit ex-petroleum products.m Note that the U.S. exported a slight net positive petroleum products in recent months.  Oil imports averaged $27.55 per barrel in May, down from $34.72 per barrel in April, and down from $62.60 in May 2019.The trade deficit with China decreased to $27.0 billion in May, from $30.1 billion in May 2019.

"Chemical Activity Barometer Falls Slightly In June" - Note: This appears to be a leading indicator for industrial production. From the American Chemistry Council: Chemical Activity Barometer Falls Slightly In June: The Chemical Activity Barometer (CAB), a leading economic indicator created by the American Chemistry Council (ACC), eased 0.3 percent in June on a three-month moving average (3MMA) basis following a 4.6 percent decline in May. On a year-over-year (Y/Y) basis, the barometer fell 12.0 percent in June. The unadjusted data show a 3.5 percent gain in June following a 2.2 percent gain in May and a 6.3 percent decline in April. The diffusion index rose from 35 percent to 53 percent. The diffusion index marks the number of positive contributors relative to the total number of indicators monitored. The CAB reading for May was revised upward by 2.68 points and the April reading was revised upward by 0.05 points.“While the latest CAB reading is consistent with a recession, two consecutive months of gains in the unadjusted data is a positive development,” said Kevin Swift, chief economist at ACC. “We’ll want to see at least another month of gains in order to conclude that the economy has turned a corner.” This graph shows the year-over-year change in the 3-month moving average for the Chemical Activity Barometer (CAB) compared to Industrial Production.

BEA: June Vehicles Sales increased to 13.0 Million SAAR - The BEA released their estimate of May vehicle sales this morning. The BEA estimated light vehicle sales of 13.05 million SAAR in June 2020 (Seasonally Adjusted Annual Rate), up 5.7% from the revised May sales rate, and down 24.1% from June 2019. This graph shows light vehicle sales since 2006 from the BEA (blue) and an estimate for June 2020 (red). The impact of COVID-19 is significant, and it appears April was the worst month.The second graph shows light vehicle sales since the BEA started keeping data in 1967. Note: dashed line is current estimated sales rate of 13.05 million SAAR. Sales collapsed in the second half of March, and really declined in April. However sales rebounded in May, and increased further in June.

ISM Manufacturing index Increased to 52.6 in June - The ISM manufacturing index indicated expansion in June. The PMI was at 52.6% in June, up from 43.1% in May. The employment index was at 42.1%, up from 32.1% last month, and the new orders index was at 56.4%, up from 31.8%. From the Institute for Supply Management: June 2020 Manufacturing ISM® Report On Business®  “The June PMI® registered 52.6 percent, up 9.5 percentage points from the May reading of 43.1 percent. This figure indicates expansion in the overall economy for the second straight month after April’s contraction, which ended a period of 131 consecutive months of growth. The New Orders Index registered 56.4 percent, an increase of 24.6 percentage points from the May reading of 31.8 percent. The Production Index registered 57.3 percent, up 24.1 percentage points compared to the May reading of 33.2 percent. The Backlog of Orders Index registered 45.3 percent, an increase of 7.1 percentage points compared to the May reading of 38.2 percent. The Employment Index registered 42.1 percent, an increase of 10 percentage points from the May reading of 32.1 percent. The Supplier Deliveries Index registered 56.9 percent, down 11.1 percentage points from the May figure of 68 percent. Here is a long term graph of the ISM manufacturing index. This was above expectations of 49.0%, but the employment index indicated further contraction. This suggests manufacturing expanded slightly in June, after the steep collapse in the previous months.

Markit Manufacturing: "Record rise in manufacturing PMI amid looser COVID-19 restrictions" - The June US Manufacturing Purchasing Managers' Index conducted by Markit came in at 49.8, up 10 from the 39.8 final May figure. Markit's Manufacturing PMI is a diffusion index: A reading above 50 indicates expansion in the sector; below 50 indicates contraction. Here is an excerpt from Chris Williamson, Chief Business Economist at IHS Markit in their latest press release:“US manufacturers have reported a marked turnaround in business conditions through the second quarter, with collapsing production and demand in April at the height of the COVID-19 lockdown turning rapidly to stabilisation by June. The PMI posted a record 10-point rise in June amid unprecedented gains in the survey’s output, employment and order book gauges.“The record rise in the New Orders Index, coupled with low inventory holdings, bodes well for a further improvement in production momentum in July. A record upturn in business sentiment about the year ahead likewise hints that business spending and employment will start to revive.“However, while the PMI currently points to a strong v-shaped recovery, concerns have risen that momentum could be lost if rising numbers of virus infections lead to renewed restrictions and cause demand to weaken again.” [Press Release]  Here is a snapshot of the series since mid-2012.

US Manufacturing Survey Jumps By Record In June (In Contraction & Expansion) Despite the record surge in the US Macro Surprise Index, May's rebound in 'soft' survey data was much more mixed than many prefer to cherry-pick (PMI rebound much more dramatic than ISM), but flash PMIs suggest June saw the re-opening euphoria is set to accelerate...

  • ISM Manufacturing in Expansion - 52.6 vs 49.8 expectations and 43.1 prior - best since April 2019
  • PMI Manufacturing in Contraction - 49.8 vs 49.6 expectations and 39.8 prior - a record 10 point jump

Graphs: Bloomberg. Markit's PMI noted that employment across the manufacturing sector declined for the fourth month running in June, as firms shed workers at a moderate pace following subdued demand. Signs of excess capacity remained evident as manufacturers registered a sharp reduction in backlogs of work. However, the overall loss of jobs was considerably weaker than those seen in the prior two months. The PMI recorded its largest increase since August 1980, when it increased 10.5 percentage points. Among the big six industries, three of the industry sectors expanded. New Orders and Production returned to expansion, and at respectable levels. Supplier Deliveries reached a normal level of tension between supply and demand. Five of the 10 subindexes registered expansion, a marked improvement from previous periods.  ISM's data showed a surge in new orders but far less of a jump in employment... This is the biggest increase in new orders ever... Chris Williamson, Chief Business Economist at IHS Markit said: “US manufacturers have reported a marked turnaround in business conditions through the second quarter, with collapsing production and demand in April at the height of the COVID-19 lockdown turning rapidly to stabilisation by June. The PMI posted a record 10-point rise in June amid unprecedented gains in the survey’s output, employment and order book gauges.

June data starts out with a bright spot in manufacturing -  Earlier this week the last of the regional Fed Districts, Dallas, reported their manufacturing indexes for June. The overall picture has been a strong rebound:

On a month over month basis, the average is up +36 from -30 to +6.   The regional Fed indexes almost always telegraph the direction, and sometimes the amplitude, of the ISM manufacturing index for the entire country. That was certainly the case for June. This morning the ISM reported that manufacturing in the US rebounded strongly, up +9.5 from a contracting reading of 43.1 to an expanding reading of 52.6. The even more forward-looking new orders subindex rose from a horrible 31.8 to a strongly expansionary 56.4: This is good news in an important indicator. Unfortunately, whether it will remain that way in the face of renewed restrictions in States that had recklessly reopened is very much open to question.

Dallas Fed: "Manufacturing Regains Footing After Epic Decline" From the Dallas Fed: Manufacturing Regains Footing After Epic Decline Texas factory activity rebounded strongly in June, according to business executives responding to the Texas Manufacturing Outlook Survey. The production index, a key measure of state manufacturing conditions, climbed from -28.0 to 13.6, indicating moderate expansion in output following three months of record or near-record declines. Other measures of manufacturing activity also pointed to a rebound in growth this month. The new orders index advanced 34 points to 2.9, its first positive reading in four months, with nearly a third of manufacturers noting an increase in orders. The growth rate of orders index pushed up 25 points but remained negative at -5.8. The capacity utilization and shipments indexes also returned to positive territory. Perceptions of broader business conditions were mixed in June. The general business activity index surged 43 points but stayed negative at -6.1. The company outlook index climbed back into positive territory, from -34.6 to 2.7, with 29 percent of manufacturers noting improved outlooks, up from 12 percent last month. The index measuring uncertainty regarding companies’ outlooks retreated notably again to 9.1—its lowest reading since January. The positive reading still indicates increased uncertainty. Labor market measures indicated virtually flat employment levels and shorter workweeks this month. The employment index remained negative but rose 10 points to -1.5. Fifteen percent of firms noted net hiring, while 17 percent noted net layoffs. The hours worked index rose from -22.8 to -4.3, with the still-negative reading signaling reduced workweek length. This was the last of the regional Fed surveys for June. Here is a graph comparing the regional Fed surveys and the ISM manufacturing index:

Chicago PMI Edges Up in June - The Chicago Business Barometer, also known as the Chicago Purchasing Manager's Index, is similar to the national ISM Manufacturing indicator but at a regional level and is seen by many as an indicator of the larger US economy. It is a composite diffusion indicator, made up of production, new orders, order backlogs, employment, and supplier deliveries compiled through surveys. Values above 50.0 indicate expanding manufacturing activity.The latest Chicago Purchasing Manager's Index, or the Chicago Business Barometer, rose to 36.6 in June from 32.2 in May, which is in contraction territory. Values above 50.0 indicate expanding manufacturing activity. Here is an excerpt from the press release:The Chicago Business BarometerTM, produced with MNI, rose to 36.6 in June with business activity picking up as Covid-19 related shutdowns eased somewhat. Across Q2, business sentiment slipped 11.8 points to 34.8, hitting the lowest level since Q1 2009.Among the main five indicators, Production and New Orders saw the largest monthly gains, while Supplier Deliveries and Employment faltered. [Source]Let's take a look at the Chicago PMI since its inception.

 Record 47.2 percent of working-age Americans without jobs - According to newly released Bureau of Labor Statistics (BLS) figures, 47.2 percent of working-age Americans were without work in May, the highest level recorded since the end of World War II. The numbers are based on the BLS employment-population ratio, which states the proportion of the total labor force who are actually working. It is a more accurate measure of joblessness than the monthly unemployment report, which counts only those actively seeking work. At the end of May the employment-population ratio stood at 52.8 percent; it stood at 61.2 percent at the start of the year. The employment-population ratio reached a postwar high of nearly 65 percent in 2000. Citing Torsten Slok, the chief economist at Deutsche Bank, CNBC said it would take the creation of an additional 30 million jobs to bring the employment-population ratio back to January levels. The report comes ahead of the release of the official jobless statistics for June later this week. They are expected to reflect a marginal decline in the official unemployment rate from 13.3 percent in May to 12.4 percent in June. It is not known if the June figures will correct the previous undercount in the numbers of May and April, when millions of workers were incorrectly classified. This resulted in the official jobless percentages being about 3 percent lower in May and 5 percent lower in June. The official unemployment rate remains at Great Depression levels in a number of states. Nevada, hard hit by the shutdown of the gaming industry, had an unemployment rate of 25.3 percent in May compared to 4.0 percent one year earlier. Hawaii stood at 22.6 percent in May compared to just 2.7 percent one year earlier, while Michigan registered 21.2 percent compared to 4.2 percent in May 2019. In California and Massachusetts, unemployment stood at 16.3 percent in May.

Comments on Weekly Unemployment Claims - Mcbride - On a monthly basis, most analysts focus on initial unemployment claims for the BLS reference week of the employment report.  For July, the BLS reference week will be July 12th through the 18th, and initial claims for that week will be released on Thursday, July 23rd. Note that a few states have not released Pandemic Unemployment Assistance (PUA) claims yet. This includes Georgia, New Hampshire and a few other areas - so the number of PUA claims is too low. However, there may also be processing delays that are impacting the numbers.  increased slightly last week to 19,290,000 (SA) from 19,231,000 (SA) the previous week. However, continued claims are down 5.6 million from the peak, suggesting a large number of people have returned to their jobs (as the employment report showed). The following graph shows regular initial unemployment claims (blue) and PUA claims (red) since early February.  This was the 15th consecutive week with extraordinarily high initial claims. It is possible that we are starting to see some layoffs associated with the end of some early Payroll Protection Plan (PPP) participants.We should start seeing layoffs associated with the rising COVID cases and hospitalization in some states (like Arizona, Florida and Texas).  With bar and restaurant closings in some areas, we will probably see more initial claims in those states in the coming week, and that will show up in the report the following week. Note that these states don't have to lockdown to see a decline in economic activity. As Merrill Lynch economists noted last month: "Most of the slowdown occurred due to voluntary social distancing rather than lockdown policies." Initial unemployment claims, and continued claims (and PUA claims) are important high frequency indicators to follow right now.

ADP: Private Employment increased 2,369,000 in June - From ADP: Private sector employment increased by 2,369,000 jobs from May to June according to the June ADP National Employment Report®. ... The report, which is derived from ADP’s actual payroll data, measures the change in total nonfarm private employment each month on a seasonally-adjusted basis.  “Small business hiring picked up in the month of June,” said Ahu Yildirmaz, vice president and co-head of the ADP Research Institute. “As the economy slowly continues to recover, we are seeing a significant rebound in industries that once experienced the greatest job losses. In fact, 70 percent of the jobs added this month were in the leisure and hospitality, trade and construction industries.”   This was below the consensus forecast for 3,000,000 private sector jobs added in the ADP report.  The BLS report will be released Thursday (Friday is a holiday), and the consensus is for 3,074,000 non-farm payroll jobs added in June.

June Employment Report: 4.8 Million Jobs Added, 11.1% Unemployment Rate - From the BLS: Total nonfarm payroll employment rose by 4.8 million in June, and the unemployment rate declined to 11.1 percent, the U.S. Bureau of Labor Statistics reported today. These improvements in the labor market reflected the continued resumption of economic activity that had been curtailed in March and April due to the coronavirus (COVID-19) pandemic and efforts to contain it. In June, employment in leisure and hospitality rose sharply. Notable job gains also occurred in retail trade, education and health services, other services, manufacturing, and professional and business services....The change in total nonfarm payroll employment for April was revised down by 100,000, from -20.7 million to -20.8 million, and the change for May was revised up by 190,000, from +2.5 million to +2.7 million. With these revisions, employment in April and May combined was 90,000 higher than previously reported. The first graph shows the year-over-year change in total non-farm employment since 1968. In June, the year-over-year change was -12.957 million jobs. Total payrolls increased by 4.8 million in June. Payrolls for April and May were revised up 90 thousand combined. The second graph shows the job losses from the start of the employment recession, in percentage terms. The current employment recession is by far the worst recession since WWII in percentage terms, and the worst in terms of the unemployment rate. The third graph shows the employment population ratio and the participation rate. The Labor Force Participation Rate increased to 61.5% in June. This is the percentage of the working age population in the labor force. The Employment-Population ratio increased to 54.6% (black line). The fourth graph shows the unemployment rate. The unemployment rate decreased in June to 11.1%. This was well above consensus expectations of 3,070,000 jobs added, and April and May were revised up by 90,000 combined.

U.S. Unemployment Rate Fell to 11.1% in June - Unemployment fell and the U.S. economy regained 4.8 million jobs in June, but the recent surge in coronavirus infections could throw the recovery off course. The job growth followed May’s payroll gain of 2.7 million and showed people were getting back to work and the economy was healing faster than anticipated. Still, the U.S. labor market is operating with about 15 million fewer jobs than in February, the month before the pandemic struck the U.S., while the country faces an increase in coronavirus cases that has led some states and businesses to change course on reopenings. There already are signs the economy could be affected by the virus surge that started in late June, after surveys were completed for the jobs report. Restaurant seating in several large cities declined at the end of the month and credit-card spending eased, said Sung Won Sohn, an economist at Loyola Marymount University. Mr. Sohn said the data suggested that consumers, the driving force behind the U.S. economy, started to grow cautious as cases increased. “Normally we should be celebrating a gain of 4.8 million jobs, but there are dark clouds ahead of us dashing hope of a V-shaped recovery,” he said. The June unemployment rate fell to 11.1% from 13.3% in May, even though there were significantly more workers who were accurately counted as unemployed in June compared with previous surveys during the pandemic, according to the Labor Department. U.S. stocks rose as the employment figures brought reassurance that the economic recovery was continuing. Still, the jobless rate remains at historically high levels. Until March, before the pandemic drove the U.S. into a deep recession, the unemployment rate was hovering around a 50-year low of 3.5%. A curbside recruitment fair in Grand Rapids, Mich., in June.  Hiring last month was supported by business reopenings and government aid. States across the U.S. reopened restaurants, gyms and salons that had been shut for several weeks to contain the virus’s spread. Small businesses that tapped federal loans through the Paycheck Protection Program continued to recall workers. Job gains in leisure and hospitality—a sector hard hit by the shutdowns—accounted for about 40% of June’s employment growth. Restaurants and bars were the main driver. But those workers are particularly vulnerable to renewed layoffs because a recent rise in cases in several states is causing governors to halt or roll back reopenings.

June jobs report: the last hurrah of the wished-for “V-shaped” coronavirus recovery - HEADLINES:

  • 4,800,000 million jobs added. This makes up about 22% of the 22.1 million job losses in March and April.
  • U3 unemployment rate improved 2.2% from 13.3% to 11.1%, compared with the January low of 3.5%.
  • U6 underemployment rate improved 3.2% from 21.2% to 18.0%, compared with the January low of 6.9%.
  • Those on temporary layoff declined 4,778,000 to 10.565 million.
  • Permanent job losers increased by 588,000.
  • April was revised downward by -100,000. May was revised higher by 190,000 respectively, for a net of 90,000 more jobs gained compared with previous reports.
  • the average manufacturing workweek rose 0.5 hours from a downwardly revised 38.7 hours to 39.2 hours. This is one of the 10 components of the LEI and will be a positive.
  • Manufacturing jobs rose by 356,000. Manufacturing has still lost 757,000  jobs in the past 4 months, or 6% of the total.
  • construction jobs rose by 158,000. Even so, in the past 4 months 472,000 construction jobs have been lost, or about 6% of the total.
  • Residential construction jobs, which are even more leading, rose by 19,100. Even so, in the past 4 months there have still been 45,900 lost jobs, or about 5% of the total.
  • temporary jobs rose by 148,900. Since February, there have still been 696,100 jobs lost, or 24% of all temporary help jobs.
  • the number of people unemployed for 5 weeks or less declined by 1.037 million to 2.838 million, compared with April’s total of 14.283 million. This is similar to the “less awful” readings of the weekly initial jobless claims.
  • Professional and business employment rose by 306,000, which is still 1.830 million, or about 8% below its February peak.
  • Average Hourly Earnings for Production and Nonsupervisory Personnel: declined $0.23 from $24.97 to $24.74, which is still a gain of over 2.6% in 4 months. This reflects that job losses were primarily among lower wage earners, who have been disproportionately recalled to work.
  • the index of aggregate hours worked for non-managerial workers rose by 4.2%. In the past 4 months combined this has nevertheless fallen by about 11%.
  • the index of aggregate payrolls for non-managerial workers rose by 3.2%. In the past 4 months combined this has nevertheless fallen by about 8%. 
  • Full time jobs were responsible for 2.418 million of the gains.
  • Part time jobs were responsible for 2.438 million of the gains.
  • The number of job holders who were part time for economic reasons declined by 1,571 million to 9.062 million. This is still an increase since February of 4.744 million.

SUMMARY: The most important fact to know about this report is that it covers the payroll period from May 13 through June 12. During that time initial jobless claims continued to decline strongly, so it was no surprise that this jobs report included a strongly positive headline number. With only one exception, all of the important internals were also positive. This was a reflection of a broad-based recall to work in many States that “reopened” their economies. Even the decline in average hourly wages was actually a positive, since it reflected lower paid workers being recalled to work.   The only negative was that the number of permanent job losses increased by over 1/2 million. This tells us that the underlying damage to the economy from the pandemic is spreading out and becoming more long-lasting. Since June 12 both initial and continuing jobless claims have declined only slightly. More States that recklessly reopened are having to partially shut down businesses like restaurants and bars again. So this report - which shows a total recovery of about 1/3 of the job losses since February - is going to be one of the last hurrahs of the wished-for “V-shaped” recovery from the coronavirus lockdowns. 

A strong jobs report but big holes remain and we’re not outta the viral woods. -Jared Bernstein - Payrolls popped up by 4.8 million in June, as commerce continued to gradually reopen across the country. Most industries (75 percent) added jobs, and millions of furloughed workers were called back, taking the unemployment down to 11.1 percent from 13.3 percent in May.The strong report begs the question: are we out of the virus-infected woods? Has the pandemic-induced recession ended as we enter a strong bounce-back to a solid expansion?The answer is as best uncertain and, based on recent state-level spikes in the virus, likely “no.” That is, absent a second wave of the virus, the economy has probably bottomed out, and yes, more labor market reports like June’s would restore a job market that would start to reliably repair the deeply damaged fortunes of working families.But the hole in the economy and in family earnings is still large, unemployment remains at recessionary levels, racial gaps are beginning to predictably grow, continuing unemployment claims, also out this morning, are still high and stagnant (i.e., stuck at very high levels). Most importantly, the failure of national leadership to control the virus means forthcoming reports may not be this strong. The figure below shows just how far payroll jobs fell off a cliff as the virus took hold, and how, even with two strong months of job gains—4.8 million in June and 2.7 million in May—a huge hole of almost 15 million jobs remains.  Similarly, the table below shows highly elevated unemployment rates relative to February, with the rates for Blacks and Hispanics up about three percentage points more than for whites. Note that in the last recession, unemployment peaked at 10 percent, below today’s 11.1 percent.  As noted, most sectors added jobs in June. Restaurant and bar re-openings alone added 1.5 million jobs, accounting for almost a third of the total gains. Factory employment was up 356,000 in June, following on May’s gain of 250,000. Still, manufacturing has recovered less than half of the 1.4 million jobs lost since February.State government—down 25,000—was an important exception to the overall trend, and states have consistently lost jobs over the crisis. This is a germane observation for Congress as they contemplate the next round of fiscal relief, in which aid to states should be an essential component. One important and unusual characteristic of the pandemic recession has been the highly elevated share of the unemployed on temporary furlough. A key question of the strength of the nascent expansion is whether these jobless persons would move back into the employment column as they are rehired at reopening businesses or move over the more permanent jobless column. The BLS pointed out that “June’s unemployment decline occurred primarily among people on temporary layoff. There were 10.6 million people on temporary layoff in June, down by 4.8 million.” This is a positive sign, one that bears watching in coming months as temporary layoffs as a share of the unemployed, at 60 percent, is still highly elevated. To the extent workers exit temporary layoffs to return to work, the expansion should experience a faster liftoff.

Comments on June Employment Report – McBride (graphs) The labor market swings have been huge, and the June employment report was better than expected with 4.8 million jobs added. Leisure and hospitality led the way with 2.088 million jobs added in June, following 1.403 million jobs added in May. Leisure and hospitality lost 8.318 million jobs in March and April, so about 42% of those jobs were added back in May and June. However, these are the jobs most susceptible to a surge in COVID infections, and leisure and hospitality will likely be under pressure in July.Earlier: June Employment Report: 4.8 Million Jobs Added, 11.1% Unemployment Rate. In June, the year-over-year employment change was minus 13 million jobs.One of the keys to follow will be the number of workers on temporary layoff.   This increased from 801 thousand in February, to 1.848 million in March, and to 18.063 million in April. This decreased  in May to 15.343 million, and decreased further in June to 10.565 million.Meanwhile permanent job losers increased in June to 2.883 million from 2.295 million in May.Since the overall participation rate has declined due to cyclical (recession) and demographic (aging population, younger people staying in school) reasons, here is the employment-population ratio for the key working age group: 25 to 54 years old.The prime working age will be key in the eventual recovery.The 25 to 54 participation rate increased in June to 81.5%, and the 25 to 54 employment population ratio increased to 73.5%. The number of persons working part time for economic reasons decreased in June to 9.062 million from 10.633 million in May.These workers are included in the alternate measure of labor underutilization (U-6) that decreased to 18.0% in June. This is down from the record high in April 22.8% (and down from 21.2% in May) for this measure since 1994. The previous peak was 17.2% during the Great Recession.  This graph shows the number of workers unemployed for 27 weeks or more. According to the BLS, there are 1.391 million workers who have been unemployed for more than 26 weeks and still want a job. This will increase sharply in 3 or 4 months, and will be a key measure to follow during the recovery. Summary: The headline monthly jobs number was well above expectations and the previous two months were revised up 90,000 combined.  The headline unemployment rate decreased to 11.1% .Last month I noted that the "reopenings" would be a June story, and that is what this report suggests.  In addition, companies using PPP had to rehire employees to convert the loans to a grants.  Unfortunately, the surge in virus infections and related closures, will probably negatively impact the July report.  In addition, we will probably start to see more PPP related layoffs.As a reminder, the course of the economy will be determined by the course of the pandemic.

Nearly 11% of the workforce is out of work with zero chance of getting called back to a prior jobEPI - Key takeaways:

  • In May, the official unemployment rate was 13.3%. However, the unemployment rate that takes into account all those who are out of work as a result of the virus was 19.7%, and the unemployment rate that includes only those who are out of work and don’t have a reasonable chance of being called back to a prior job was 10.7%.
    • The official unemployment rate was 13.3% in May. However, if you consider not just the 21.0 million officially unemployed, but all 32.5 million workers who are either officially unemployed or otherwise out of work as a result of the virus, that jumps to 19.7%. That is nearly one in five workers.
    • Of the 32.5 million workers who are either officially unemployed or otherwise out of work because of the virus, 11.9 million workers, or 7.2% of the workforce, are out of work with no hope of being called back to a prior job; 5.7 million workers, or 3.5% of the workforce, are out of work and expect to get called back to a prior job but likely will not; and 14.8 million workers, or 9.0% of the workforce, are out of work and can reasonably expect to be called back. That means the share of the workforce that is out of work and has no reasonable chance of being called back to a prior job is 10.7% (7.2% + 3.5%).
  • All three of these unemployment rates are extremely elevated across all demographic groups. However, the highest rates are found among Black and brown workers, women, and particularly Hispanic, Asian, and Black women. Young workers and workers with lower levels of education have also been hit disproportionately hard.
  • It is important to note that the prospect of even those who can reasonably expect to be called back to a prior job actually getting called back will require Congress to act. For example, if Congress doesn’t extend the extra $600 in weekly unemployment insurance payments, that will cost us 5.1 million jobs over the next year, and if it doesn’t provide fiscal aid to state and local governments to fill in their budget shortfalls, it will cost another 5.3 million jobs by the end of 2021.

In May, the unemployment rate declined to 13.3% from 14.7% in April. That improvement was welcome news, but aside from April, the 13.3% unemployment rate in May was higher than anything we’ve seen since the Great Depression. And, the unemployment rate is not reflecting all coronavirus-related job losses. In May, 21 million workers were counted as officially unemployed. But there were another 4.9 million workers who were out of work because of the virus but who were being misclassified—they had been furloughed and should have been counted as unemployed and on temporary layoff, but were instead counted as “employed but not at work.” If those workers had been correctly counted as being on furlough instead of employed, the unemployment rate would have been 16.4% in May instead of 13.3%.Another group of workers who are left out of the official unemployment rate are those who are out of work as a result of the virus but are not actively seeking work. As is always the case, for a jobless worker who is not on furlough to be counted as unemployed, they must be actively seeking work. Today, that remains impossible for many. I estimate that in May, there were 6.6 million workers who were out of work as a result of the virus but who were being counted as dropping out of the labor force because they weren’t actively seeking work.

 Los Angeles Hit Hard by Implosion of Freelance Work -- Yves Smith - Those long enough in tooth to have been working in the later 1990s may remember the hyping of going freelance. The growth of the gig economy precariat has tarnished that allure, but there was a large contingent of high-end, high-skill workers who either went from project to project or had their own clientele and now are in diminished to desperate straits. A new Wall Street Journal story focuses on Los Angeles as the city hardest hit by this unwind, due particularly to the prevalence of short-term, well-paid work in creative professions related to film, commercial, and TV production, as well as less top-of-mind fields such as hospitality and international trade. Another group laid low are personal service professionals, such as fitness trainers, voice and music coaches, and tutors.  An irony is that tech, which is riding high now, went through a bust like this in the dot-bomb era. Even consulting firms like McKinsey, which had gotten so addled on the Internet revolution that they bulked up and even took equity in lieu of fees (leading to hundreds of millions in writedowns) wound up shrinking its staffing in North America by nearly 50% over a two-year period. And while big firm consulting and tech recovered from this downdraft, it’s an open question as to how long it will take to get effective coronavirus vaccines and treatments, and in the meantime, how much of this formerly vibrant freelance activity can come back in this strained new normal. Even though the proportion of “skilled independent” workers is a smidge higher in San Francisco than in Los Angeles, both around 6%, San Francisco’s freelance elite skews towards tech. Miami, Austin, and New York are next, all coming in above 5%. California is taking advantage of Federal emergency program provisions that allow states to provide unemployment benefits to gig/freelance workers, as much as $450 weekly through year end. That means they also receive the Federal $600 per week supplement through the end of this month.  Los Angeles has gotten a double whammy by having the second highest number of Covid-19 cases in the US, despite  its famed sprawl, and seeing a recent spike in new infections. And as the Wall Street Journal story recounts, Los Angeles’ recent limited reopening hasn’t led to much if any rebound in business for these freelance pros. That confirms a pattern we’ve described repeatedly: consumers restricting their activities is much more driven by their perception of risk, which is driven by factors like local Covid-19 death counts,  than government intervention.

U.S. farmers scramble for help as COVID-19 scuttles immigrant workforce (Reuters) - The novel coronavirus delayed the arrival of seasonal immigrants who normally help harvest U.S. wheat, leaving farmers to depend on high school students, school bus drivers, laid-off oilfield workers and others to run machines that bring in the crop. As combines work their way north from the Southern Plains of Texas and Oklahoma, farmers and harvesting companies are having a hard time finding and keeping workers. Any delays in the harvest could send wheat prices higher and cause a scramble to secure supplies to make bread and pasta. The United States is the world’s No. 3 exporter of wheat, a crop in high demand during the pandemic. A sustained labor shortage could impact the soy and corn harvests that start in September. Harvesting companies and farmers interviewed by Reuters said their new U.S. employees have required more training and quit at higher rates than usual, as the combines head north and begin to bring in other major export crops. While grain harvests are more automated than the labor-intensive fruit and vegetable industries, they are not immune to labor shortages. Josh Beckley of Beckley Harvesting Inc, based in Atwood, Kansas, typically counts on migrants for about 30% of his workers. The most common visa for migrant agriculture workers is the H-2A, which allows workers to stay in the United States for months at a time to work on farms. This year, Beckley had no foreign laborers on his crew. He has struggled to find replacement workers, with many Americans unwilling to sign up for months of traveling through the U.S. farm belt.

Just when it seemed safe to go back to restaurants a new coronavirus outbreak threatens U.S. jobs recovery The U.S. got some great news Thursday with the rehiring of 4.9 million people in June, but the two steps forward the economy took in May and June could be followed by one step back in July. The problem? A resurgence in coronavirus cases, especially in states that allowed their economies to reopen early, is leading to renewed restrictions on businesses and consumers. At the epicenter of the resurgence in the coronavirus epidemic is the restaurant industry. The reopening of restaurants led to the return of some 3 million workers in May and June, accounting for 40% of the jobs the U.S. has regained since the onslaught of the coronavirus. That’s the good news. The bad news? Many of the people rehired could be laid off a second time if more states place inside dining off limits again or pause plans to loosen restrictions. California, Florida, Texas and other states have tightened restrictions after a fresh outbreak of COVID-19 cases while others such as New York and New Jersey have delayed plans to allow inside dining. In California, restaurants in 19 counties were told to cease indoor dining for at least three weeks. The slowdown in rehiring at bars and restaurants could put a big dent in U.S. employment growth in July if the fresh viral outbreaks are not brought under control soon, economists say. Eating and drinking establishments accounted for the bulk of the 7.5 million jobs the economy recovered in the past two months. Yet restaurants still employed about 3 million fewer people at the start of July than they did before the crisis — a whopping 50% reduction. And the recent outbreak of coronavirus cases means many of those jobs probably aren’t coming back soon.

CDC director: 'Substantial disappointment' with American Airlines filling planes to capacity - Centers for Disease Control and Prevention Director Robert Redfield at a congressional hearing on Tuesday expressed "substantial disappointment" with American Airlines for its new policy of filling its planes to capacity despite the coronavirus. Redfield said under questioning from Sen. Bernie Sanders (I-Vt.), that American Airlines' new policy, announced on Friday, contrasts with other airlines that had allowed middle seats to remain open to increase distance between passengers to help limit the spread of the virus. "I can tell you that when they announced that the other day, obviously there was substantial disappointment with American Airlines," Redfield said at a Senate Health Committee hearing. "A number of the airlines had decided to keep the middle seat [open]." American Airlines' new policy of filling its planes to capacity will begin on Wednesday. The airline did say it would notify passengers and allow them to move to more open flights when available, at no extra cost. In contrast, Delta Air Lines is capping capacity at about 60 percent and Southwest Airlines at about 67 percent, according to the Associated Press. The policy of United Airlines matches American's. Sanders told Redfield that he hopes the CDC or another government agency orders the airlines and other travel companies to ensure that there is distance between passengers. "I just hope very much that the CDC or the appropriate agency basically tells these companies that that is unacceptable behavior," Sanders said. "They're endangering the lives of the American people." Airlines for America, which represents and advocates for the major U.S. airlines, defended American's new policy on Tuesday.  “You can’t social distance on an airplane. We believe there are safety measures in place on a multi-level basis that makes flying safe, in fact safer than many other activities,”

Atlanta airport closes main TSA checkpoint after worker tests positive - Atlanta Hartsfield-Jackson International Airport, the world's busiest, closed its main security checkpoint Wednesday after a screener tested positive for the coronavirus. According to Mark Howell, a Transportation Security Administration spokesman, the employee last worked Tuesday from 3:30 a.m. to noon. Employees who worked with the screener were notified. All passengers are being directed to the airport's north checkpoint, Howell said. The wait times Wednesday afternoon for the checkpoint were running 30 to 45 minutes, according to the airport's website. "Obviously, it’s backed up." Howell said. "It’s a smaller checkpoint." Howell said the main checkpoint is being thoroughly cleaned and could reopen as soon as Wednesday night. He said it would be open again Thursday "for sure." Howell said the airport projects 27,000 passengers Thursday and Friday ahead of the July 4 holiday, up from a daily average of 20,000 in recent weeks. Nationwide, air travel remains down because of the coronavirus pandemic. More than 860 TSA employees nationwide have tested positive for the coronavirus since February, including 29 in Atlanta. Five TSA employees have died nationwide.

Governors rethink opening bars, restaurants amid spike in COVID-19 cases  - State and local officials are facing pressure to keep bars and indoor dining closed as the U.S. reckons with another upswing in COVID-19 infections weeks after lockdown measures were lifted. Indoor venues where people eat, drink and socialize have become sources of COVID-19 spread in several states where cases are rising, forcing leaders to reevaluate their decisions to allow bars and indoor restaurants to reopen during a pandemic. Meanwhile, governors who have not yet allowed those facilities to reopen said they will reconsider their plans to do so. “I think across all these states, we just can’t have bars — I’m not sure that we can even run restaurants where people are sitting indoors, nightclubs. Anything that gathers people indoors I think at this moment is way too risky and has to be dialed back,” said Ashish Jha, professor of global health at the Harvard T.H. Chan School of Public Health, on NBC’s “Today” on Monday. The U.S. is facing an upswing of COVID-19 cases, especially among young adults in the South and West, that threatens to overwhelm hospitals in some states. Experts have pinned the rise in cases to states that reopened too early without having adequate testing or contact tracing to quickly spot new outbreaks and people not following social distancing measures, such as staying six feet away from others and wearing masks in public. Governors in Texas, Florida and California, where new cases are increasing rapidly, have mandated bar closures in recent days, and other governors are likely weighing whether they will do the same. On Monday evening, Arizona Gov. Doug Ducey (R) announced that bars, nightclubs, gyms, movie theaters and water parks will close for 30 days due to the state's spike in COVID-19 cases. Bars and indoor restaurants still remain open in much of the country, including in other states seeing rises in cases, Georgia, Louisiana, South Carolina, Nevada and most counties in Pennsylvania. Indoor areas where people congregate, such as nursing homes and prisons, have been hot spots for infection since the early days of the pandemic.  “With packed indoor bars, people not wearing masks standing next to each other for extended periods of time, and it’s loud so they’re talking loudly — that’s a great way to spread the virus, unfortunately,” she added. While many states require that bars and other indoor establishments follow social distancing rules to prevent crowding, they are not always followed by patrons, and COVID-19 cases have been tied to establishments in several states.

 LA Orders Closure Of Beaches For July 4th Weekend, Sheriff Refuses To Enforce Ban -  - The closure of Los Angeles beaches over July 4 weekend was ordered by county officials Monday “to prevent dangerous crowding,” as confirmed cases of COVID-19 continue to rise.  The county’s public health department said in a statement that beaches will be off limits to the public from July 3 through July 6 at 5 a.m. to prevent the transmission of “deadly COVID-19,” the disease caused by the CCP (Chinese Communist Party) virus. Fireworks displays in the county will also be prohibited over the July 4th holiday weekend, the department announced. The news came as LA county reported more than 2,900 additional cases of the CCP virus on Monday, marking “the single largest one-day case count since the pandemic began,” the department said. “Data show increases in people testing positive for the virus and increases in hospitalizations as a result,” it said. “Projections by the Department of Health Services show a marked increase in hospitalizations in the coming weeks, which could cause a surge in our healthcare system.”  Barbara Ferrer, the county’s director of public health, said in a statement that closing the beaches and prohibiting fireworks displays during such an “important” summer holiday was an “incredibly difficult decision to make.” “But it’s the responsible decision to protect public health and protect our residents from a deadly virus,” Ferrer said. “The Fourth of July holiday weekend typically means large crowds and gatherings to celebrate, a recipe for increased transmission of COVID-19.”  According to Fox News, Los Angeles County Sheriff Alex Villanueva has said he will not be enforcing the order to shut beaches over the holiday weekend, saying that he had not been consulted prior to the announcement.  “We were not consulted on the beach closure, and will only assist our beach cities in closing parking lots and traffic enforcement on PCH,” Villanueva told Fox 11.  “In regards to enforcing the beach closure, we will not be enforcing it because we are ‘Care First, Jail Last.'”

Commission Issues Order To Regulated Utilities To Suspend Service Disconnections - During a special conference Monday, the Tennessee Public Utility Commission ordered private-investor owned natural gas, electric, water, and wastewater utility companies to continue to suspend the disconnection of utility services due to nonpayment until the Commission’s next conference scheduled for Aug. 10. In view of the COVID-19 epidemic, the Commission’s order recognizes the challenges customers and businesses face as Tennessee businesses transition to reopening safely, while concurrently acknowledging the need to transition from the suspension of utility service shut offs to an environment of normalcy for both customers and utilities. “We certainly understand the challenges facing consumers who rely on public utility services,” said Tennessee Public Utility Commission Chair, Robin L. Morrison. “But as our state transitions into its new normal, we must begin to look forward to the near future with an understanding that suspensions of service cut offs is not a long-term solution.” The Commission’s Order invites the utilities under its regulatory oversight to file comments with the Commission on the impact of suspensions to its business operations and any relevant transitional proposals to service cut offs by July 15. "To be clear, we recognize that there can be no one-size-fits-all policy that encompasses the entirety of a public utility’s operations or the challenges faced by its customers," said Chair Morrison. "So before we move to eliminate and lift the suspension of cut offs, more information would be of great value to the Commission.

PG&E exits bankruptcy as Newsom approves corporate overhaul option - PG&E Corp. exited bankruptcy on Wednesday, one day after Gov. Gavin Newsom authorized a new law paving the way for the state to radically restructure the company if it fails to rehabilitate itself.The company said it has emerged from Chapter 11 bankruptcy protection after implementing the financial restructuring plan that was previously approved in court and by state regulators. As part of that process, PG&E has provided about $5.4 billion in initial funds to pay wildfire victims.PG&E’s restructuring plan creates a trust to compensate fire victims that is supposed to be worth an estimated $13.5 billion. But the actual value that the trust will reach is still not clear because half of the price tag is coming through PG&E shares that the trust will sell off over time.PG&E said it has also seated its post-bankruptcy board of directors that consists of 14 members, 11 of whom are new. And the company has funded $12 billion in settlements over the wildfire claims of insurers and local governments.In a statement, interim CEO Bill Smith said he was glad to start funding the victims’ trust to quickly pay people who survived recent PG&E-caused fires.“This is an important milestone, but our work is far from over,” he said. “Our emergence from Chapter 11 marks just the beginning of PG&E’s next era — as a fundamentally improved company and the safe, reliable utility that our customers, communities and California deserve.” PG&E’s bankruptcy exit came after Newsom on Tuesday signed SB350, a bill through which the state could someday transform investor-owned PG&E into a nonprofit public benefit corporation named Golden State Energy.Sponsored by state Sen. Jerry Hill, D-San Mateo, SB350 is intended to provide the state with assurances about what will happen if PG&E’s Chapter 11 restructuring does not prevent the company from starting more fires like those that led to its bankruptcy. The state Senate approved the bill on Monday, about two weeks after it cleared the Assembly.The corporate overhaul enabled by SB350 would occur if state regulators decide to revoke PG&E’s operating license — a drastic step they will consider taking if the company continues to cause major disasters.“No more business as usual for PG&E,” Newsom said in a statement. “As we head into wildfire season amid a pandemic, Californians need to have confidence that their utility is focused on customer safety — preventing wildfire sparks and making critical safety upgrades.”2

 Detroit Police SUV plows through protesters, several injured - A police SUV plowed through a crowd of anti-police violence protesters in Detroit Sunday night, injuring several people. The attack was caught on video, posted to social media, which shows protesters screaming as the vehicle pushed violently though the crowd, throwing people to the ground. The police officer driver braked and then accelerated repeatedly to throw protesters off his vehicle’s bumper. The vehicle then took off at high speed with a man still on the hood. Twenty-four-year-old protester Jae Bass told the Detroit Free Press, “He just floored it. He went super fast. We went flying off. He ran over a couple people’s arms, feet.” Democratic Mayor Mike Duggan defended the officers involved in the attack, saying in an interview with WDET that Detroit police support the right to free speech. This comes less than a month after several journalists were physically harmed by police in Detroit in the first weekend of protests over the murder of George Floyd, getting pepper sprayed, arrested and shot by pepper balls and rubber bullets. Detroit Police Chief James Craig also defended the officers involved, saying no immediate actions would be taken as “aggressors were targeting police.” He claimed protesters were armed with hammers, and the police thought they were being fired upon. This is countered by reports from people who were at the scene.  This incident is the latest in a series of attacks by police using their vehicles as deadly weapons against protesters. On May 30 two NYPD SUVs drove through a crowd of protesters in Brooklyn. Democratic Mayor Bill de Blasio defended the officers and blamed the protesters. On June 1 a police SUV drove through a crowd in San Diego, California. InRichmond, Virginia, Police Chief Will Smith resigned after a police SUV drove through a crowd of protesters on June 13. Several people were struck but no one was injured. There have also been at least 19 reports of civilians using vehicles as a weapon against protesters since the demonstrations began in May.

NYC teachers union calls De Blasio’s plan to reopen schools premature - The United Federation of Teachers is saying Mayor Bill de Blasio’s proclamation that New York City’s schools will reopen for in-person learning in September is premature. Speaking to Good Day New York, UFT President Michael Mulgrew expressed his concerns, ranging from school capacity given social distancing, to childcare for teachers who are parents, accusing City Hall of refusing to discuss the issues and saying the union does not see a way for all of the city’s 1.1 million school children to fit in classrooms in the fall. The leader of the New York City teacher's union says Mayor Bill de Blasio was premature in suggesting public schools would reopen in the fall.  “We have asked City Hall, the two things we said, you don’t want to engage in how we set up schools, fine, but you need to address this childcare crisis and a nurse in every building, and those are the two things we’ve asked City Hall to address and they have been silent on both of them,” Mulgrew said.  The city says officials are already in the process of calculating the maximum number of children to be allowed in each building given social distancing requirements. The city is also planning for deep cleanings, mandating the constant use of face masks, and setting up sanitizing stations. New York City Mayor Bill de Blasio says that New York City's schools will reopen in September, but Governor Andrew Cuomo is pushing back, saying the final decision rests with the state. Mayor De Blasio says he’s aware of the logistical challenge for a school system that was already overcrowded before the pandemic, but that it’s what NYC parents want, so it needs to be done. “The DoE did a survey of parents and they got 400,000 responses,” De Blasio said. “75 percent of our New York City public school parents want to send their kids back to school in September.” Any decision about opening schools, however, ultimately lies in the hands of Governor Andrew Cuomo, who has made clear that this is not a decision he is ready to make yet.

Mandatory masks, guidelines for reopening Ohio schools -  Ohio Gov. Mike DeWine unveiled his plans for reopening K-12 schools in the fall amid the coronavirus pandemic. He made the announcements during his news conference on Thursday.He said he believes there is a consensus among teachers, school administrators and parents that kids need to be back in school buildings. He said there will be a balance of local control and state interest.While teachers/students did outstanding w/ distance learning, @AmerAcadPeds strongly recommends students be physically present in school as much as possible. To keep schools open, our guidelines are designed to create the safest environment possible for our students and staff.— Governor Mike DeWine (@GovMikeDeWine) July 2, 2020He released five guidelines for reopening that include: vigilantly assessing symptoms at home, washing and sanitizing hands, practicing social distancing, thoroughly cleaning the school environment, and implementing a face covering policy. More information will be available later on the state’s website.

Wake County Public School System three-week rotation reopening plan spells trouble for some parents - -- During a virtual meeting on Thursday, Wake County Public School System unanimously agreed to reopen schools with students operating on a three-week rotation schedule. A plan that has many parents trying to figure out how they will make that work with their own schedules.Under 'Plan B' to get students back to the classrooms, students would have in-person learning for one week and online instruction for two weeks. Natalie Lee, a single mother of two elementary-aged children in Garner, says she, like many other parents, powered through the remote learning and working during quarantine. Now she is wondering how she is going to juggle the new schedule.  "The parents were doing the bulk of that teaching and while I have a degree I'm definitely not a teacher and my fear is that they'll continue to fall behind," said Lee. Lee is afraid the new one week on two weeks off schedule could prove itself to be costly, especially, when it comes to finding care for her children. But the impact to her kids goes deeper than pockets, it's about development." It's important that they learn how to be around other kids so they learn that behavior," said Lee.She finds herself to be very fond of Durham Public School's opening plan. The public school system plans to keep their high schoolers home to free up space for smaller children.

Schools reopening: Covid-19 keeps putting the new school year in total limbo - Coronavirus is surging around the country just as many school districts are trying to finalize what classes will look like for 56 million students in the new academic year.A month ago, many states were opening up. Now they're pausing or even rolling back. The uncertainty of how and where the virus will move is forcing schools to make multiple plans so they can stay flexible just a few weeks before the start of the 2020-21 year.  Arizona Gov. Doug Ducey has pushed its start date for in-person schools back to August 17 as it emerges as one of the current hotspots, but that doesn't solve things for the state's Superintendent of Public Instruction, Kathy Hoffman. "What Arizona's numbers will look like by August 17th remains unclear," Hoffman tweeted. "But one thing is for certain: if efforts are not taken across the entire state to curb the spread of this virus, our schools will only continue to face complications in re-opening their facilities." In California, State Superintendent Tony Thurmond is also watching the spikes as he makes plans for his 6.2 million students and 360,000 teachers. "We'll be ready for either scenario: in-person or staying in distance learning," he told CNN.  That kind of flexibility is supported by experts including Dr. Anthony Fauci, director of the National Institute for Allergy and Infectious Diseases, who on Tuesday called for states to not rush through reopening protocols."It really will depend on the dynamics of the outbreak in the particular location where the school is," he told Sen. Lamar Alexander when asked what his advice to school superintendents would be. He said the goal was always to have in-person education, but there had to be options. "Always make the goal that it is very important to get the children back to school for the unintended negative consequences that occur when we keep them out of school," he said.

'How the hell are we going to do this?' The panic over reopening schools - Pediatricians say schools should strive to bring kids back to classrooms. Teachers unions are on the verge of revolt, in fear of infections. Local school districts are struggling with everything from technology to staging schools for socially distanced learning. And Education Secretary Betsy DeVos is largely on the sidelines, saying the coronavirus back-to-school planning is a state and local issue. No wonder parents across America are freaking out.The CDC issued additional guidance this week on safely reopening schools, with infections spiking in the South and West. Some education leaders fear the guidelines are being disregarded, casting doubt anew on how the new school year will even be able to launch. Yet the beginning of the school year is nearing and worried parents are wondering if they will be able to count on in-person classes resuming by the time they must return to work, inextricably tying school reopenings to the revival of the economy.In Virginia, Fairfax County’s teachers unions say teachers aren’t comfortable returning to schools and are encouraging members to state their preference for online learning until more information about face-to-face instruction is available. In Texas, the governor is now requiring face masks in public spaces in counties with 20 or more Covid-19 cases — but his order didn't mention schools. Arizona has delayed schools’ reopening date until mid-August as cases surge.From social distancing to health checks, the list of concerns is seemingly endless as school districts draft their plans, many of which are still in the development stages. Those concerns are only intensifying as Covid-19 cases begin to skyrocket."There are no plans for most of these places,” said Lily Eskelsen García, president of the National Education Association, the nation’s largest union. “People are panicked and parents should be panicked.” Teachers increasingly are on edge and leaning on unions for help. “I'm being bombarded with, ‘How the hell are we going to do this?’” said Eskelsen García. “We're worried that school districts will give in to a politician or some business that wants their workers freed up to come back and work in a factory somewhere, and that then they will be forced to open unsafe schools.”

Supreme Court school voucher ruling threatens American unity and public education -  The Supreme Court’s decision in Espinoza v. Montana Department of Revenue could drive a value shift far more important and troubling than its narrow practical effect. The ruling demands that Montana allow private religious schools to participate in its school voucher program. But for most states, the decision is currently irrelevant. About half of the states do not fund private school tuition. Many of those that do already fund private religious education. Espinoza’s primary impact is to hand an enormous symbolic victory to those with a goal beyond religious education — a goal of shrinking public education and replacing it with government-funded private school choice. … The second problem is what vouchers validate. They bless a retreat into isolated political, religious, socioeconomic, and racial corners. Private schools enroll a predominantly white, wealthy, and Christian student population. In most states, private schools enroll students whose families are 50% to 90% richer than their public school counterparts. Private schools also enroll only half as many students of color. And 78% of these private schools are religious. .. Voucher programs do little to challenge these trends. Less than one in three voucher programs protects students from religious, disability, gender, or sexual orientation discrimination. Only half protect students from race discrimination. ..To be sure, public schools suffer their own failings, but the law expects better of them, prohibiting these forms of discrimination and more. Public schools are the one institution designed to bring us together, making one out of many. As my forthcoming book "Schoolhouse Burning: Public Education and the Assault on American Democracy" details, public schools have been a central component of the American promise to transform government from one dominated by elite white males to one shared by all.  Before the U.S. Constitution was even drafted, our founding fathers were calling for public education to ensure that our radical new form of government — one that gave power to the common man — would not self-implode. John Adams, for instance, called for publicly funded public schools that would educate “every rank and class of people, down to the lowest and the poorest,” something so grand “that [it] never yet has been practiced in any age or nation.” He even put that promise in the Massachusetts Constitution — a forerunner to the national one.

 Education 101: Don’t Open a New Charter School in the Middle of a Pandemic --While sheltering with her family during the pandemic, dealing with the challenges of remote learning, Michelle Tomlinson couldn’t help but notice in her social media channels the growing frequency of charter school advertising. One ad led to a video of Jonathan Hage, CEO of Charter Schools USA, a national charter school chain with numerous schools in North Carolina. The ad claimed the company’s facilities “are ready and will be open for the new school year” without referring to North Carolina state guidelines for reopening schools safely in the wake of COVID-19. She was further annoyed by a local news outlet reporting a positive story about local charter schools successfully pivoting from in-person teaching to online instruction without mentioning charter schools often enroll more well-off students whose parents are more likely to own laptops, tablets, and computers and have high-speed Wi-Fi connections to the internet. Many North Carolina charter schools serve so few high-poverty students they were in danger of being disqualified to receive emergency aid from the Coronavirus Aid, Relief, and Economic Security (CARES) Act. However, U.S. Secretary of Education Betsy DeVos announced new guidelines in May that would ensure new charter schools and charter schools that claim they are going to take in more high-poverty students would qualify to receive CARES money.Tomlinson also knew well the financial impact the new charter schools would have at a time when public schools in North Carolina, and all other states, are bracing for deep cuts in funding due to the economic fallout of the coronavirus. North Carolina state funding levels face a potential $1.6 billion shortfall in the coming year, according to the National Conference of State Legislatures. Tomlinson was not alone among Wake County parents who have been worried about new charters opening in their communities during a time of crisis.  The parents’ concerns included weak demand for the charters and the likelihood that the influx of charters will cause traffic problems, inject profiteers into the school community, and exacerbate racial and economic segregation in the school system. The campaign has generated more than 875 signatures, as of this writing. Wake County is not an isolated case; across the country, parents are concerned about charter schools taking a bigger bite out of a public education pie that will likely be smaller due to the economic impact of COVID-19. Because reopening public schools in the coming school year will be fraught with unprecedented challenges, experts say, and education budgets may get cut to the bone, news of charter school startups and expansions will undoubtedly spark heated opposition from public school parents and teachers, even in well-to-do suburban communities, like Wake County, that may have been insulated from the financial costs of school choice in the past.

Richest Liberal Arts School In US Slashes Tuition By 15%, Cancels Athletics Program -   The richest liberal arts university in the country, Williams College, has slashed tuition by 15% "in recognition of the extraordinary circumstances and of this academic year and the uncertainty we face in the year ahead," according to Bloomberg.   Williams, which has a $2.9 billion endowment (as of June, 2019) will also be canceling sports competitions and travel for the season according to a Monday statement. For the 2020-2021 academic year, Tuition, room and board will set back rich parents and lending institutions $63,200. Of note, four years at the university will set one back more than the average mortgage balance carried by millennials. "This reduction recognizes the fact that the pandemic and associated challenges are requiring us to cancel winter study as well as fall athletics competition and many student activities, among other opportunities that we usually encourage families to expect as part of their student’s education," said school President Maud Mandel. Schools across the U.S. are coping with uncertainty for the year that begins in August or September as it’s largely unclear whether in-person courses will be offered given the rise in Covid-19 cases. Students at dozens of schools have already balked at the full price for last semester’s tuition with months of online classes, suing for billions of dollars in refunds. –Bloomberg "In higher education, we’re trained to believe that expensive is good," says Seton Hall University associate professor Robert Kelchen. "Now, in this economic crisis, families are more price-sensitive than they have been." Other colleges have made similar moves - including Davidson College in North Carolina, which announced in April that families would be allowed to postpone payments until August of 2021, and the College of William & Mary, which announced last month that incoming in-state undergraduates would no longer be subject to a tuition increase.

Colleges Are Reopening in Fall, But Many Professors Won’t Be Present -  College students across the country have been warned that campus life will look drastically different in the fall, with temperature checks at academic buildings, masks in half-empty lecture halls and maybe no football games. What they might not expect: a lack of professors in the classroom.Thousands of instructors at American colleges and universities have told administrators in recent days that they are unwilling to resume in-person classes because of the pandemic. More than three-quarters of colleges and universities have decided students can return to campus this fall. But they face a growing faculty revolt. “Until there’s a vaccine, I’m not setting foot on campus,” said Dana Ward, 70, an emeritus professor of political studies at Pitzer College in Claremont, Calif., who teaches a class in anarchist history and thought. “Going into the classroom is like playing Russian roulette.”This comes as major outbreaks have hit college towns this summer, spread by partying students and practicing athletes.In an indication of how fluid the situation is, the University of Southern California said late Wednesday that “an alarming spike in coronavirus cases” had prompted it to reverse an earlier decision to encourage attending classes in person.With more than a month before schools start reopening, it is hard to predict how many professors will refuse to teach face to face in the fall. But schools and professors are planning ahead.A Cornell University survey of its faculty found that about one-third were “not interested in teaching classes in person,” one-third were “open to doing it if conditions were deemed to be safe,” and about one-third were “willing and anxious to teach in person,” said Michael Kotlikoff, Cornell’s provost. Faculty members at institutions including Penn State, the University of Illinois, Notre Dame and the State University of New York have signed petitions complaining that they are not being consulted and are being pushed back into classrooms too fast. “I shudder at the prospect of teaching in a room filled with asymptomatic superspreaders,” wrote Paul M. Kellermann, 62, an English professor at Penn State, in an essay for Esquire magazine, proclaiming that “1,000 of my colleagues agree.” Those colleagues have demanded that the university give them a choice of doing their jobs online or in person.

University of Michigan Flint cuts 41 percent of lecturers -- Nearly 41 percent of lecturers at the University of Michigan Flint have been laid off since the university reported an $8.4 million budget shortfall. Jennifer Hogan, a university spokeswoman, recently left a comment for a local NBC affiliate, stating, “The pandemic has now exacerbated the situation and the university is preparing for a fiscal year 2020/2021 shortfall… requiring significant budget cuts.” The university has also suffered a steady decline in enrollment, which has increased the financial pressure on it. Hogan explained that the cuts include salary reductions, voluntary furloughs impacting 16 percent of staff, reorganization of administration departments and layoffs of administrative staff, cancellation of certain contracts and projects, and a spending and hiring freeze. Thirteen percent of the staff cuts are full layoffs and 7 percent are non-reappointments.  The cutting of lecturers at U-M Flint by almost 41 percent will have severe consequences for the university. Laura MacIntyre, a lecturer in the sociology department and resident of Flint, stated, “We were already in a precarious position. The horrible conditions that already exist are being exacerbated.” MacIntyre continued, “Even with a union, we have sh*tty working conditions. We’re supposed to have one of the best contracts in the country, so what does this mean for other lecturers in other parts of the United States?” MacIntyre is considered partially laid off. Her contract is 50 percent, which means she has a 50/50 chance of employment. “I was not offered any classes for the spring or summer semester, and I have a feeling that my fall classes will be canceled,” she said. Explaining the use of the term “lecturer” at U-M Flint, she continued: “In another system we would be called ‘adjuncts.’ The lecturer designation is 1984 double-speak.” When asked about her income from teaching at the university, MacIntyre said, “It’s very hard to know what my income will be because of the cancellation policy, which was there before the pandemic. Last year I made $18,000, and that included the $10,000 increase the union got us. I actually qualify for food stamps and Medicaid, so with this job, I’m living in poverty.”

UMass Nursing Dean Fired For Saying "Everyone's Life Matters" - As a blog dedicated to free speech, it has been difficult to keep up with the rising number of cases of the curtailment of speech or academic freedom on our campuses.  What is equally alarming is the relative silence of most faculty members as individual professors are publicly denounced by their universities, forced into retirement, or outright terminated for expressing dissenting views.  This case however raises an equally serious concern over the loss of due process for academics who find themselves the focus of a campaign for removal — or simply summary dismissal. Dr. Neal-Boylan was heralded last September as a “visionary leader” by the university in taking over the deanship.  Her writings include strong advocacy for those with disabilities in the nursing field. Those writings show tremendous empathy and concern for inclusivity in the profession. This controversy began when Dr. Neal-Boylan wrote the email which started with the following words: “I am writing to express my concern and condemnation of the recent (and past) acts of violence against people of color. Recent events recall a tragic history of racism and bias that continue to thrive in this country. I despair for our future as a nation if we do not stand up against violence against anyone. BLACK LIVES MATTER, but also, EVERYONE’S LIFE MATTERS. No one should have to live in fear that they will be targeted for how they look or what they believe.” One can understand that many felt that the statement detracted from the need to focus on the treatment and loss of black lives. However, one can also read these words as a nursing dean expressing opposition to all violence. However, the email was immediately denounced in a tweet as “uncalled for” and “upsetting” by “Haley.”  The university quickly responded to Haley and said “Haley – Thank you for bringing this to our attention. The university hears you and we believe black lives matter. See the letter the chancellor sent out Monday.”  The letter is a statement in support of Black Lives Matter.  Soon thereafter the University reportedly fired Dr. Neal-Boylan.

On “White Fragility” – Taibbi - A core principle of the academic movement that shot through elite schools in America since the early nineties was the view that individual rights, humanism, and the democratic process are all just stalking-horses for white supremacy. The concept, as articulated in books like former corporate consultant Robin DiAngelo’s White Fragility (Amazon’s #1 seller!) reduces everything, even the smallest and most innocent human interactions, to racial power contests. It’s been mind-boggling to watch White Fragility celebrated in recent weeks. When it surged past a Hunger Games book on bestseller lists, USA Today cheered, “American readers are more interested in combatting racism than in literary escapism.” When DiAngelo appeared on The Tonight Show, Jimmy Fallon gushed, “I know… everyone wants to talk to you right now!” White Fragility has been pitched as an uncontroversial road-map for fighting racism, at a time when after the murder of George Floyd Americans are suddenly (and appropriately) interested in doing just that. Except this isn’t a straightforward book about examining one’s own prejudices. Have the people hyping this impressively crazy book actually read it? DiAngelo isn’t the first person to make a buck pushing tricked-up pseudo-intellectual horseshit as corporate wisdom, but she might be the first to do it selling Hitlerian race theory. White Fragility has a simple message: there is no such thing as a universal human experience, and we are defined not by our individual personalities or moral choices, but only by our racial category. If your category is “white,” bad news: you have no identity apart from your participation in white supremacy (“Anti-blackness is foundational to our very identities… Whiteness has always been predicated on blackness”), which naturally means “a positive white identity is an impossible goal.” DiAngelo instructs us there is nothing to be done here, except “strive to be less white.” To deny this theory, or to have the effrontery to sneak away from the tedium of DiAngelo’s lecturing – what she describes as “leaving the stress-inducing situation” – is to affirm her conception of white supremacy. This intellectual equivalent of the “ordeal by water” (if you float, you’re a witch) is orthodoxy across much of academia.

 How hackers extorted $1.14m from University of California, San Francisco - BBC - A leading medical-research institution working on a cure for Covid-19 has admitted it paid hackers a $1.14m (£910,000) ransom after a covert negotiation witnessed by BBC News. The Netwalker criminal gang attacked University of California San Francisco (UCSF) on 1 June. IT staff unplugged computers in a race to stop the malware spreading. And an anonymous tip-off enabled BBC News to follow the ransom negotiations in a live chat on the dark web. Cyber-security experts say these sorts of negotiations are now happening all over the world - sometimes for even larger sums - against the advice of law-enforcement agencies, including the FBI, Europol and the UK's National Cyber Security Centre. Netwalker alone has been linked to at least two other ransomware attacks on universities in the past two months. Screenshot of Netwalker's dark web website used for negotiations with victims At first glance, its dark-web homepage looks like a standard customer-service website, with a frequently asked questions (FAQ) tab, an offer of a "free" sample of its software and a live-chat option. But there is also a countdown timer ticking down to a time when the hackers either double the price of their ransom, or delete the data they have scrambled with malware. Instructed to log in - either by email or a ransom note left on hacked computer screens - UCSF was met with the following message, posted on 5 June.Hacker chat box saying [Operator]: 'Hi UCSF, don't be shy we can work together on the current incident' Six hours later, the university asked for more time and for details of the hack to be removed from Netwalker's public blog. Hacker chat box saying 'Done. Your data is hide from our blog. Now, let's discuss.' Noting UCSF made billions a year, the hackers then demanded $3m But the UCSF representative, who may be an external specialist negotiator, explained the coronavirus pandemic had been "financially devastating" for the university and begged them to accept $780,000. After a day of back-and-forth negotiations, UCSF said it had pulled together all available money and could pay $1.02m - but the criminals refused to go below $1.5m. Hours later, the university came back with details of how it had procured more money and a final offer of $1,140,895. And the next day, 116.4 bitcoins were transferred to Netwalker's electronic wallets and the decryption software sent to UCSF. UCSF is now assisting the FBI with its investigations, while working to restore all affected systems. 

The U.S. is Set to Execute a Man with Schizophrenia and Alzheimer's. He Won't Even Know Why  - On July 15, the federal government plans to execute Wesley Purkey, a 68-year-old man with multiple brain disorders, including Alzheimer's disease and schizophrenia. The law is clear. Under the Constitution, an execution can only be carried out when the prisoner understands why he is being executed. Mr. Purkey believes his death is punishment, not for his crime, but for his frequent complaints against prison officials over prison conditions. In a lawsuit filed last November, Mr. Purkey's attorneys point to evidence of decades of delusional behavior and rapidly progressing dementia. An expert who examined Mr. Purkey concluded that his dementia and mental illness have progressed to the point that he is incapable of rationally understanding the reason for his execution. Though that is what the law requires, the Government is rushing forward with his execution, while withholding critical medical records and without giving the courts time to hold a hearing. Institutionalized on and off from age 14, Mr. Purkey has been diagnosed with schizophrenia, brain damage, and bipolar disorder. Records reveal decades of paranoid delusions, similar to those he suffers from today. These include elaborate conspiracies involving FBI plots and repeated beliefs that family members were poisoning him. Once he was admitted to the emergency room after claiming that his house was wired and that people on the roof were spraying a poisonous mist into his room that could be "activated by a beam." Another time he called the Kansas Bureau of Investigation to report that drug dealers had planted something in his chest and were trying to kill him with chemicals in the ceiling and the vents. On another occasion, he tore out the insulation from his home because he thought the FBI installed cameras in it. While on death row, Mr. Purkey's paranoia and delusions have worsened as his dementia has progressed. For nearly a decade, he has filed countless complaints against prison staff accusing them of putting poison and feces in his food, urinating on his laundry, and forcing him to live in a cell "caked in feces." Mr. Purkey firmly believes in these conspiracies and sees any evidence to the contrary as manufactured to cover-up the truth. Mr. Purkey's Alzheimer's has left him not only unable to understand the reason for his execution, but unable to remember significant events and names of the most important people in his life.

'Party' Drugs Lose Out Because Of COVID-19  -- According to an open online survey with 40,000 participants from twelve countries, the use of party drugs like MDMA and also cocaine has decreased around the world as clubs and other events are on hiatus.  Statista's Katharina Buchholz reports that research project Global Drug Survey found that while the use of marijuana, alcohol and benzodiazepines (Xanax, Valium) was up during the pandemic, a net share of 19 percent of respondent said they were using less cocaine (share of people saying they used it more minus share of people saying they used it less). A net share of 29 percent said they were using less MDMA. To quantify drug use, the survey asked people if they had used the drugs in question on more or less days of the week than usual.  Out of the twelve countries included in the survey, around 22 percent of Irish people and around 21 percent of Brits and Kiwis said their alcohol consumption during COVID-19 had increased a lot – the highest in the survey. Ireland and New Zealand residents also admitted to binge drinking a lot more (15 and 14 percent said so, respectively), while 47 percent of UK residents indicated they had started to drink earlier than usual. The most common reasons respondents gave for the increase in alcohol consumption were “I have more time to drink” and “I am more bored”.  Marijuana use increased the most in Australia and the UK with 26 percent and 23 percent saying their consumption increased a lot. Among party drug users, Australian and French respondents were most likely to say their use of MDMA and cocaine decreased significantly.

Companies have raised prices on 245 drugs during pandemic, advocacy group says  -- Pharmaceutical companies have raised prices on 245 drugs since the first U.S. coronavirus case was reported on Jan. 20, according to a report released Sunday by an advocacy group. Sixty-one of the drugs that saw price increases are being used to treat COVID-19, and 30 are in clinical trials, the group Patients for Affordable Drugs said in its report. The price hikes are on par with increases the previous two years. The report found that 44 inpatient drugs have seen price increases during the pandemic, including 20 drugs commonly used in intensive care units: sedatives, steroids, blood pressure medications and blood thinners. “It’s outrageous, but not surprising, that against the backdrop of the COVID-19 pandemic, drug corporations have continued to raise the prices of drugs critical to keeping Americans healthy and alive,” Patients for Affordable Drugs founder David Mitchell said in a statement. “Patients are hurting from this pandemic with widespread unemployment, insurance loss, and heightened risk for COVID-19. More than ever we all need to be able to afford our medications,” added Mitchell, who is a cancer patient. More than 125,000 people in the U.S. have died of COVID-19. Tens of millions who are now unemployed by the pandemic’s economic effects face out-of-pocket costs for medications. As cases have spiked across the nation in recent weeks, hospitals and intensive care units in several states are operating at or near capacity. Some of the drug price increases cited in Sunday’s report can be traced to disruptions in global supply chains, while others were in response to steep growth in demand, according to the report. Eight of the drugs with price hikes — including morphine and ketamine — are under FDA-declared shortages. Forty drugs being used to treat mild COVID-19 cases not requiring hospitalization, such as Tylenol and ibuprofen, also saw price hikes.

The FDA Needs to Get Back to Basics  - People want access to potentially life-saving drugs as soon as possible, especially during a pandemic. That’s why the FDA has the power to issue emergency use authorizations to provide patients with access to drugs that might otherwise be inaccessible during public health emergencies. Since authorizing the use of two investigational drugs to treat Covid-19 in recent months, however, the FDA has not properly carried out its duty to assure the safety and efficacy of those drugs. After issuing emergency use authorizations, the FDA needs to actively oversee the generation of high-quality evidence on the effects of promising but largely-unproven drugs on patient health.Since the passage of the Food, Drug, and Cosmetic Act in 1938, the FDA has been responsible for evaluating new therapies before those products become widely available to patients. Federal lawmakers charged the FDA with this mission after an unproven new product killed dozens of people, including many children. The FDA was born out of the need to prevent similar tragedies in the future.More than 80 years later, the agency’s origins as a safeguard against dangerous drugs still serve as a valuable guide for future action. Following its legacy of protecting patients from unsafe drugs, the FDA should quickly revoke emergency use authorizations for drugs when evidence emerges that shows products to be unsafe or ineffective. Regulators did just that in mid-June, revoking a previously-issued emergency use authorization for hydroxychloroquine and chloroquine.The decision to revoke that emergency use authorization came too late, though. To make more timely decisions about emergency authorization revocations, regulators need to have better access to high-quality data on drug-related patient outcomes. Passively monitoring drugs under emergency authorization does not produce the kind of robust data that regulators need to make decisions in times of crisis. According to federal law, the FDA may approve emergency use authorizations on the condition that data on the safety and effectiveness of authorized medications will be collected and analyzed. To protect patients from unsafe drugs and ensure the effectiveness of treatments, the FDA needs to routinely exercise that power. The ramifications of allowing the widespread use of investigational drugs without sufficient regulatory oversight could be dire.


How Exactly Do You Catch Covid-19? There Is a Growing Consensus – WSJ - Six months into the coronavirus crisis, there’s a growing consensus about a central question: How do people become infected? It’s not common to contract Covid-19 from a contaminated surface, scientists say. And fleeting encounters with people outdoors are unlikely to spread the coronavirus. Instead, the major culprit is close-up, person-to-person interactions for extended periods. Crowded events, poorly ventilated areas and places where people are talking loudly—or singing, in one famous case—maximize the risk. These emerging findings are helping businesses and governments devise reopening strategies to protect public health while getting economies going again. That includes tactics like installing plexiglass barriers, requiring people to wear masks in stores and other venues, using good ventilation systems and keeping windows open when possible. Two recent large studies showed that wide-scale lockdowns—stay-at-home orders, bans on large gatherings and business closures—prevented millions of infections and deaths around the world. Now, with more knowledge in hand, cities and states can deploy targeted interventions to keep the virus from taking off again, scientists and public-health experts said. That means better protections for nursing-home residents and multigenerational families living in crowded conditions, they said. It also means stressing physical distancing and masks, and reducing the number of gatherings in enclosed spaces. “We should not be thinking of a lockdown, but of ways to increase physical distance,” . “This can include allowing outside activities, allowing walking or cycling to an office with people all physically distant, curbside pickup from stores, and other innovative methods that can facilitate resumption of economic activity without a rekindling of the outbreak.” One important factor in transmission is that seemingly benign activities like speaking and breathing produce respiratory bits of varying sizes that can disperse along air currents and potentially infect people nearby. Health agencies have so far identified respiratory-droplet contact as the major mode of Covid-19 transmission. These large fluid droplets can transfer virus from one person to another if they land on the eyes, nose or mouth. But they tend to fall to the ground or on other surfaces pretty quickly. Some researchers say the new coronavirus can also be transmitted through aerosols, or minuscule droplets that float in the air longer than large droplets. These aerosols can be directly inhaled.

How the Coronavirus Short-Circuits the Immune System - At the beginning of the pandemic, the coronavirus looked to be another respiratory illness. But the virus has turned out to affect not just the lungs, but the kidneys, the heart and the circulatory system — even, somehow, our senses of smell and taste. Now researchers have discovered yet another unpleasant surprise. In many patients hospitalized with the coronavirus, the immune system is threatened by a depletion of certain essential cells, suggesting eerie parallels with H.I.V. The findings suggest that a popular treatment to tamp down the immune system in severely ill patients may help a few, but could harm many others. The research offers clues about why very few children get sick when they are infected, and hints that a cocktail of drugs may be needed to bring the coronavirus under control, as is the case with H.I.V. Growing research points to “very complex immunological signatures of the virus,” said Dr. John Wherry, an immunologist at the University of Pennsylvania whose lab is taking a detailed look at the immune systems of Covid-19 patients. In May, Dr. Wherry and his colleagues posted online a paper showing a range of immune system defects in severely ill patients, including a loss of virus-fighting T cells in parts of the body. In a separate study, the investigators identified three patterns of immune defects, and concluded that T cells and B cells, which help orchestrate the immune response, were inactive in roughly 30 percent of the 71 Covid-19 patients they examined. None of the papers have yet been published or peer reviewed. Researchers in China have reported a similar depletion of T cells in critically ill patients, Dr. Wherry noted. But the emerging data could be difficult to interpret, he said — “like a Rorschach test.” Research with severely ill Covid-19 patients is fraught with difficulties, noted Dr. Carl June, an immunologist at the University of Pennsylvania who was not involved with the work. “It is hard to separate the effects of simply being critically ill and in an I.C.U., which can cause havoc on your immune system,” he said. “What is missing is a control population infected with another severe virus, like influenza.”

Coronavirus: Asymptomatic People Can Still Develop Lung Damage -- The first patient with COVID-19 that presented to my hospital was probably typical of initial patients in many other hospitals at the time. He was an elderly man with pneumonia, as yet untested for the new coronavirus but presumed to have it. An expert team carefully assessed him, prescribed high-flow oxygen and monitored him on a respiratory ward. He died unexpectedly that night.   The second patient was a middle-aged woman referred to the intensive care unit for mechanical ventilation. The recent death had made me nervous, so I went to assess her. On my way to the ward, I imagined the picture that awaited me – a patient gasping for air, barely able to speak, chest heaving with the effort of trying to drive oxygen into her blood. When I arrived decked out in full PPE and ready to sedate her for immediate ventilation, I thought I had arrived at the wrong bed. She sat comfortably on her chair, speaking on her mobile phone to her daughter, bemused by my appearance. Overcautious colleagues, I thought, but measured her blood oxygen saturation just in case, more from instinct than concern. From her appearance I expected it to be close to normal (100%). It was 75% – a level barely compatible with being conscious. I quickly learned that many patients with advanced COVID-19 disease bore none of the hallmarks of severe respiratory illness until they suddenly collapsed and died. The science behind this early lesson is now emerging, with a study from Wuhan, China, describing pathological lung changes on CT scans of completely asymptomatic patients. Asymptomatic carriage is not uncommon in other virulent infections, such as MRSA and C diff, but what is striking with SARS-CoV-2 (the virus that causes COVID-19) is that it may be accompanied by underlying organ damage. The researchers found lesions consistent with inflammation of the underlying lung tissue (ground-glass opacities and consolidation, to use the medical jargon), which are not specific to SARS-CoV-2 infection and may be seen in many other forms of lung disease. What remains a mystery is why, despite these changes, patients do not display typical symptoms of pneumonia, such as severe shortness of breath. About a quarter of the patients in the study developed a fever, cough and shortness of breath – but many did not. The idiosyncratic response to infection is one of several conundrums of COVID-19, such as why it targets certain groups and not others – two people with exactly the same demography and health may express the disease at opposite ends of the spectrum. The study reinforces that absence of symptoms does not imply the absence of harm. Lack of symptoms in the face of active pathology carries a risk both to infected individuals and to the public. Current advice encourages patients to stay at home if they are asymptomatic, making late presentation to hospital and sudden death a distinct risk.

Not just the lungs: Covid-19 attacks like no other 'respiratory' virus - The reports seemed to take doctors by surprise: The “respiratory” virus that causes Covid-19 made some patients nauseous. It left others unable to smell. In some, it caused acute kidney injury. As the pandemic grew from an outbreak affecting thousands in Wuhan, China, to some 10 million cases and 500,000 deaths globally as of late June, the list of symptoms has also exploded. The Centers for Disease Control and Prevention constantly scrambled to update its list in an effort to help clinicians identify likely cases, a crucial diagnostic aid at a time when swab tests were in short supply and typically took (and still take) days to return results. The loss of a sense of smell made the list only in late April.  “For many diseases, it can take years before we fully characterize the different ways that it affects people,” said nephrologist Dan Negoianu of Penn Medicine. “Even now, we are still very early in the process of understanding this disease.”   What they are understanding is that this coronavirus “has such a diversity of effects on so many different organs, it keeps us up at night,” said Thomas McGinn, deputy physician in chief at Northwell Health and director of the Feinstein Institutes for Medical Research. “It’s amazing how many different ways it affects the body.” One early hint that that would be the case came in late January, when scientists in China identified one of the two receptors by which the coronavirus, SARS-CoV-2, enters cells. It was the same gateway, called the ACE2 receptor, that the original SARS virus used. Studies going back some two decades had mapped the body’s ACE2 receptors, showing that they’re in cells that line the insides of blood vessels — in what are called vascular endothelial cells — in cells of the kidney’s tubules, in the gastrointestinal tract, and even in the testes. Infecting cells is only the first way SARS-CoV-2 wreaks havoc. Patients with severe Covid-19 also suffer a runaway inflammatory response and, often, clot formation, said infectious disease physician Rochelle Walensky of Massachusetts General Hospital. That can cause symptoms as different as a lack of blood flow to the intestines and the red, inflamed “Covid toe.” “We’ve had five cases of patients who’ve had to have their gut removed,” Walensky said. “You see these cases and you say, wait a minute; the virus is doing this, too? It has definitely been keeping us on our toes.”

Coronavirus damages the endocrine system --People with endocrine disorders may see their condition worsen as a result of COVID-19, according to a new review published in the Journal of the Endocrine Society. "We explored the previous SARS outbreak caused by the very similar virus SARS-CoV-1 to advise endocrinologists involved in the care of patients with COVID-19," said Noel Pratheepan Somasundaram of the National Hospital of Sri Lanka in Colombo, Sri Lanka. "The virus that causes COVID-19--SARS-CoV-2--binds to the ACE2 receptor, a protein which is expressed in many tissues. This allows the virus to enter endocrine cells and cause the mayhem associated with the disease." SARS-CoV-2 can cause loss of smell and gain entry to the brain. In past coronavirus infections such as the SARS epidemic in 2003, many patients developed a post-viral syndrome with fatigue. This could in part be caused by adrenal insufficiency, a condition where the adrenal glands do not make enough cortisol, as a result of damage to the pituitary system. During the SARS epidemic, patients who developed adrenal insufficiency typically recovered within one year. "Testing for cortisol deficiency and treating patients with steroids may become a vital treatment strategy," Somasundaram said. "Very recent studies have demonstrated lowered mortality in severely-ill patients with COVID-19 treated with the steroid dexamethasone." COVID-19 also could lead to new cases of diabetes and worsening of existing diabetes. The SARS-CoV-2 virus attaches to ACE2, the main entry point into cells for coronavirus, and disrupts insulin production, causing high blood glucose levels in some patients. The authors highlight the need for strict glucose monitoring in patients with COVID-19 as a measure to maximize recovery. "People with vitamin D deficiency may be more susceptible to coronavirus and supplementation could improve outcomes, though evidence on the subject is mixed,"

Covid-19 brain complications include strokes and psychosis  -- A new survey reveals a wide range of serious psychiatric and neurological complications tied to Covid-19 — including stroke, psychosis, and a dementia-like syndrome. The study underscores how aggressively the coronavirus can attack beyond the lungs, and the risk the disease can pose to younger adults.The study looked at 125 hospitalized patients with Covid-19 who also had some sort of neuropsychiatric complication. Fifty-seven had had an ischemic stroke, caused by a blood clot in the brain. The second most common issue, affecting 39 patients, was an altered mental state, researchers reported. That included encephalitis (an inflammation of the brain that can cause a number of symptoms, from confusion to mobility problems) and encephalopathy (a general term for a disease that alters brain function). Ten patients were newly diagnosed with psychosis, and six had cognitive issues akin to dementia, according to the study, published in the Lancet Psychiatry.“What was particularly interesting was that this spanned the neurological spectrum,” said senior a uthor Benedict Michael of the University of Liverpool, a neurologist specializing in infectious diseases.The people in the study ranged from their 20s to their 90s, and the researchers noted that, because they focused on hospitalized patients, the complications detailed likely represent the most serious ones. Whereas the strokes were more common among older patients, the researchers found that about half of those who experienced altered mental status were younger than 60. Smaller studies and case reports from China and other European countries had raised the connection between Covid-19 and neuropsychiatric complications, but for the new study, the researchers set out to get a full picture of the range of those complications. To amass as broad a data set as possible, they built a reporting network across the United Kingdom that enlisted specialists in stroke, neurology, psychiatry, and critical care. “Everybody is focused on mortality, which they should, and respiratory problems, which is the main cause of death,” said Mark George, a psychiatrist and neurologist at the Medical University of South Carolina. But, George said, “the virus certainly does have brain effects.”

Three Stages to COVID-19 Brain Damage, New Review Suggests -- In stage 1, viral damage is limited to epithelial cells of the nose and mouth, and in stage 2 blood clots that form in the lungs may travel to the brain, leading tostroke. In stage 3, the virus crosses the blood–brain barrier and invades the brain."Our major take-home points are that patients with COVID-19 symptoms, such as shortness of breath, headache, or dizziness, may have neurological symptoms that, at the time of hospitalization, might not be noticed or prioritized, or whose neurological symptoms may become apparent only after they leave the hospital," lead author Majid Fotuhi, MD, PhD, medical director of NeuroGrow Brain Fitness Center, McLean, Virginia, told Medscape Medical News."Hospitalized patients with COVID-19 should have a neurological evaluation and ideally a brain MRI before leaving the hospital; and, if there are abnormalities, they should follow up with a neurologist in 3 to 4 months," said Fotuhi, who is also affiliate staff at Johns Hopkins Medicine in Baltimore, Maryland. The review was published online June 8 in the Journal of Alzheimer's Disease.It has become "increasingly evident" that SARS-CoV-2 can cause neurologic manifestations, including anosmia, seizures, stroke, confusion, encephalopathy, and total paralysis, the authors write.The authors note that SARS-CoV-2 binds to angiotensin-converting enzyme 2 (ACE2) that facilitates the conversion of angiotensin II to angiotensin. After ACE2 has bound to respiratory epithelial cells, and then to epithelial cells in blood vessels, SARS-CoV-2 triggers the formation of a "cytokine storm."These cytokines, in turn, increase vascular permeability, edema, and widespread inflammation, as well as triggering "hypercoagulation cascades," which cause small and large blood clots that affect multiple organs.If SARS-CoV-2 crosses the blood–brain barrier, directly entering the brain, it can contribute to demyelination or neurodegeneration."We very thoroughly reviewed the literature published between January 1 and May 1, 2020 about neurological issues [in COVID-19] and what I found interesting is that so many neurological things can happen due to a virus which is so small," said Fotuhi."This virus' DNA has such limited information, and yet it can wreak havoc on our nervous system because it kicks off such a potent defense system in our body that damages our nervous system," he said.

'Significant number' of people may have some natural immunity to coronavirus -- Large numbers of the population may have natural immunity against coronavirus even if they have never been infected, scientists believe. Sir John Bell, Regius Professor of Medicine at Oxford University, who is leading an Oxford team to develop a vaccine, said there was likely to be a "background level" of protection for a "significant number of people". Recent studies have suggested the immune system can be primed by other coronaviruses, such as the common cold, giving the body a head start in fighting off Covid-19. Research shows that a separate part of the immune system, T-cells, respond to chains of amino acids produced by different types of coronaviruses and may be responsible for stopping the virus in people who never show symptoms. Crucially, those T-cells die off in older people, which may be why they are far more likely to develop a more serious illness. Speaking to the Commons science and technology select committee, Sir John said: "What seems clear is you do have cross-reaction from T-cells that are activated by standard endemic coronaviruses. I think they are present in quite a significant number of people. "So there is probably background T-cell immunity in people before they see the coronavirus, and that may be relevant that many people get a pretty asymptomatic disease. "Those T-cells get a bit tired once you're beyond the age of 65 and may not be as effective at removing a virus, so that may explain a number of different features of the disease." The vaccine being developed by Oxford University has been found not only to stimulate antibodies but also to boost T-cell response. But many more people may already have some protection, suggesting herd immunity will be easier and quicker to establish, the research suggests. 

The list of who's most at risk for severe cases of COVID-19 just got longer, CDC says - The older you are, the greater your risk of suffering a severe case of COVID-19, according to new guidance from the Centers for Disease Control and Prevention.The CDC has previously warned that people over 65 were especially vulnerable to severe illness if they became infected by the coronavirus. And that is still true.But more recent data from across the United States show that younger adults are also at risk and should not assume they will be spared from a serious case of the disease.“CDC now warns that among adults, risk increases steadily as you age, and it’s not just those over the age of 65 who are at increased risk for severe illness,” the agencywarned Thursday. “Age is an independent risk factor for severe illness.”Data published last week in the CDC’s Morbidity and Mortality Weekly Report revealed that the median age of Americans with confirmed coronavirus cases was 48 years old. That means half of those infected were older than 48 and half were younger. In fact, among more than 1.3 million cases reported through May 30, the incidence was higher among people in their 40s and 50s than for those in their 60s and 70s. Specifically, there were 541.6 cases per 100,000 people ages 40 to 49 and 550.5 cases per 100,000 people ages 50 to 59, compared with 478.4 cases per 100,000 people ages 60 to 69 and 464.2 cases per 100,000 people ages 70 to 79. The highest incidence was seen in the oldest Americans, with 902 cases per 100,000 people ages 80 and up, according to the report. Among those who become infected with the coronavirus, the risk of dying from COVID-19 increases sharply with age, the latest data show. Although the overall mortality rate for those 1.3 million cases was 5.4%, it was 1% or lower for Americans under 50. However, it was 2.4% for those in their 50s, 6.7% for those in their 60s, 16.6% for those in their 70s and 28.7% for those 80 and up.

As coronavirus spreads to people under 40, it's making them sicker — and for longer — than once thought   For the first few months of the coronavirus pandemic, health and government officials assured the public that young people were at little or no risk of falling seriously ill from COVID-19. But many young people who have contracted the virus tell a very different story, one that should serve as a warning to young adults in the Southern and Western states where infections are surging. Last week President Trump discounted the risks COVID-19 poses to young people, saying that increased testing was inflating the numbers of the disease among “young people that don’t have a problem.”But as the number of new cases of the disease has swelled by 76 percent in the U.S. over the past 14 days, young people who considered themselves in little danger from the virus are the ones being admitted to hospitals. Testifying before the House Energy and Commerce Committee last week, Dr. Anthony Fauci, the leading expert on infectious diseases on the coronavirus task force, contradicted Trump’s view that young people “don’t have a problem” with COVID-19.“To think young people have no deleterious consequences is not true. We’re seeing more and more complications in young people,” Fauci said, adding that “some get mild symptoms and some get symptoms enough to put them at home for a few days. Some are in bed for weeks and have symptoms even after they recover, others go to the hospital, some require oxygen, some require intensive care, some get intubated and some die.”While researchers are still trying to determine the extent of the lasting damage inflicted by COVID-19, one thing is clear: Just because the disease may not kill you doesn’t mean it will make you stronger. Studies conducted so far point to possible long-term heart damage, scarring of the lungs, impact on the nervous system and a higher incidence of stroke.

Why Meatpacking Plants Are Superspreaders - If there is a paradise for SARS-CoV-2, it would probably be a slaughterhouse. Work units in meat plants are cooled to under 12 degrees Celsius. Workers stand near one another and sweat as they labor under pressure - an ideal situation for viruses transmitted by droplets, aerosols or contact.  Canadian and British researchers working under Quentin Durand-Moreau of the University of Alberta have studied the working conditions in meat plants. The "metallic surfaces” and the "low temperatures,” they report, enhance the longevity of viruses like SARS-CoV-2. They also explain that the plants are often very loud: "The need for raised voices to overcome noise may increase transmission of SARS-CoV-2,” the researchers wrote. Workers, they argue, also feel pressured by their precarious work situation to "keep working despite having symptoms of COVID-19.” "The working conditions in the slaughterhouses cannot be reconciled with the hygiene measures that are currently necessary,” warns Isabella Eckerle, the head of Geneva Center for Emerging Viral Diseases. At the Tönnies slaughterhouse, the virologist says, the large number of infected employees points to "an undetected superspreading event.” She explains that, if there was close contact and unfavorable working and living conditions, a single infected person or a small number of infected people could potentially have infected many other employees. "The physical exertion during the work, which leads to greater virus expulsion, is another possible factor,” Eckerle says. Damp hands and gloves, aprons and clothing worn during meat handling could also facilitate the virus being transmitted via smear infections.Coronaviruses have a relatively strong, fatty shell that gives them a kind of rubber-like protection in cool conditions. That makes them robust. Researchers have already shown that SARS-CoV-2 can survive up to 72 hours on surfaces in temperatures between 21 and 23 degrees Celsius (70 and 73 degrees Fahrenheit). Lower temperatures extend that time even further. Experiments show that the viruses can survive longer than 28 days at 4 degrees Celsius.Coolness is also ideal for the spread of SARS-CoV-2. Health expert Tom Jefferson from Oxford University says the virus transmits best at temperatures between 0 and 10 degrees, with low humidity, high air pressure and little wind. High temperatures and strong UV radiation, he says, inhibit the spread of the virus.

Nursing Homes Account For 11% Of COVID-19 Cases, 43% Of Deaths In US - 43% of all COVID-19 deaths in the United States are residents or employees of nursing homes or other long-term care (LTC) facilities, according to the New York Times (which fails to mention that New York Governor Andrew Cuomo ordered NY nursing homes to accept coronavirus patients from hospitals). Nursing homes, meanwhile, account for just 11% of all COVID-19 cases in the United States. To date, just over 125,000 people in the US have died of COVID-19, 54,000 of which were linked to LTC facilities. By state, New Hampshire LTC facilities are at the top of the list - accounting 80% of COVID-19 deaths in the state. Rhode Island and Minnesota are tied at 77%, while Connecticut comes in at 73% of deaths linked to nursing homes. The share of deaths linked to long-term care facilities for older adults is even starker at the state level. In 24 states, the number of residents and workers who have died accounts for either half or more than half of all deaths from the virus. Infected people linked to nursing homes also die at a higher rate than the general population. The median case fatality rate — the number of deaths divided by the number of cases — at facilities with reliable data is 17 percent, significantly higher than the 5 percent case fatality rate nationwide. -New York Times   And while New York ranks at the bottom of the pack when it comes to LTC facility deaths as a percentage of overall deaths in the state, New York nursing homes come in 2nd on the list after New Jersey in terms of overall deaths in LTC facilities, at 6,432.

“The patients in March didn’t have to die like this, if we would have had more staff and better equipment to work with” -  The WSWS recently spoke with a respiratory therapist at Elmhurst Hospital in Queens, New York City, about her experiences in the coronavirus pandemic. For two months, from March through April, Elmhurst Hospital, which serves a large and predominantly immigrant working class community, was “the epicenter of the epicenter” of the COVID pandemic in the US. Respiratory therapists are trained to treat patients with severe respiratory diseases and operate ventilators and other respiratory equipment. They are, therefore, indispensable for the treatment of critically ill COVID-19 patients.  Patricia has worked with intubated patients for 22 years. At several points during the interview, she was overcome with emotion, recalling the deeply traumatic experiences of the past months.  “We started getting patients in late February, but we didn’t realize they were COVID positive until March. It came on so fast, we were not prepared at all, we tried, but the amount of patients coming with COVID was more than we anticipated.”    Later scientific models found that already in early March about 10,000 people must have been infected with the virus in New York. In fact, March, Patricia told the WSWS, was “the hardest month” at Elmhurst. “We had practically no staff and we were not able to get to everybody. We had multiple codes, rapid response teams, and intubations at once. Although there were MDs [doctors] and nurses at these events, we could barely keep up with bringing vents and BiPAPs [Bilevel Positive Airway Pressure machines for non-invasive ventilation] to the floors for intubation. We had to choose who we could help. So many floors were paging us at once. It was so overwhelming physically and emotionally.” She said that they had to “beg” their administrator for more staff. When she proposed that the hospital hire respiratory therapists from agencies for $4,500 to $7,000 a week, he responded, “I’m not paying that.” In late March, an ER doctor from Elmhurst Hospital, Colleen Smith, published a desperate video plea for help in the New York Times, calling conditions at the hospital “apocalyptic.” By then, refrigerated trucks and makeshift morgues were beginning to appear outside major hospitals in New York City.  “Prior to getting help, it was pure hell. Ten to 20 patients would die daily. Most of the time you would have two to three floors to yourself and/or multiple ICU units. That’s about 20 to 30 vents to yourself, in addition to responding to cardiac arrests, rapid response teams, transporting vent dependent patients to units or procedures, and trying to give meds. And we were trying to help out our colleagues as well. “Initially, we would have five respiratory therapists for the day shift and four at nights, but this went down as March went on, due to people getting sick and quitting on us. Two elderly co-workers put in their papers early because they were overwhelmed. Another quit because he got sick and was stressed out. Another coworker got really sick and was intubated. He’s not intubated anymore, but it will take a long time for him to recover. He is not the same.” She estimated that five or more hospital workers had died from COVID-19 at Elmhurst.

Public Transit Use Largely Responsible For 'Racial Discrepancy' In COVID-19 Death Rates - Black and Hispanic Americans have been dying of the coronavirus at rates 3.5x those of white Americans. For weeks now, politicians and activists have cited these data as evidence that "white supremacy" does, in fact, exist, since minorities - they argued - were more likely to work low-paid "essential" jobs at grocery stores, pharmacies, etc. As it turns out, these theories, reported as if they were undeniable truths by the mainstream press (including the New York Times & Washington Post), didn't tell the whole story. While it's true minorities are dying at higher rates than white people from COVID-19, several recently published studies have determined that these higher mortality rates are likely connected to their higher use of public transit to commute to work - either via subway or bus. Furthermore, the study finds, elevated infection and mortality rates impact all people who take public transit, regardless of racial or economic status. A study supervised and published by University of Virginia economist John McLaren found that the racial discrepancy remained even after controlling for income and health insurance rates. At first, this result puzzled the team of economists. Until they examined these infection rates through a different lens: that of transportation. About 10.4% of black commuters take public transit, versus 3.4% of white commuters, according to Census data. McLaren and his team found that by controlling for the use of public transit, the racial disparity in COVID-19 deaths becomes far less pronounced. This suggests that no matter what your job, or your race, one of the most dangerous things you can do to put yourself at risk during the outbreak is to rely on public transit, be it buses or subways, in NYC, or elsewhere.

Gilead Will Charge More Than $3,000 For A Course Of COVID-19 Drug Remdesivir - All those stories about patients being billed for tens of thousands of dollars for coronavirus-related care elicited promises from the White House that "everything will be covered". Still, as thousands of Americans complain about charges related to COVID-19 testing and care being passed on by their insurance companies, Gilead, the pharmaceutical company that has pushed remdesivir down the world's throat despite the fact that the cheap steroid dexamethasone has proven - in at least one high quality study - more effective at lowering mortality rates, has just published its expected pricetag for a five-dose course of the drug. On Monday, Gilead disclosed its pricing plan for Gilead as it prepares to begin charging for the drug at the beginning of next month (several international governments have already placed orders). Given the high demand, thanks in part due to the breathless media coverage despite the drug's still-questionable study data, Gilead apparently feels justified in charging $3,120 for a patient getting the shorter, more common, treatment course, and $5,720 for the longer course for more seriously ill patients. These are the prices for patients with commercial insurance in the US, according to Gilead's official pricing plan. As per usual, the price charged to those on government plans will be lower, and hospitals will also receive a slight discount. Additionally, the US is the only developed country where Gilead will charge two prices, according to Gilead CEO Daniel O’Day. In much of Europe and Canada, governments negotiate drug prices directly with drugmakers (in the US, laws dictate that drug makers must "discount" their drugs for medicare and medicaid plans). But according to O'Day, the drug is priced "far below the value it brings" to the health-care system. However, we'd argue that this actually isn't true. Remdesivir was developed by Gilead to treat Ebola, but the drug was never approved by the FDA for this use, which caused Gilead to shelve the drug until COVID-19 presented another opportunity. Even before the first study had finished, the company was already pushing propaganda about the promising nature of the drug. Meanwhile, the CDC, WHO and other organizations were raising doubts about the effectiveness of steroid medications. Months later, the only study on the steroid dexomethasone, a cheap steroid that costs less than $50 for a 100-dose regimen, has shown that dexomethasone is the only drug so far that has proven effective at lowering COVID-19 related mortality. Remdesivir, despite the fact that it has been tested in several high quality trials, has not. 

US buys up world stock of key Covid-19 drug remdesivir -- The US has bought up virtually all the stocks for the next three months of one of the two drugs proven to work against Covid-19, leaving none for the UK, Europe or most of the rest of the world. Experts and campaigners are alarmed both by the US unilateral action on remdesivir and the wider implications, for instance in the event of a vaccine becoming available. The Trump administration has already shown that it is prepared to outbid and outmanoeuvre all other countries to secure the medical supplies it needs for the US. “They’ve got access to most of the drug supply [of remdesivir], so there’s nothing for Europe,” said Dr Andrew Hill, senior visiting research fellow at Liverpool University. Remdesivir, the first drug approved by licensing authorities in the US to treat Covid-19, is made by Gilead and has been shown to help people recover faster from the disease. The first 140,000 doses, supplied to drug trials around the world, have been used up. The Trump administration has now bought more than 500,000 doses, which is all of Gilead’s production for July and 90% of August and September. “President Trump has struck an amazing deal to ensure Americans have access to the first authorised therapeutic for Covid-19,” said the US health and human services secretary, Alex Azar. “To the extent possible, we want to ensure that any American patient who needs remdesivir can get it. The Trump administration is doing everything in our power to learn more about life-saving therapeutics for Covid-19 and secure access to these options for the American people.” The drug, which was invented for Ebola but failed to work, is under patent to Gilead, which means no other company in wealthy countries can make it. The cost is around $3,200 per treatment of six doses, according to the US government statement.  The US has recorded more than 2.5 million confirmed cases of Covid-19. Some states lifted restrictions only to have to clamp down again. On Monday, the governor of Arizona ordered bars, cinemas, gyms and water parks to shut down for a month, weeks after they reopened. Texas, Florida and California, all seeing rises in cases, have also reimposed restrictions. Buying up the world’s supply of remdesivir is not just a reaction to the increasing spread and death toll. The US has taken an “America first” attitude throughout the global pandemic. 

Coronavirus cases are declining in only 2 states as virus surges in US -  As the coronavirus surges in the US, only two states — — Connecticut and Rhode Island — are reporting declining cases, per CNN. In 36 states, cases are rising, with the country reaching an all-time one-day high of 40,000 new cases on Friday, according to data from Johns Hopkins University.  Globally, confirmed cases have exceeded 10 million, with 2,510,337 of those in the US, per Johns Hopkins University. The growth of new US cases could have multiple causes, Surgeon General Jerome Adams, the nation's top doctor, said in an interview with Business Insider on Saturday. "In some places it may be because they did in fact reopen too early," Adams told Business Insider. "In other cases it may be that they reopened right on time and that the governmental institutions and public health institutions did everything right, but that the citizens did not have the will or desire or the follow through to do the social distancing that we have recommended, and to wear coverings as we have recommended." Nearly half of US states started reopening in late April and early May without meeting White House requirements, which dictated that states should wait to see downward trends in cases or positive tests before reopening, as Business Insider's Aria Bendix recently reported. Now, the 36 states seeing a surge in new cases include California, Florida, Georgia, Hawaii, Nevada, and Texas. Texas Gov. Greg Abbott said last week he would pause the state's reopening, and the next day he closed bars and limited restaurant capacity. In Connecticut, the first phase of reopening from its lockdown started on May 20, after several days of declining cases and hospitalizations. The state entered its second reopening phase of on June 17, a few days ahead of schedule, as hospitalizations and infection rates remained low. Rhode Island's first phase of reopening started on May 9, after Gov. Gina Raimondo said that cases and hospitalizations had held steady for two weeks, with a 25% drop in new cases in that time period. Since then, average new cases have continued to decline, with hospitalizations dropping below 100 on Friday. Gov. Raimondo had said back in April that, before reopening, Rhode Island would need to meet requirements that included 14 days with decreasing new cases, the capacity to quickly identify community spread, adequate capacity in the healthcare system, and plans for long-term social distancing measures.

States with highest income inequality experienced a larger number of COVID-19 deaths - States with the highest level of income inequality had a larger number of COVID-19-related deaths compared with states with lower income inequality. New York state, with the highest income inequality, had a mortality rate of 51.7 deaths per 100,000. This is 125 times greater than Utah, the state with the lowest income inequality and which had a mortality of 0.41 per 100,000 at the end of the period studied. Looking at the top three in each category, New York was followed by Louisiana with 19 deaths per 100,000, and Connecticut with 16.9 deaths per 100,000. States in addition to Utah with the lowest COVID deaths that were linked to income inequality were South Dakota, with 0.7 deaths per 100,000 and North Dakota, which had one death per 100,000. The researchers limited their analysis to January 22 through April 13, 2020. They used data on cases and deaths from the COVID-19 Dashboard maintained by the Center for Systems Science and Engineering at Johns Hopkins University. State income inequality data came from the 2018 American Community Survey as measured by the Gini index, a statistical formula used to measure income distribution.

Air conditioning may be factor in COVID-19 spread in the South - Drawing on insights from another deadly airborne disease, tuberculosis, a Harvard infectious disease expert suggested Friday that air conditioning use across the southern U.S. may be a factor in spiking COVID-19 cases and that ultraviolet lights long used to sterilize the air of TB bacteria could do the same for SARS-CoV-2. Edward Nardell, professor of medicine and of global health and social medicine at Harvard Medical School (HMS) and professor of environmental health and of immunology and infectious diseases at the Harvard T.H. Chan School of Public Health, said that hot summer temperatures can create situations similar to those in winter, when respiratory ailments tend to surge, driving people indoors to breathe — and rebreathe —air that typically is little refreshed from outside. “The states that, in June, are already using a lot of air conditioning because of high temperatures are also the places where there’s been greater increases in spread of COVID-19, suggesting more time indoors as temperatures rise,” Nardell said. “The same [thing] happens in wintertime, with more time indoors.” Though transmission of the SARS-CoV-2 virus has been understood to transmit mainly through large droplets expelled during coughing, sneezing, or talking, Nardell said that evidence has risen that at least some cases of COVID-19 occur via airborne transmission. That happens when virus particles contained in smaller droplets don’t settle out within six feet and instead hang in the air and drift on currents. Airborne transmission would make people even more vulnerable to the virus in a closed room. Nardell said that in an office occupied by five people, as windows are closed and air conditioners turned on, CO2 levels rise steeply, a sign that occupants are rebreathing air in the room and from each other. “As people go indoors in hot weather and the rebreathed air fraction goes up, the risk of infection is quite dramatic,” Nardell said, adding that the data, while gathered related to tuberculosis, would apply to any infection with airborne potential.

COVID-19 Outbreak Associated with Air Conditioning in Restaurant, Guangzhou, China, 2020 -  – CDC -- Lu et al. (1) describe the indoor airborne spread of COVID-19 (coronavirus disease) facilitated by a type of standard, wall-mounted, ductless air conditioner (AC) used in most countries. These units are low-cost in comparison to ducted AC units, which can cost 3 times as much to purchase, install, and operate. Ductless units cool and dehumidify indoor air but have little ability to filter or remove airborne contaminants. A wall-mounted ductless system blows air directly onto those closest to it, potentially disseminating infectious droplets or aerosols along the airflow. Lu et al. use arrows to point out the airflows emanating from and returning to the AC unit, delineating a possible trajectory of putative airborne droplets. This trajectory coincides with the seating distribution of other persons at the restaurant who later became ill (1). We agree that the AC probably contributed to the upstream and downstream airborne spread of the virus. The type of AC system required to mitigate airborne transmission is neither affordable nor architecturally feasible for many buildings or regions. To prevent the spread of coronavirus disease in indoor spaces, we need work-around solutions in addition to distancing and fresh air exchange. Viable, low-cost possibilities might include operating AC on low fan settings and installing units near the ceiling, which would channel airflow towards the ceiling instead of directly onto patrons. Other methods might include the installation of high-efficiency particulate air filters, ultraviolet germicidal irradiation (which can disinfect some airborne coronaviruses such as mouse hepatitis virus and Middle Eastern respiratory syndrome coronavirus) (2), or a combination of these methods.

June 28 COVID-19 Test Results, Highest Percent Positive Since Early May -The US is now conducting over 500,000 tests per day, and that might be enough to allow test-and-trace in some areas. Based on the experience of other countries, the percent positive needs to be well under 5% to really push down new infections, so the US still needs to increase the number of tests per day significantly. According to Dr. Jha of Harvard's Global Health Institute, the US might need more than 900,000 tests per day. There were 539,333 test results reported over the last 24 hours. There were 42,161 positive tests. This is the third consecutive day with over 40,000 positive cases. This data is from the COVID Tracking Project.The percent positive over the last 24 hours was 7.8% (red line).For the status of contact tracing by state, check out

California, Texas see record COVID-19 surges, Arizona clamps down - (Reuters) - California and Texas both marked record spikes in new COVID-19 infections on Monday, a Reuters tally showed, as Los Angeles reported an “alarming” one-day surge in America’s second-largest city that put it over 100,000 cases. Los Angeles has become a new epicenter in the pandemic as coronavirus cases and hospitalizations surge there despite California Governor Gavin Newsom’s strict orders requiring bars to close and residents to wear masks in nearly all public spaces. “The alarming increases in cases, positivity rates and hospitalizations signals that we, as a community, need to take immediate action to slow the spread of COVID-19,” Barbara Ferrer, director of public health for Los Angeles County, said in a statement announcing the sharp rise. “Otherwise, we are quickly moving toward overwhelming our healthcare system and seeing even more devastating illness and death,” Ferrer said. Los Angeles Mayor Eric Garcetti announced a “hard pause” on when movie theaters, theme parks and other entertainment venues can reopen. Los Angeles County is the biggest movie theater market in the United States. Los Angeles County said its beaches will be closed for the Independence Day weekend and fireworks displays will be banned. Statewide positive tests for COVID-19, the respiratory illness caused by the virus, rose by at least 7,418 in California Monday to nearly 223,000, the biggest one-day increase since tracking began. Los Angeles County, with a population of 10 million, has recorded 100,000 cases. California is among a number of U.S. states including Florida, Texas and Arizona battling a new wave of infections as the nation emerges from weeks of clamp-downs on residents and businesses. COVID-19 infections in Texas rose by 6,545 on Monday to nearly 160,000, also setting a record for a one-day increase. Nationally, cases rose by more than 40,000, for the fourth time in the past five days.

Arizona orders bars and gyms to close, joining other states in reversing reopening - The governor of Arizona has ordered bars, movie theaters, gyms and water parks to shut down, in a dramatic move that echoed similar efforts by states around the country to roll back plans for reopening. The order from the Republican governor, Doug Ducey, came on Monday and went into effect immediately, and will last for at least 30 days. Ducey also also ordered public schools to delay the start of the classes at least until 17 August. “Our expectation is that our numbers next week will be worse,” he said. Arizona health officials reported 3,858 more confirmed coronavirus cases Sunday, the most reported in a single day in the state so far and the seventh time in the last 10 days that daily cases surpassed the 3,000 mark. Since the pandemic began, 74,500 cases and 1,588 deaths stemming from the virus have been reported in Arizona. Most Arizona bars and nightclubs opened after Ducey’s stay-at-home and business closure orders were allowed to expire in mid-May. The state is not alone in its reversal. Places such as Texas, Florida and California are backtracking, closing beaches and bars in some cases amid a resurgence of the virus. Oregon and Kansas, meanwhile, announced Monday that everyone would be required to wear masks in public. In California over the weekend, the governor, Gavin Newsom, ordered bars and nightclubs in nine counties to close, including Los Angeles, which has nearly 100,000 cases – the most of any region of the state. The state is in the midst of trying to “toggle back” plans to reopen as case numbers and hospitalizations flare up in sections of the state. Red flags have been raised on a number of metrics, including “disturbing trendlines” in positivity rates, hospitalizations and ICU admissions. Particularly hard hit is southern California’s Imperial county, where an outbreak is taxing the region’s hospital system. In recent weeks, health officials have had to move roughly 500 patients into neighboring regions, burdening their hospital systems, too.

Global Covid-19 Cases Top 10 Million As HHS Secretary Warns ‘Window is Closing’ to Get Disease Back Under Control in US - Confirmed global cases of the coronavirus hit 10 million Sunday, a grim milestone that came as reported deaths from the disease climbed toward 500,000 and a top U.S. health official warned the country’s chances of getting the outbreak back under control were fast disappearing.“This is a very, very serious situation and the window is closing for us to take action and get this under control,” Health and Human Services secretary Alex Azar told CNN‘s Jake Tapper Sunday.NEW: Health and Human Services Secretary Alex Azar warns on CNN that the “window is closing” for the U.S. to get the coronavirus under control, calling the current state of the outbreak a “very, very serious situation.”— Axios (@axios) June 28, 2020Data from Johns Hopkins University, which has tracked the disease for months, showed the total confirmed cases around the world at over 10 million by early Sunday afternoon. Total deaths as of press time had nearly exceeded the 500,000 mark.The U.S. leads the world in total cases with over 2.5 million and in deaths with 125,709. Brazil is a distant second in both categories with around 1.3 million cases and just over 57,000 deaths.  “We are 4% of the world’s population and we are 25% of the cases and the deaths,” House Speaker Nancy Pelosi (D-Calif.) said on an appearance on ABC Sunday. As CNN reported:Thirty-six states are reporting a rise in positive coronavirus cases, and only two are reporting a decline in cases compared to last week.On Friday, the U.S. reported the highest number of new cases in a single day, with at least 40,173 new infections. The previous daily high was reported on Thursday.Several states, including Texas and Washington state, and localities have paused their reopening plans or reimposed some restrictions in hopes of curbing the spread of the virus.President Donald Trump’s management of the disease has been blamed by critics for the nation’s high rate of infection and death count. Trump and members of his administration have blamed a host of other factors, including testing, on the high rate.Former Centers for Disease Control director Dr. Tom Frieden told Fox News Sunday that rationale was simply untrue.“As a doctor, a scientist, an epidemiologist, I can tell you with 100% certainty that in most states where you’re seeing an increase, it is a real increase,” said Frieden. “It is not more tests, it is more spread of the virus.”

Coronavirus dashboard for June 29: renewed exponential growth in infections, decline in deaths has stalled

  • Total US infections: 2,549,069,  42,161 in last day
  • Total US deaths: 125,803,  273 in last day

Here is the regional breakdown of the 7 day average of new cases per capita: There is renewed exponential growth in the South and West. The Midwest also is beginning to look bad. Also, here is some more evidence that, when you recklessly reopen, and the pandemic roars back, customers pull back, thus defeating the entire purpose of “reopening the economy:” The scientific phrase for this phenomenon is, “Well, duh!” The “top 10” States for new infections per capita are now dominated by the Confederacy, plus Arizona and Utah: However, while Arizona now heads the “top 10” jurisdictions for deaths per capita, and Louisiana, Arkansas, and Florida have joined the list, the majority is still from the Northeast megalopolis where the death rate, while steeply declining, remains high: I expect the Northeastern States and DC to drop out of this list over the next 7 to 10 days. Aside from the situation in the recklessly reopened States, the big issue has been the disconnect between new cases and deaths. The main driver is almost certainly the demographic change from older to younger victims. An important sub-part of that change may be that nursing homes, the “dry tinder” that were first struck by the pandemic, are no longer the epicenter. One complication in making sense of the data is that NJ had a big data dump of reassigned death rulings earlier last week: So, the below two graphs take the NYC metro area, including NJ, out of the data, and compare the remaining 47 States plus DC. Here is the 7 day growth in new cases: This looks very much like the exponential growth we were seeing back in March. Now, here is the 7 day change in deaths: There has been a very slight decline over the past 10 days of the 7 day average. The change in trajectory of deaths happened roughly one week after the new exponential growth in infections started. Because the young are not totally invulnerable from dying of the disease, I expect the death rate to slowly start rising, pretty much imminently. One final note. How much did the Black Lives Matter protests affect new cases? Obviously social distancing went out the window, but the protests were outdoors and by all accounts almost all of the protesters wore masks. Since the protests started in Minnesota on May 25, 35 days ago, the effects ought to be apparent in cases by now. So here is what Minnesota looks like: New infections continued to decline for 25 days, but have risen slightly in the past 10 days. This suggests, thankfully, that the protests will have little effect on the trajectory of new cases.

Cuomo expands New York quarantine order to 8 additional states - New York Gov. Andrew Cuomo (D) expanded the state’s mandatory quarantine to include travelers from eight additional states experiencing spikes in coronavirus cases.  The mandatory 14-day quarantine now includes travelers from California, Georgia, Iowa, Indiana, Louisiana, Mississippi, Nevada and Tennessee. If you're traveling to New York from the following states you must self-quarantine for 14 days. The states are: AL, AR, AZ, CA, FL, GA, IA, ID, LA, MS, NC, NV, SC, TN, TX, UT. — Andrew Cuomo (@NYGovCuomo) June 30, 2020   Last week New York, New Jersey and Connecticut announced a joint travel advisory requiring travelers from states with an infection rate above 10 cases per 100,000 people on a seven-day rolling average to quarantine when entering their states.  The order at the time applied to travelers from Alabama, Arkansas, Arizona, Florida, North Carolina, South Carolina, Washington, Utah and Texas.  New York, once the epicenter of the coronavirus pandemic, has made progress mitigating its spread. But other states, mainly in the South and West, have seen significant surges in COVID-19 cases, causing officials in some cases to pause reopening plans or reimpose restrictions that had been lifted.  Cuomo has said that people found breaking the order could be subject to fines, but he indicated that police would not be patrolling the borders of the state.

Food processing plants in Ohio and New York hit with outbreaks - The number of workers in food processing plants infected with coronavirus continues to grow. More than 230 workers at a Dole Foods salad processing plant in Springfield, Ohio, have now tested positive for COVID-19. Last week, 82 workers or 46 percent of the workforce also tested positive at Champlain Valley Specialty of NY, a company that packages sliced apples in upstate New York. Dole Foods as well as county and State of Ohio health officials have refused to close the plant despite the fact that more than a quarter of the plant’s 829 workers have now tested positive. Dole management has known for a long time that COVID-19 was spreading among its employees. The first positive case was back in April. Yet the company failed to close and thoroughly clean the plant to prevent the spread of the virus. On Saturday, June 20, the health officials organized the testing of everyone at the plant. Infected workers continued to work while their test results were pending. Barry Scuttles, who works at the plant, told local TV station WHIO-TV, “The proper thing to do was shut the place down until all the tests came back. Keep all the positives at home and then bring the other workers back.” Scuttles said he personally had to inform three co-workers that they were positive and pull them from the line. In a statement, Dole rejected closing, citing conversations with county health officials that “the plant is not likely the source of transmission and closure is not warranted.” Such an absurd statement exposes the contempt of these giant corporations for the working class. Regardless of where the source of transmission began, the plant is now a vector for the transmission of the disease. To ignore that the virus is spreading between workers is not just neglect but an act of corporate murder. Many workers are worried about safety but are concerned about speaking out. The State of Ohio has now declared three ZIP codes around the plant as hot spots for virus. Scuttles told WHIO-TV “Corporate America is worried about money. They’re not worried about their workers. I can get another job. I can’t get another life.”   Workers are now reportedly being forced to work 12-hour shifts to make up for the time lost by infected employees missing work.

Reopening Of Popular Michigan College Bar Results In 85 COVID-19 Infections   A popular bar near Michigan State University's campus in East Lansing was site of a recent 'super spreader' event. This single location has been reportedly linked to at least 85 confirmed COVID-19 cases, a number expected to climb given that health authorities are now desperately announcing that anyone who visited Harper's Restaurant and Brew Pub between June 12 and June 22 immediately self-quarantine for 14-days. Local media said further that a recent cluster of 30 infections 100 miles away are also linked to the bar. According to Fox News: Eighty of the cases involve individuals who visited the bar and then tested positive, WLIX-TV reported. Most of those infected have only shown mild symptoms. At least 10 have been asymptomatic. College students without masks could be seen in photos on social media crowded together on a line to get into Harper's after the bar reopened June 12 when Michigan eased coronavirus restrictions that had shuttered bars and restaurants for three months. The business closed again June 22, shortly after two people tested positive for the coronavirus, the station reported.

South Carolina emerges as new COVID-19 hot spot - South Carolina has emerged as a national hot spot for the spread of COVID-19. A record 1,599 new cases were announced on June 27. Since then, the numbers have only been slightly lower, with 1,366 new cases reported on Sunday and 1,320 reported on Monday. However, the percentage of positive test results has increased precipitously from 9.6 percent on June 14 to 20.1 percent on June 27, indicating a vast underestimation of the actual number of active cases. As of this writing the official death toll stands at 717 confirmed and 3 probable coronavirus deaths. COVID-19 hospitalizations in the state stand at 954. In response to the surge in cases in South Carolina several states have imposed self-quarantine requirements on visitors from the state. A few South Carolina cities including Columbia, Charleston and Greenville, have belatedly instituted mask requirements in the past week. However, Republican Governor Henry McMaster has continued to insist that a blanket mask requirement for the entire state is unconstitutional and unenforceable. South Carolina was among the last to implement measures to contain the spread of the coronavirus and among the earliest to relax them. A statewide “home or work” order was not announced until April 6. Then, in an effort to prepare public opinion for an end to all social distancing requirements, several nonessential businesses were reopened on April 21 even before the “home or work” order was allowed to expire on May 4. On May 4, restaurants were reopened for outdoor seating, forcing restaurant workers back to work even as the virus continued to spread among the general population. On May 12, restaurants were allowed to reopen their dining rooms, further endangering restaurant staff. As cases of the virus rose in mid-June following this series of irresponsible reopenings, Governor McMaster absurdly combined a call for “individual responsibility” in slowing the spread of the virus with the reopening of bowling alleys. Since then, although COVID-19 cases have continued to soar even higher, the governor has insisted repeatedly there will not be another shutdown.

Texas Daily COVID-19 Cases Top Italy's Record When It Was Global Epicenter - Texas reported its latest record-breaking daily increase in cases of the novel coronavirus on Tuesday, with 6,975 new infections identified. The number surpassed Italy's highest single-day jump in virus cases to date, which the nation's health officials confirmed while it was still considered the pandemic's global epicenter. According to data published by the Ministry of Health, Italy saw its highest single-day increase in cases of the novel virus on March 21, with 6,557 new diagnoses. Texas and Italy reported similar weekly average increases in cases surrounding their respective peaks, with both identifying at least 3,500 new infections per day. Italy's record increase came roughly two weeks into the country's national lockdown, which Prime Minister Giuseppe Conte originally implemented March 9. The country continued to diagnose several thousand new cases daily until early May. In Texas, virus cases and related hospitalizations began to multiply at unprecedented rates in early June, one month after businesses started to reopen under Governor Greg Abbott's phased economic recovery plan. Initially implemented May 1, the plan's guidelines allowed restaurants, bars, retail establishments, salons and other businesses to resume in-person services with added safety measures in place throughout the month. A few days into June, Phase III of Texas' recovery plan allowed businesses already operating to expand occupancy limits, while amusement parks reopened for visitors. Texas set new records for daily increases in virus cases almost a dozen times throughout the state's month-long surge. After 24-hour case reports reached new heights on three consecutive days, Abbott announced that Texas would pause further reopening developments indefinitely on June 25. He directed bars to close earlier than previously allowed and lowered occupancy limits for Texas restaurants. His announcement followed the Texas Department of State Health Services' (DSHS) latest case report, which showed 5,551 infections were confirmed the previous day. The next day's report from the Texas DSHS broke a new record, with close to 6,000 cases reported. Texas health officials have confirmed nearly 160,000 virus cases and 2,424 fatalities statewide since the start of the pandemic. The DSHS estimates roughly 72,744 of those cases are currently active, while more than 84,800 individuals previously infected have recovered. The Italian Ministry of Health has recorded more than 240,500 virus cases and at least 34,767 subsequent deaths. It estimates roughly 15,560 people are currently infected.

Fauci predicts 100,000 new COVID-19 cases per day if US can't control outbreaks - Anthony Fauci, the nation’s top infectious disease expert, warned members of Congress on Monday that the U.S. could reach 100,000 new COVID-19 cases per day if the country does not get a handle on the pandemic. Speaking before the Senate health committee, Fauci said the country is heading in the “wrong direction,” with growing outbreaks in four states accounting for 50 percent new infections in the U.S. “We’re going in the wrong direction if you look at the curves of the new cases,” Fauci said. “We need to do something about that and we need to do it very quickly.” The U.S. is now recording 40,000 new cases per day, surpassing previous records set in April when New York was the epicenter of the outbreak. Now Texas, Arizona, Florida and California are leading the nation in new COVID-19 cases and hospitalizations. However, Fauci stressed that the U.S. can’t just focus on those four states. “It puts the entire country at risk,” he said. Fauci declined to estimate potential COVID-19 deaths when pressed by Sen. Elizabeth Warren (D-Mass.), but said the situation is “going to be very disturbing, I will guarantee you that because when you have an outbreak in one part of the country, even though in other parts of the country they're doing well, they are vulnerable.” "I would not be surprised if we go up to 100,000 [cases] a day if this does not turn around and so I am very concerned," he added.

L.A. County faces 'critical moment' as coronavirus cases keep surging - - Another day of big increases in coronavirus cases and hospitalizations prompted health officials Saturday to warn that Los Angeles County is entering a “critical moment” and that some of the easing of stay-at-home orders is in jeopardy unless the trend changes.Los Angeles and many other parts of California have seen big COVID-19 surges in recent weeks, as the economy has reopened. Officials say it’s essential to follow social distancing rules and other safety regulations.“If we can’t find it in us to follow these mandates, including wearing face coverings and distancing when around others, we jeopardize our ability to move forward on the recovery journey,” Barbara Ferrer, the county health director, said Saturday in a statement. “Our collective responsibility is to take immediate action, as individuals and businesses, to reverse the trends we are experiencing.”Los Angeles County public health officials on Saturday reported 2,169 new coronavirus cases.The county also reported 23 coronavirus-related deaths, bringing its total to more than 95,500 cases and nearly 3,300 deaths. There were 1,698 confirmed coronavirus patients in county hospitals, an increase from the 1,350 to 1,450 daily hospitalizations the county was seeing two weeks prior, officials said.This comes a little over a week after the county permitted the latest round of business sectors, including bars, nail salons and tattoo parlors, to reopen, and about a month after hundreds of thousands of people began taking to the streets for protests decrying the police killing of George Floyd and other Black Americans. The alarm over the rising case numbers extends across California, where statewide cases approached 210,000. Some officials are cracking down on scofflaw businesses while others are preparing to help overwhelmed hospitals.

Coronavirus: California shatters another record for daily cases -For the second time in the past week, California on Monday blew its previous daily COVID-19 case record out of the water, and practically across the Pacific. Hospitals are beginning to near capacity in parts of the state, while more regions have put their reopening plans on hold amid what one local health official described as an “alarming” surge in cases.Health departments around the state reported 8,184 new positive tests Monday, shattering the previous record set last Monday and raising the total count to more than 222,000, according to data compiled by this news organization. While data on Monday can be inflated from reporting delays over the weekend — and this past weekend, some counties weren’t able to access CalREDIE, the state’s reporting system — the 8,184 new cases is 25% higher than any previous Monday. Before last Monday, the state hadn’t experienced a single day of 5,000 cases; now, it is averaging well over 5,000 a day — 5,475 over the past week. That is 33% higher than a week ago, despite the number of tests increasing 20% in that time.In Los Angeles County alone, there were nearly 3,000 new cases — more than all but three states on Monday.“The alarming increases in cases, positivity rates and hospitalizations signals that we, as a community, need to take immediate action to slow the spread of COVID-19,” Dr. Barbara Ferrer, the Los Angeles County public health director, said in a statement. “Otherwise, we are quickly moving toward overwhelming our healthcare system and seeing even more devastating illness and death.” The statewide positive-rate of tests over the past seven days is 5.9%. As recently as two weeks ago, an average of 4.6% of tests were coming back positive, indicating the increase is cases is attributable to more than increased testing. Cases Both rates, however, pale in comparison to other states where cases are spiking. In Florida, 15.6% of tests were coming back positive, while in Arizona, the positivity rate was 24.4%. California is also now testing more people than all but five states at a rate of 2.4 tests per 1,000 residents. Seventeen states have a higher positivity rate than California.

Arizona reports record spike in new coronavirus cases and deaths ahead of Pence's visit - The Arizona Department of Health Services on Wednesday reported nearly 4,900 new coronavirus cases and 88 new deaths, a record single-day jump in both grim markers ahead of Vice President Mike Pence's visit to the state later in the day. The coronavirus has infected a total of 84,092 people and killed 1,720 people in Arizona so far. The state's previous single-day high in the number of additional cases was 3,593 on June 23 ahead of President Donald Trump's scheduled event in Phoenix. While an increase in Covid-19 testing and a potential lag in data reporting of the daily case numbers could account for the rise in positive cases, the number of hospitalizations in Arizona has steadily increased over the past weeks. According to a CNBC analysis of data compiled by the Covid Tracking Project, Arizona as of Tuesday reported 2,516 people currently hospitalized on a seven-day average, a near 35% increase compared with a week ago. Arizona is nearing max capacity of intensive care unit beds with 1,495, or 89%, of the state's ICU beds in use as of Tuesday. The number of ventilators being used at hospitals also reached a record high of 795, according to the state's department of health. Arizona Gov. Doug Ducey rolled back the state's reopening plans and closed all bars, gyms, movie theaters and water parks Monday. He said Arizona will try to restart the businesses in 30 days. "We can't be under any illusion that this virus is going to go away on its own. Our expectation is that next week our numbers will be worse. It will take several weeks for the mitigation that we have put in place and are putting in place to take effect," Ducey said. The record surge in daily coronavirus cases comes as Pence is scheduled to arrive in Phoenix later on Wednesday to meet Ducey to discuss the state's effort to curb the spread of the virus. The trip was pushed back by a day. Last weekend, Pence postponed his "Faith in America" 2020 campaign events in Arizona and Florida "out of an abundance of caution." No new dates for the tour have been disclosed but the vice president announced that he will still travel to Texas, Arizona and Florida this week to meet governors and health experts about response efforts to Covid-19. 

Arizona Department of Health Services activates plan to ration healthcare for COVID-19 patients - The state of Arizona, and the American Southwest more generally, have become a new epicenter of the coronavirus pandemic. This region was among the first where state governments ended lockdowns and other restrictions, and record infections and rising deaths are the consequence. On Wednesday, Arizona, with over 84,000 cases (24,118 cases in one week), surpassed its previous one-day high set on Tuesday with 4,877 new cases and 88 fatalities. The death toll for Arizona stands at 1,720 (257 deaths since last week). With a per capita infection rate of 43 new daily cases per 100,000 residents on a seven-day rolling average, Arizona leads nationally, with Florida second with 34 new cases per 100,000 residents. By way of comparison, New York state with 2,009 total cases per 100,000 residents experienced a one percent rise since June 24. Arizona, with 1,290 total cases per 100,000, experienced a 40 percent increase. With testing capacity strained, 28 percent of diagnostic tests are returning positive, which indicates both dwindling resources as well as a significantly entrenched community transmission. Last Friday, Arizona hospitals asked their state’s health department to formally activate the “Crisis Standards of Care” guidelines that would provide hospitals the legal right to determine who and how patients should be treated for the coronavirus. This essentially means hospitals will have to decide who receives life-saving measures and who will not. Throughout June, the local media, via updates from the health department, had been highlighting Arizona hospitals’ dwindling ICU capacity. The plan ushered in with the words “a compassionate and ethically-based healthcare response for catastrophic disasters within the State of Arizona” went into effect Monday afternoon. The Arizona Department of Health promulgated a COVID-19 addendum for the allocation of scarce resources in acute care facilities back in April during the initial surge of the pandemic in the United States. Health systems throughout the country were facing severe shortages of PPEs and testing capacity. Based on estimates provided by various health officials, concerns were raised that there would be insufficient capacity to ventilate patients. Equally distressing was the shortage of critical care capacity at health systems overwhelmed by COVID-19 cases.  Infected patients who have arrived for life-saving treatments and critical care at the hospital will have to first undergo an assessment on “the best available relevant and objective medical evidence.”

Arizona Covid-19 Cases Jump 5.1%, Exceeding 4.7% Weekly Average - Arizona reported 4,433 new Covid-19 cases on Friday, a 5.1% rise from a day earlier but below the record set Wednesday. Cases have been rising at a 4.7% rate over the past seven days and now stand at 91,858. The state had 4,878 new cases on Wednesday, the most for a day. The state reported 31 new deaths, down from a record 88 on Wednesday, putting the total at 1,788. Fatalities among those over age 65 accounted for 73.5% of all state deaths, according to the Department of Health website. Arizona Governor Doug Ducey announced on Monday the state would impose a month-long closure of bars, gyms, movie theaters, water parks and tubing rentals.

US daily coronavirus cases jump by more than 50,000 for first time - The number of new US daily coronavirus cases surpassed 50,000 for the first time ever on Wednesday, propelled by record rises in some of the most populous states, including California and Texas.The surge in cases has increased concerns about the speed at which the disease is spreading in emerging US hotspots ahead of the July 4 holiday weekend. A further 52,982 people in the US tested positive for coronavirus over the past 24 hours, according to Covid Tracking Project, topping the previous record increase from June 26 by more than 8,600. Throughout the month of June, the daily case rate in the US rose 105 per cent. California, which had some of the earliest cases of coronavirus in the US, had largely escaped the early wave of cases that hit states such as New York in the north-east. However, that trend has reversed in recent weeks, after it began to loosen some restrictions. The state’s health department reported 9,740 cases since Tuesday, taking the total number of positive cases there to almost 233,000. Texas reported 8,076 cases, topping a record set the previous day by more than 1,100, with 57 deaths — the biggest one-day increase since the middle of May.  Hospitals in some parts of Texas, which was among the last US states to lock down and first to reopen, have been overwhelmed by the sudden rise in cases. More than 6,900 people are hospitalised there as of July 1, a record for America’s second most populous state.Houston-based Texas Medical Center — the largest hospital system in the US — revealed on Wednesday there were 1,350 patients in its intensive care unit wards in the area, surpassing normal capacity of 1,330. Patients with coronavirus accounted for 36 per cent of those beds. Arizona also reported a record one-day rise in cases, with 4,878 people testing positive over the past day, and a record 88 deaths, the state’s health department said. Mike Pence, the US vice-president, was in the capital Phoenix on Wednesday to discuss the situation with state and local officials. The relentless increase in cases in some states, particularly in the US south and west, has prompted businesses and local governments to slow, halt or reverse reopening plans, as optimism that the worst of the pandemic has passed continues to fade.

 US posts largest single-day jump in new COVID-19 cases - The Centers for Disease Control and Prevention (CDC) today reported a record of 54,357 new coronavirus cases over yesterday—a record single-day jump that presses the United States further than what some thought was the peak this spring. For reference, as CNN reported, it took the United States a little more than 2 months to report its first 50,000 cases. Total US cases were at 2,679,230, including 128,024 deaths, according to the CDC. The infection curve is rising in 40 of 50 states, and 36 states are seeing an increase in the percentage of positive coronavirus tests, AP reported today. Some public health officials and governors are blaming bars for the increase in cases, the New York Times reported today, while others are pointing to hasty business reopenings, according to Politico. Without directly acknowledging the recent surge of new cases, Trump said that, along with governors, the White House was working at "putting out the flames or the fires, and that's working out well."  Trump said that states will decide how quickly to reopen their economies but that "we'd like to see churches open quickly."  However, economists caution that the situation isn't nearly as rosy as it might seem, with at least 10 million more jobless Americans than before the pandemic, and millions are still applying for unemployment benefits weekly, CNBC reported. At the same time, Vice President Mike Pence said that the White House would "keep opening up America" despite the surge in COVID-19 cases, according to CNBC.  Florida set a state record for daily new coronavirus cases when it passed the 10,000 mark,Reuters reported. Florida infections increased 168% in June when it recorded more than 95,000 news cases. Since the end of May, positive test results have risen to 15%, a 9% increase. Only one other state, New York, has recorded more than 10,000 cases in a single day, at 12,847 on Apr 10, 3 weeks after the state issued stay-at-home orders. In fact, no European country reported more new daily cases than Florida at the peak of their outbreaks.Arizona reported 4,878 cases, including 88 deaths, for a total of 87,425 cases and 1,757 deaths, with Governor Doug Ducey calling for an additional 500 healthcare workers yesterday, Yahoo Newsreported. In Texas, Governor Greg Abbott today issued an executive order that requires face coverings in counties with 20 or more positive cases and limiting gatherings to 10 or fewer people. Also, theTexas Tribune reported that more than 300 kids in childcare centers and 460 staff members have tested positive for COVID-19; more than 8,100 new cases were recorded on Wednesday. In California, where some businesses are again being shut down amid rising cases, new cases were at 7,600, according to the New York Times.North Carolina, Tennessee, and Texas all set single-day records on Wednesday, and the formerly stable-appearing states of Ohio, Kansas, and Louisiana reported some of their highest single-day tallies in weeks. Only Nebraska and South Dakota were reporting a downward trend in cases, according to the AP.

U.S. Breaks World Record With More Than 55,000 New Coronavirus Cases in a Day The U.S. reported more than 55,000 new coronavirus cases on Thursday, in a sign that the outbreak is not letting up as the Fourth of July weekend kicks off.Thursday's tally of 55,274 new cases was both more than the country has reported on any single day so far and more than any other country has reported over 24 hours, according to Reuters figures. The previous record was held by Brazil, which reported 54,771 cases on June 19.Thursday's high caseload is not an isolated incident. The U.S. has reported more than 40,000 new cases each day for seven days in a row and has broken records for new cases three days running, according to Reuters data. Thursday was also the second consecutive day that the daily tally topped 50,000, The Financial Times reported."What we've seen is a very disturbing week," National Institute of Allergy and Infectious Diseases Director Dr. Anthony Fauci said in a livestream with the American Medical Association, The Associated Press reported Wednesday.It also doesn't look like the surge in cases is down to increased testing, as some Trump administration officials have suggested in recent weeks."There is no question that the more testing you get the more you will uncover, but we do believe this is a real increase in cases because the percent positivities are going up," Assistant Secretary of Health Admiral Brett Giroir told Congress Thursday, as The New York Times reported. "So this is real increases in cases."In fact, Thursday's total represents a more than 85 percent increase in new cases compared to two weeks ago, when states began to reopen following an extended lockdown. Cases have risen in 40 out of 50 states in the past 14 days, according to COVID Tracking Project data reported by The Associated Press, and the number of tests coming back positive has risen in 36 states. Eight states set individual records for their highest case tally Thursday, The New York Times reported. They were Alaska, Arkansas, California, Georgia, Montana, South Carolina, Tennessee and Florida, which reported more than 10,000 cases for the first time.

832 new virus cases reported in Pa., marking highest daily jump in weeks - - Pennsylvania health officials reported more than 800 new COVID-19 cases on Thursday. There were 832 new cases, the highest daily jump since May 22, according to health department data. That pushes the statewide total to 88,074 since March. Lehigh and Northampton counties saw an increase of 22 and 16 respectively, while Berks County had just 4 new cases. The state health department also reported 25 more virus-related deaths, making 6,712 total. Pennsylvania has seen an uptick in new cases since mid-June, as officials in Allegheny County and Philadelphia have taken steps to impose new restrictions or keep them in place. On Wednesday, Gov. Tom Wolf expanded his mandatory mask order to include all public places, indoor and outdoor, where consistent social distancing is not possible. Wolf also said Wednesday he doesn't envision another broad shutdown order to contain the coronavirus and, rather, hopes to let local governments make decisions based on conditions they are seeing in their area.

Florida shatters records with over 10,000 new COVID-19 cases in single day -  (Reuters) - Florida shattered records on Thursday when it reported over 10,000 new coronavirus cases, the biggest one-day increase in the state since the pandemic started, according to a Reuters tally. Outbreaks in Texas, California, Florida and Arizona have helped the United States break records and send cases rising at rates not seen since April. In June, Florida infections rose by 168% or over 95,000 new cases. The percent of tests coming back positive has skyrocketed to 15% from 4% at the end of May. Florida, with 21 million residents, has reported more new daily coronavirus cases than any European country had at the height of their outbreaks. To contain the outbreak, Florida has closed bars and some beaches but the governor has resisted requiring masks statewide in public or reimposing a lockdown. Only one other state has reported more than 10,000 new cases in a single day. New York recorded 12,847 new infections on April 10, three weeks after the state implemented a strict lockdown that closed most businesses. While the state has relaxed many measures, it requires masks in public and mandates anyone arriving from 16 other U.S. states with high infections self-quarantine for two weeks. Once the epicenter of the U.S. epidemic, New York saw cases rise by about 6% in June - the lowest rate in the entire country.

Infectious disease specialist: Florida 'heading a million miles an hour in the wrong direction' - An infectious disease specialist is warning that Florida is "heading a million miles an hours in the wrong direction" on its handling of the coronavirus pandemic. "Right now, we are heading a million miles an hour in the wrong direction," Dr. Aileen Marty, an expert who helped write Miami-Dade's reopening rules, told "CBS This Morning." She added, however, that people are not properly following the rules and it's playing a role in rising cases of COVID-19 in the area. "It's absolutely the saddest thing, the most unnecessary situation that we're finding ourselves in," Marty said. "And it's behaviorally driven." Her warning comes as Florida recorded 10,109 new COVID-19 cases on Wednesday, the highest single-day increase for the state. There are now more than 175,000 confirmed cases in Florida. The state has seen back-to-back record-breaking days of coronavirus cases and Gov. Ron De Santis (R) has said the state will not reverse course on its reopening. “We're not going back, closing things,” he said on Wednesday. “I don't think that that's really what's driving it. People going to a business is not what's driving it. I think when you see the younger folks — I think a lot of it is more just social interactions, so that's natural.” The climbing cases have prompted fears of further outbreaks by July Fourth weekend gatherings. In response to those concerns, Miami-Dade County in announced it was imposing a curfew this weekend. Infectious disease expert: Trump Mount Rushmore event is 'beyond... Study ties hydroxychloroquine use to lower COVID-19 death rate The curfew, starting Friday night at 10 p.m. and lasting until 6 a.m., will be implemented “until further notice,” said Carolos Gimenez, the county's mayor. Florida is one of the states being hit hardest by COVID-19 right now, making up about 20 percent of new cases in the U.S.

Several US states post record Covid-19 cases, curfew ordered  in Miami - Alabama and six other U.S. states reported record increases in coronavirus cases on Friday as Florida's most populous county imposed a curfew ahead of the Independence Day weekend and Arkansas joined a push toward mandating mask-wearing in public.North Carolina, South Carolina, Tennessee, Alaska, Missouri, Idaho and Alabama all registered new daily highs in cases of COVID-19, the illness caused by the novel coronavirus. Texas hit a new peak for hospitalizations, with one doctor calling for a "complete lockdown" in the state o get the virus under control.The daily U.S. tally of cases stood at 53,483 late on Friday, below the previous day's record 55,405.The recent surge, most pronounced in southern and western states, has alarmed public health officials, who urged caution ahead of a July 4th holiday weekend to celebrate the Declaration of Independence of the United States in 1776.North Carolina, for one, reported 951 hospitalizations and 2,099 cases, both record highs.Bill Saffo, mayor of Wilmington, North Carolina, said many infections had been traced to large gatherings and predicted a further jump after the holiday weekend as people disregarded guidelines on social distancing and masks."We know that the spread is going to happen. We know probably in about two weeks we'll see a spike from the July 4th weekend," Saffo told CNN.Despite the jump in infections, the average daily death count in the United States has gradually declined in recent weeks, a reflection of the growing proportion of positive tests among younger, healthier people who are less prone to severe outcomes.However, U.S. Surgeon General Jerome Adams warned that the impact on fatalities from the recent surge, which started in mid-June, had yet to be seen. "Deaths lag at least two weeks and can lag even more," he told "Fox & Friends" on Friday.

Alabama Records Its Biggest Rise in COVID-19 Cases with 1,758 Jump - Led by the Birmingham, Huntsville and Mobile areas, Alabama experienced its worst day yet in the spread of COVID-19, the Alabama Department of Public Health reported Friday. The agency’s COVID dashboard showed 1,758 new confirmed cases of the disease in its 24-hour report. That brought the total to 41,362 since the pandemic began in March. Another 507 cases were listed as probably from the virus, but not yet confirmed. The number of deaths rose by 22 for a total of 983, plus 24 that are probably from the disease but still under study. The daily figures reflected a dramatic increase in the growth of COVID-19. Statistics this week showed an average daily increase of 974 for the seven-day period thorugh Wednesday and an average increase of 823 a day for the 14-day period. Jefferson County reported one of its biggest spikes on Friday, with 270 new confirmed cases to bring its total to 4,802. The state’s most populous county also listed nine deaths for a total of 152. Jefferson leads the state in both of those categories. Madison County, home of Huntsville, had 167 new cases for a total of 1,271 but its death toll remained at seven. Mobile County reported 104 cases to raise its total to 3,904; its death count remained at 134. Montgomery County, which had been the state’s covid hotspot during part of June, listed 72 cases to raise its total to 3,947, second behind Jefferson. It had one death for a total of 103,

State reports record new COVID-19 cases Friday — The number of confirmed COVID-19 cases in Carteret County remains at 104 heading into the Fourth of July holiday weekend as the state reports a record number of new cases Friday. As of Thursday, 41 of the 104 confirmed COVID-19 cases in Carteret County were considered active. Statewide, North Carolina reported a record 2,099 new COVID-19 cases Friday. It is the first time the single-day case increase has exceeded 2,000 and marks the 10th day in a row the state is reporting more than 1,000 new daily cases. Hospitalizations in North Carolina also hit a new single-day record Friday with 951 patients currently hospitalized. “We are seeing significant spread of the virus and it is very concerning,” N.C. Department of Health and Human Services Secretary Dr. Mandy Cohen said in a statement Friday. “Today we have the highest reported day of new cases and hospitalizations — and that should be a warning to us all as we go into this holiday weekend. We don’t get a holiday from COVID-19. We all need to wear a face covering, avoid crowds

Is the coronavirus pandemic entering a second wave? - As countries around the world relax Covid-19 restrictions and some areas see an increase in infections, questions are being raised about whether the pandemic is entering what is known as a second wave. In the United States, where new cases had levelled off at roughly 20,000 a day for a period of weeks, infections have again spiked. The US on Friday reported one of its largest single-day increases since the start of the pandemic, with more than 40,000 new cases on the previous day, according to data from the Centres for Disease Control and Prevention. On Thursday, the World Health Organisation’s regional director for Europe Hans Kluge said 30 countries and territories in the region had seen increases in new cumulative cases in the past two weeks as they eased social distancing measures, with 11 of those experiencing a “significant resurgence”.But whether this means such areas are seeing a second wave remains unclear, largely due to the ambiguity of the term, experts say. Many caution against declaring a new rise in case numbers in areas or countries where cases had appeared to decline as a “second wave”, since an uptick of cases as social distancing restrictions are relaxed did not necessarily mean the start of a new cycle – or the end of old one – especially if there was still a significant amount of transmission. Anthony Fauci, director of the US National Institute of Allergy and Infectious Diseases, speaking in a June 18 interview with The Washington Post, said the United States was still in the first wave, even as case rates decline and increase at different times in various regions of the country. “But no one has really defined the scale that is required to call a second wave, either in terms of the time, or space, or the scale of the [case] numbers involved.” Mathews, a former deputy medical officer to the Australian government, said “second wave” was an ambiguous term, and not one “to use loosely”. The second wave phenomenon is most widely associated with past influenza pandemics. The 1918 flu pandemic, which infected 500 million people and killed 50 million worldwide, is infamous for its far deadlier second wave in the autumn, months after the first wave. A third wave occurred in a number of countries in 1919. Mathews said influenza-like second waves could be driven by a change in the virus or shifts in people’s behaviour, with changes in the virus thought to play a role in the second wave in 1918. Immunity had developed among a sufficient proportion of the population which drove the flu virus to evolve to “dodge immune response” and continue to infect people, he said. 

 Excess Deaths, March-May 2020 - Menzie Chinn -From “Estimation of Excess Deaths Associated With the COVID-19 Pandemicin the United States, March to May 2020,” JAMA, today:  Across the United States, there were 95 235 reported deaths officially attributed to COVID-19 from March 1 to May 30, 2020. In comparison, there were an estimated 122 300 (95% prediction interval, 116 800-127 000) excess deaths during the same period (Table). The deaths officially attributed to COVID-19 accounted for 78% of the excess all-cause deaths, leaving 22% unattributed to COVID-19. The proportion of excess deaths that were attributed to COVID-19 varied between states and increased over time (Table and Figure 1). Figure 1: Excess Deaths in the United States From March 1 Through May 30, 2020. The observed number of deaths is indicated by the solid line, and the expected number of deaths, adjusting for seasonality, influenza epidemics, and reporting delays, is indicated by the dashed line. The area between these 2 lines represents the total number of excess deaths: blue-gray (bottom), deaths recorded as due to COVID-19; orange (narrow middle section), additional pneumonia and influenza excess deaths not coded as due to COVID-19; and beige (top), deaths that were not attributed to COVID-19, pneumonia, or influenza. This implies a point estimate for undercount of Covid-19 fatalities by 27,000 for the March-May period.(This approach is not persuasive if you thought the excess deaths were primarily people who were going to die in the very near future; for examples, see the excess fatalities debate for Puerto Rico/Hurricane Maria.)

Pandemic surpasses 10 million COVID-19 cases and over 500,000 deaths globally - Over the weekend, the number of COVID-19 cases surpassed the 10 million mark as the pandemic accelerated throughout North and South America, the Indian subcontinent, the Middle East and South Africa. As of this writing, the Worldometer coronavirus tracker had logged 10,196,711 cases. In another grim milestone, the number of global deaths due to COVID-19 rose above 500,000, standing at 503,149. The number of serious and critical cases has also begun to climb again. On Saturday, the United States posted a one-day high of 47,341 new COVID-19 cases, fueled by the reckless and premature “reopening” of the country. Brazil also posted another massive one-day total of 46,907 COVID-19 cases, pushing the global number of new cases close to 200,000. In addition, the number of fatalities internationally has been slowly climbing since May 27. A truck deliver coffins to a funeral store in Santiago, Chile. (AP Photo/Esteban Felix) By all accounts, most European countries have been faring better on the basis of a more measured lifting of lockdowns, having turned case numbers down sharply and reduced fatalities to the single digits, with the exception of the United Kingdom and Russia, which posted 100 and 188 deaths yesterday, respectively. However, on June 25, Hans Henri Kluge, the World Health Organization regional director for Europe, reported that Europe had seen an increase in weekly cases for the first time in months. “Thirty countries and territories have seen increases in new cumulative cases over the past two weeks,” he said. “In 11 of these, accelerated transmission has led to a very significant resurgence that, if unchecked, will push health systems to the brink once again in Europe.” South America, with 2.1 million cases, recorded 52,943 new COVID-19 cases and 2,664 deaths. Brazil continues to remain the epicenter of the pandemic, with 35,887 new cases yesterday and 994 fatalities. Presently, only hospital patients can be tested there, making its per capita testing abysmally low. At a health ministry briefing this weekend, officials indicated that plans were being worked out to acquire 46.5 million tests by the end of the year. In only two weeks, COVID-19 cases have soared from 867,000 to 1,344,000, an increase of nearly one-half million. With its high crude case fatality rate of 12.4 percent, Mexico’s cases continue to accelerate, and deaths continue to climb. There are now over 213,000 cases and more than 26,000 deaths.

Brazil set to pass 1.5 million coronavirus cases, cities reopen anyway (Reuters) - Brazil was set to pass 1.5 million confirmed coronavirus cases on Friday, as the virus continues to ravage Latin America’s largest country even as cities reopen bars, restaurants and gyms sparking fears infections will keep rising. Brazil has the world’s second largest outbreak after the United States and the virus has killed over 60,000 people in the country. In Rio de Janeiro, crowds gathered to drink on the sidewalk of an upscale beach-side neighborhood on Thursday night, the first evening bars in the city were allowed to reopen. Pictures of the revelry in Leblon, where few were wearing face masks and people were huddled close together, went viral on social media drawing condemnation and concern. “A tragedy foretold,” David Miranda, a federal congressman for Rio, wrote on Twitter above a picture of the crowded sidewalk. He criticized the city’s mayor Marcelo Crivella. “Crivella’s decision to throw open the doors of business will come with a high cost,” he added. In Rio alone, more than 6,600 people have died of COVID-19 in the past four months. Only 14 countries in the world have a death toll higher than the city. Intensive care units in public hospitals are at 70% capacity. Sao Paulo, Brazil’s largest and worst hit city, is expected to open bars and restaurants next week. President Jair Bolsonaro has been widely criticized by health experts for downplaying the severity of the virus which he has dismissed as just “a little flu.” Bolsonaro has pressured governors and mayors for months to reverse lockdown measures and reopen the economy.

Coronavirus live news: Brazilian cases pass 1.5m – as it happened  - Here’s the coronavirus news for Friday:

  • There are now 11m confirmed cases of coronavirus worldwide
  • The US reported a daily global record of more than 55,000 new coronavirus cases on Thursday as infections rose in the vast majority of states and America’s top public health expert spoke of a “very disturbing week”. Thursday’s tally topped the previous single-day record of 54,771 set by Brazil on 19 June.
  • The US will be on a “red list” of high-risk countries that people in England are advised not to visit for non-essential reasons because of its continued high level of coronavirus cases, the UK government said.
  • The UK prime minister, Boris Johnson, stood by his decision to allow pubs, bars and restaurants to reopen in England on a Saturday despite concerns from the public that it could put extra strain on the police and the health service.
  • Cases of coronavirus are surging in South Africa, a month after the country lifted most of the restrictions brought in with one of the world’s strictest lockdowns. On Thursday, authorities reported the country’s biggest single-day jump in coronavirus cases, adding 8,728 confirmed infections and taking the total count to 168,061.
  • The number of confirmed cases of coronavirus in Iraq increased sevenfold in June, the International Rescue Committee said as it urged a redoubling of efforts to contain the spread of the disease in the country. By 1 July there had been 53,708 infections detected in the country, up from 6,868 on 1 June. The ministry of health said that hospitals are almost at full capacity.
  • A fresh state of emergency was declared in Belgrade, with a number of restrictions restored after a new increase in coronavirus infections in the Serbian capital. Local authorities across the country had already declared emergencies in several other municipalities where a rise in coronavirus cases had threatened to disrupt the functioning of the health system.
  • The Philippines reported its highest single-day increase in coronavirus infections, with 1,531 new cases detected in the past 24 hours, bringing the national total to 40,336. The country’s Covid-19 death toll has reached 1,280, after 12 more deaths from the disease.
  • Life in Russia is unlikely to return to normal until next February at the earliest, the country’s health minister said. Many restrictions have already been eased, but with thousands of new cases still being reported every day, and a death toll approaching 10,000, some measures remain in force, including a ban on international flights, extended on Thursday until August.

Mexico vastly underestimating virus death toll, studies say Mexico has been grossly underestimating its Covid-19 death toll, according to a growing number of independent studies suggesting there have been tens of thousands of deaths in excess of the official count, casting doubt on president Andrés Manuel López Obrador’s insistence that the pandemic has been tamed. As of Friday, Mexico has officially reported 283,511 infections and 29,189 deaths among its 129m population. But the true picture may be far worse. One study by independent researchers Mario Romero and Laurianne Despeghel shows at least 3.5 times more deaths in Mexico City than the official data, an undercount of some 22,705 deaths in the capital alone. In another, Raúl Rojas, a Mexican professor of artificial intelligence at Berlin University, calculated that Mexico could have as many as 6m cases and nearly 78,000 deaths — almost three times the official count. “I find it incredible that instead of giving numbers, they’re hiding them to conceal the seriousness of the situation,” he said. More than half the world’s average daily deaths from the virus are now in Latin America, making it one of the global centres for Covid-19. Brazil has the world’s highest official number of daily deaths, but with an average of 4.7 new deaths per 1m people in the last week, Mexico and Brazil are neck and neck in proportion to population. Mexico is only counting cases and deaths that have been confirmed by a laboratory — and only 610,495 people have been tested. In part because of the low level of testing, some 67 per cent of tests come back positive — an indication that many more cases are being missed.

Coronavirus cases in India: Record 23,500+ cases on Friday, 446 deaths -The Covid-19 pandemic continued to surge in the country as fresh cases rose to another record high on Friday, with over 23,500 reported during the day. With more than 22,000 new infections on Thursday, India’s coronavirus caseload has jumped by about 45,500 in just two days. The death toll from the virus has risen to 18,662 with 446 fatalities recorded on Friday. Covid-19 cases in India stood at 6,49,708, having crossed the 6 lakh mark just two days ago, as per data collated from state governments. Meanwhile, the recovery rate crossed 60%, with more than 3.93 lakh patients having been declared cured. As many as 23,526 new cases were reported on Friday. The spike was again led by Maharashtra, which recorded a new high of 6,364 infections. At least seven other states reported their biggest single-day jump in cases, led by a massive increase of 1,892 in Telangana and 1,694 in Karnataka. The others were Uttar Pradesh (972 new cases), Gujarat (687), Bengal (669), Odisha (561) and Kerala (211). Tamil Nadu became the second state in the country to cross the 1-lakh mark, reporting its second highest count of 4,329 on Friday. Delhi reported 2,520 cases, taking its caseload to over 94,600. The southern states together accounted for nearly 9,000 fresh cases (8,987 to be precise), on the back of a major surge of the pandemic in the region since the past few days. For the second day in a row, Maharashtra added over 6,000 cases to its Covid-19 tally. Friday’s 6,364 cases are the highest so far in a day, beating the previous high of 6,330 cases on Thursday. With this, the total number of cases in the state is now 1,92,990. Maharashtra added 198 deaths on Friday, of which 150 were from the last 48 hours and 48 from previous days. 

 250,000 babies may die indirectly due to COVID-19. Worst-case scenario: 1.2 million babies worldwide - Disruptions to health care and lack of food from COVID-19 are likely to cost the lives of at least 250,000 babies and young children and more than 10,000 mothers in low- and moderate-income countries over the next six months, according to a study from researchers at Johns Hopkins University.The study, published in The Lancet Global Health, modeled how many extra deaths could be expected from COVID-19’s impact on the food supply and medical systems in these countries. The study found a dramatic increase in maternal deaths from the absence of childbirth interventions like antibiotics and clean birth environments. Children will be more likely to die from lack of nutrition, reduced availability of antibiotics for pneumonia, sepsis and rehydration solution for diarrhea, according to the study.In the worst-case scenario, nearly 1.2 million additional babies and about 57,000 mothers would die across the 118 countries in six months, the research found.  “If routine health care is disrupted and access to food is decreased (as a result of unavoidable shocks, health system collapse, or intentional choices made in responding to the pandemic), the increase in child and maternal deaths will be devastating,” the study concluded. “We hope these numbers add context as policy makers establish guidelines and allocate resources in the days and months to come.”

New, more infectious strain of COVID-19 now dominates global cases of virus - Researchers have shown that a variation in the viral genome of Covid-19 improved its ability to infect human cells and helped it become the dominant strain circulating around the world today. The study, published today in the journal Cell, shows the variation is more infectious in cell cultures under laboratory conditions. The variant, named 'D614G', makes a small but effective change in the 'spike' glycoprotein that protrudes from the surface of the virus, which it uses to enter and infect human cells. The D614G variant of Covid-19 quickly took over as the dominant strain soon after it first appeared, with geographic samples showing a significant shift in viral population from the original, to the new strain of the virus. Researchers from the Los Alamos National Laboratory in New Mexico and Duke University in North Carolina, partnered with the University of Sheffield's Covid-19 Genomics UK research group to analyse genome samples published on GISAID, an international resource for sharing genome sequences among researchers worldwide. "We have been sequencing SARS-CoV-2 strains in Sheffield since early in the pandemic and this allowed us to partner with our collaborators to show this mutation had become dominant in circulating strains. The full peer-reviewed study published today confirms this, and also that the new D614G genome mutation variant is also more infectious under laboratory conditions. "Data provided by our team suggested that the new strain was associated with higher viral loads in the upper respiratory tract of patients with Covid-19, meaning the virus's ability to infect people could be increased.

 Patients may be exposed to hormone-disrupting chemicals in medication, medical supplies - --Health care providers may unintentionally expose patients to endocrine- disrupting chemicals (EDCs) by prescribing certain medications and using medical supplies, according to a perspective published in the Endocrine Society's Journal of Clinical Endocrinology & Metabolism. Exposure to EDCs, chemicals that disrupt the body's natural hormones, is most often associated with industrial pollution, contaminated food and water, or personal and home care products. Less appreciated is the fact that some medications and medical devices also contain these harmful chemicals. This includes both prescribed and over-the-counter medications as well as medical equipment used in the hospital, including among the most vulnerable patients in the neonatal intensive care unit. Unfortunately, most healthcare providers are unaware of these risks, and patients are unaware of their exposure. "Through the prescribing of medications and the use of medical supplies, health care providers expose patients to chemicals that can disrupt the body's natural hormones," said the study's lead author, Robert Michael Sargis, M.D., Ph.D., of the University of Illinois at Chicago in Chicago, Ill. "In order to provide ethically sound medical care, the health care community must be made aware of these risks, manufacturers must strive to identify and eliminate endocrine-disrupting chemicals from their products, and patients must be empowered with knowledge and options to make informed decisions that limit their exposure to potentially harmful chemicals. As clinicians, we have an ethical imperative to act on this issue to protect our patients."

Parasite Outbreak in Bagged Salads Sickens More Than 200 in Eight States - A Cyclospora outbreak linked to bagged lettuce has sickened 206 people in eight Midwestern states and sent 23 to the hospital, the Centers for Disease Control and Prevention (CDC) said Friday. No one has died.The outbreak has led to several recalls of salads made at a Fresh Express production facility in Streamwood, Illinois that were sold at major retailers Walmart, Hy-Vee, Aldi and Jewel-Osco, USA TODAY reported."[O]bviously there was some breakdown in the quality chain," Rutgers University food microbiologist Donald W. Schaffner told The New York Times. He said the size and spread of the outbreak suggested "some rather significant sanitary breakdown in the production of this food." The parasite Cyclospora cayetanensis causes an infection called cyclosporiasis when humans eat or drink contaminated food or water, according to the CDC. The main symptom is watery diarrhea, but it can also cause stomach cramping, appetite loss and fatigue. It can last from a few days to longer than a month and is typically treated with antibiotics. The first major foodborne cyclosporiasis outbreak was in the mid-1990s, Schaffner told The New York Times, and no one knows exactly what caused it. The current outbreak marks the third year in a row that there has been an outbreak of the illness during the warmer months.

Flu Virus With ‘Pandemic Potential’ Found in China - BBC -- A new strain of flu that has the potential to become a pandemic has been identified in China by scientists. It emerged recently and is carried by pigs, but can infect humans, they say. The researchers are concerned that it could mutate further so that it can spread easily from person to person, and trigger a global outbreak. While it is not an immediate problem, they say, it has "all the hallmarks" of being highly adapted to infect humans and needs close monitoring. As it's new, people could have little or no immunity to the virus. The scientists write in the journal Proceedings of the National Academy of Sciences that measures to control the virus in pigs, and the close monitoring of swine industry workers, should be swiftly implemented. A bad new strain of influenza is among the top disease threats that experts are watching for, even as the world attempts to bring to an end the current coronavirus pandemic. The last pandemic flu the world encountered - the swine flu outbreak of 2009 - was less deadly than initially feared, largely because many older people had some immunity to it, probably because of its similarity to other flu viruses that had circulated years before. That virus, called A/H1N1pdm09, is now covered by the annual flu vaccine to make sure people are protected.

Chinese researchers: New swine flu has potential to become pandemic - Researchers in China have discovered a new genetic descendant of the H1N1 swine flu virus that they say has the potential to cause a future pandemic. A survey of pig processing facilities in the country's Hebei and Shandong provinces found around 10 percent of pig farm workers have been infected by the disease between 2016 and 2018, while the infection rate among the general population in those areas for that time period is thought to be about 4.4 percent, according to a report from CNN. Experts do not yet believe the virus is transmittable from person to person and say the only hard evidence so far points to the virus being spread from pigs to humans. Symptoms of the virus are reportedly similar to that of the regular influenza virus, which causes fevers, a cough and other common ailments. The H1N1 outbreak, which began in 2009, infected millions of people in the U.S. by the time it ended in 2010. The virus is estimated to have killed between 150,000 and almost 500,000 people worldwide during the first year the virus, according to the U.S. Centers for Disease Control and Prevention (CDC). "This is not a *new* new virus; it's been very common in pigs since 2016," tweeted Carl Bergstrom, a biologist with the University of Washington. "There's no evidence that G4 is circulating in humans, despite five years of extensive exposure. That's the key context to keep in mind."6

A Swine Flu in China Is Spreading to Humans With 'Pandemic Potential,' Scientists Warn - Scientists in China have identified a strain of H1N1 that is rapidly spreading amongst workers in the country's pig farms. They warn that the fast spreading strain of swine flu has pandemic potential, if it is not contained quickly, according to The New York Times. An outbreak of H1N1 caused widespread fear in 2009 when it killed 285,000 people around the world. The new strain is a derivative of H1N1, according to the scientists who published a paper on it on Monday in the scientific journal Proceedings of the National Academy of Sciences (PNAS).The disease, which researchers called the G4 virus, now shows "all the essential hallmarks of a candidate pandemic virus," said the study, as CNN reported.The researchers say that the disease is not yet an immediate problem, but they noted that pig farm workers also showed elevated levels of the virus in their blood, and that "close monitoring in human populations, especially the workers in the swine industry, should be urgently implemented," as Reuters reported.Angela Rasmussen, a virologist at Columbia University's public health school, urged the public to remain calm and not "freak out," according to CNN. "Our understanding of what is a potential pandemic influenza strain is limited," she posted on Twitter. "Sure, this virus meets a lot of the basic criteria but it's not for sure going to cause a hypothetical 2020 flu pandemic, or even be a dominant strain in humans." Chinese researchers based at several institutions, including Shandong Agricultural University and the Chinese National Influenza Center, discovered the G4 virus during a pig surveillance program, according to CNN. Over a seven-year span, from 2011 to 2018, the researchers took more than 30,000 nasal swab samples from pigs in slaughterhouses and veterinary teaching hospitals across 10 Chinese provinces. Those samples revealed 179 swine influenza viruses, but only a fraction of them posed any concern to the researchers, as several only showed up in a single year while others declined to non-threatening levels. The strain in question though, G4 EA H1N1, has been common on China's pig farms since 2016 and replicates efficiently in human airways, according to the study. So far, it has infected some people without causing disease, but health experts worry that means the virus is lurking and mutating into something different and a sudden change can happen without warning, according to The New York Times. Recent evidence "indicates that G4 EA H1N1 virus is a growing problem in pig farms, and the widespread circulation of G4 viruses in pigs inevitably increases their exposure to humans," the study said. In the last three years of the study, researchers collected blood samples from workers on various pig farms and from people in nearby households. The study found that 10.4 percent of the workers and 4.4 percent of the others tested positive for G4 EA H1N1, and that 20.5 percent of workers between the ages of 18 and 35 tested positive for the virus, as The New York Times reported.

 U.S. withdrawal from WHO threatens to leave it 'flying blind' on flu vaccines - Twice a year, influenza experts from 10 institutions around the world meet at the World Health Organization’s Geneva headquarters to pore over mounds of data. At the end of the weeklong meetings, they make decisions that affect people around the world: namely, which variants of the flu virus should be used for vaccinations the following season. While the selections don’t always hit the mark — influenza is notoriously hard to predict — it’s the best process health officials have to keep flu vaccines up to date and try to protect people from the annual scourge. Now, with the pending withdrawal of the United States from the WHO, the future of the process — or at least America’s involvement in it — is in question. President Trump has criticized the global health agency’s handling of the Covid-19 pandemic, and other earlier health crises; he has cited that as his rationale for withdrawing from the WHO, which was established more than 60 years ago. Currently, the flu strain selection group includes three seats for institutions from the United States, which uses more flu vaccine than any other country in the world. It’s unclear how the U.S. officials might try to preserve its role in the process, or whether it could. Without access to the intelligence coming from other institutions at the table, the U.S. would be “flying blind,” said Nancy Cox, who retired from the Centers for Disease Prevention and Control in 2014 after leading the agency’s influenza division for 22 years. For one thing, new flu variants don’t typically emerge in the Americas; they often are first spotted in Asia. For another, countries that are reluctant to share viruses on a bilateral basis — because of fears others will profit from them — will often only share viruses with the WHO. The risk to the U.S. wouldn’t simply relate to season flu vaccine. Participants at the meetings share important intelligence on animal flu viruses — avian and swine influenza — that could pose pandemic threats. (Viruses that jump from animals to humans are called zoonoses.) “You won’t know what’s coming. You won’t be aware of what’s going on with respect to zoonotic flu cases,” said Cox. “It would be a really difficult position to be in at CDC as head of the influenza division and not have access to the information to be able to keep people within the U.S. informed about the global threats that exist out there.”

How COVID-19 Creates Food Waste Mountains That Threaten the Environment - Gluts of food left to rot as a consequence of coronavirus aren't just wasteful – they're also likely to damage the environment.  Mountains of produce, including eggs, milk and onions, are going to waste as the COVID-19 pandemic shutters restaurants, restricts transport, limits what workers are able to do and disrupts supply chains. And as that food decays, it releases methane, a powerful greenhouse gas. Fresh milk and eggs have been dumped, and some ripe crops reploughed back into fields, according to reports in the Wall Street Journal and the New York Times. While consumer demand for some supermarket items has risen as a result of lockdowns, it's unlikely to offset steep declines elsewhere, such in restaurants and school and workplace canteens. Not only is this a tragic waste of food at a time when many are going hungry, it is also an environmental hazard and could contribute to global warming. Landfill gas – roughly half methane and half carbon dioxide (CO2) – is a natural byproduct of the decomposition of organic material. Methane is a potent greenhouse gas, 28 to 36 times more effective than CO2 at trapping heat in the atmosphere over a 100-year period, according to the Intergovernmental Panel on Climate Change. "Many export-oriented producers produce volumes far too large for output to be absorbed in local markets, and thus organic waste levels have mounted substantially," says Robert Hamwey, Economic Affairs Officer at UN agency UNCTAD. "Because this waste is left to decay, levels of methane emissions, a greenhouse gas, from decaying produce are expected to rise sharply in the crisis and immediate post-crisis months." Since the pandemic took hold, farmers are dumping 14 million liters of milk each day because of disrupted supply routes, estimates Dairy Farmers of America. A chicken processor was forced to destroy 750,000 unhatched eggs a week, according to the New York Times, which also cited an onion farmer letting most of his harvest decompose because he couldn't distribute or store them.

 Puerto Rico Drought Leaves 140,000 Without Running Water -Puerto Rico's governor declared a state of emergency on Monday after a severe drought on the island left 140,000 people without access to running water, despite the necessary role that hand washing and hygiene plays in stopping the novel coronavirus, as The Independent reported. The island will start water rationing on July 2, as 26 percent of the island is under a severe drought and 60 percent is under a moderate drought, according to U.S. Drought Monitor, as The Independent reported. According to Governor Wanda Vasquez, that means 21 of 78 municipalities are affected by the severe drought while another 29 are affected by the moderate drought.The rationing will affect 140,000 clients of the water service, including some in the capital of San Juan, according to The Associated Press, as the Puerto Rico Electric Power Authority starts to shut off water for certain blocks of the day. That means some residents will be without water for 24 hours every other day as part of strict rationing measures. Puerto Rico's utilities company asked residents not to stockpile excessive amounts of water because it would exacerbate an already bad situation. There will also be 23 water trucks spread across the most impacted parts of the island. Officials asked that anyone seeking water from the trucks wear a mask and adhere to social distancing guidelines, according to The Associated Press. Some residents in the northeastern part of the state were already rationing water earlier in June.  Many residents rely on a system of reservoirs in Puerto Rico for water, but several have not been dredged for years, leaving sediment to collect and allowing the excess loss of water, according to The Hill. The water rationing efforts will target households connected to the Carraízo reservoir, one of 11 that Puerto Rico's government operates. It has not been dredged since the late 1990s. Five other reservoirs are under a state of observation. Officials have already taken other measures, including activating water wells and transferring more than 30,000 clients from Carraízo to another reservoir, according to the AP.

Japan evacuates 92,200 households as torrential rains pound the area - Japan is evacuating tens of thousands of residents in the southern island of Kyushu amid torrential flooding.Fifteen people are already feared dead and nine are missing, Reuters reported, citing local media outlets. Authorities have already told 92,200 households in the prefectures of Kumamoto and Kagoshima to leave amid concerns of rising flood waters and landslides. “The heavy rainfall is likely to continue until Sunday, and people in the area are required to be on maximum alert,” Prime Minister Shinzo Abe said, saying he could activate as many as 10,000 soldiers to join rescue operations.  Several homes have been cut off and one bridge was washed away after the Kuma River flooded. The floods and landslides have ravaged the region, leading Japan’s Meteorological Agency to initially post its highest level of alert, though the alarm was later downgraded. This isn't the first time heavy rains have sparked mass evacuations in the country; in July 2018, more than 2 million people were forced to leave their homes after up to 70 inches of rain led to some of Japan's worst flooding on record, according to the Washington Post.

In ‘Conservation Disaster,’ Hundreds of Botswana's Elephants Are Dying From Mysterious Cause - More than 350 elephants have died in Botswana since May, and no one knows why.Poaching has been ruled out, because no tusks have been removed from the elephants' bodies, but it is possible the animals are dying of a disease that could spread to the human population."Yes, it is a conservation disaster — but it also has the potential to be a public health crisis," National Park Rescue Director of Conservation Dr. Niall McCann told BBC News.A catastrophic die-off of elephants is happing in northern Botswana, and no one knows why. It’s vital that a team o…  Botswana's tourism ministry first said that it was investigating the deaths in mid-May, when 12 dead elephants were found over two weekends in the country's Okavango Delta, reported at the time. By the end of May, 169 elephants had died, and that number had more than doubled by mid-June, The Guardian reported. This is totally unprecedented in terms of numbers of elephants dying in a single event unrelated to drought," McCann told BBC News. But despite the scale of the deaths, the government has not yet completed testing of the animals to determine the cause, earning the criticism of conservation groups. "There is real concern regarding the delay in getting the samples to an accredited laboratory for testing in order to identify the problem — and then take measures to mitigate it," Environmental Investigation AgencyExecutive Director Mary Rice told The Guardian. "The lack of urgency is of real concern and does not reflect the actions of a responsible custodian. There have been repeated offers of help from private stakeholders to facilitate urgent testing which appear to have fallen on deaf ears … and the increasing numbers are, frankly, shocking." The government, meanwhile, attributed the delay to the coronavirus pandemic.   "The Covid-19 restrictions have not helped in the transportation of samples in the region and around the world. We're now beginning to emerge from that and that is why we are now in a position to send the samples to other laboratories." Local reports indicate that animals of all ages and sexes are dying, with some spotted wandering in circles, a sign of neurological damage. The cause is likely a poison or disease, but experts are not sure which.   McCann told BBC News he had tentatively ruled out anthrax as the cause of the most recent deaths. Cyanide poisoning used by poachers is another possibility, but scavengers are not dying after eating the carcasses, The Guardian pointed out.  "It is only elephants that are dying and nothing else," McCann told BBC News. "If it was cyanide used by poachers, you would expect to see other deaths."

 Nerve agent fear as hundreds of elephants perish mysteriously in Botswana - The mysterious death of hundreds of elephants in Botswana has left experts alarmed that there could be a dangerous neurotoxin spreading through one of Africa’s largest conservationist areas. Around 400 African elephants have died since April in the Okavango Delta, a wetland area in the northwest of the country often referred to as ‘Africa’s Last Eden.’ Powerful poaching syndicates from Zambia and South Africa regularly cross into Botswana to shoot the animals with high-calibre rifles before hacking their tusks off with axes. But these deaths are different. Pictures show dozens of rotting calves and fully grown adult elephants studding grasslands and waterholes. Their tusks, which can be worth tens of thousands of pounds, have been left untouched.  “The elephants have no visible wounds. Before they die, we’ve seen them wander around confused, emaciated and in distress. Their legs often don’t work properly or are paralysed,” Dr Niall McCann, Director of conservation for National Park Rescue, a UK-based charity.  “They often die so quickly that they fall onto their chest and front legs, like they had been shot in the brain by a hunter.”“The fact that some living elephants were seen to be losing their motor functions seems to indicate that this toxin, whatever it is, is affecting their nervous system,” Dr McCann added.  “The fact that there is a currently-unidentified nerve agent in an area so close to human habitation is very concerning, particularly at a time when the transfer of disease from animals to people is on everyone’s mind.”

Hawaii’s Invasive Predator Catastrophe --It takes a lot of effort and more than a little bit of luck for researchers like André Raine to get to the remote mountaintops of Kauai, where they're working to save endangered Hawaiian seabirds from extinction."Hawaii's bird species grew up without mammalian predators, so they're ill-adapted to the teeth and claws that arrived with human society. The cats descended from housecats, while pigs escape from agricultural sites and rats descended from stowaways on ships.  That's why the Kaua'i Endangered Seabird Recovery Project has spent the past nine years constructing fences and establishing other predator controls — work that is proving essential in giving these native birds a chance.According to a paper Raine and his colleagues published earlier this year in The Journal of Wildlife Management, introduced predators killed at least 309 endangered seabirds at six monitored breeding colonies between 2011 and 2017. That's quite a blow for each of these endangered species."Newell's shearwaters and Hawaiian petrels have suffered catastrophic declines over the last few decades," Raine said. "Any chick that's lost in the population is one that we can't afford to lose."  The researchers took on the sad task of collecting the dead and examining the wound patterns to determine which type of predator made the kill. Rats, it turned out, killed the most — more than 50% of mortalities — usually from entering the birds' rocky burrows and eating eggs and chicks. That dramatically slows recovery efforts, but the research shows that adult birds who've lost their chicks returned to the same burrows the following year to try again.Pigs kill fewer birds — about 10% of all tracked mortalities — but they were the most destructive, digging up and taking out entire nests. "It's literally like someone's taken a hand grenade and stuffed it down the burrow and blown it up," Raine said. "They just eat whatever's inside." Cats were responsible for another 35% of known deaths, and Raine says the research shows those mortalities were the worst for the long-term health of the bird species. Cats target breeding birds, taking out not just the current generation but any hope of successive generations. The seabirds are very faithful to both their burrow sites and their mates, so if a cat takes out one parent the other might not breed again for several years, if at all.

Fueled by High Temperatures and Ample Land, Locusts Swarm Italy - Swarms of locusts have stripped thousands of hectares of pasture and cropland in Sardinia, devastating farmers already struggling from the coronavirus pandemic, farming groups said. Their numbers fueled by rising temperatures, the pests have damaged nearly 15,000 hectares (37,000 acres) of grazing land in the central province of Nuoro, said Michele Arbau, of the Sardinia branch of Italian agricultural association Coldiretti. "Farmers have lost the summer pasture and partly the fodder for autumn and winter … and the very few people who grew barley had to give that up too," he told the Thomson Reuters Foundation. During the summer months, locusts are a common phenomenon on the Mediterranean island of Sardinia — known for its idyllic beaches and exclusive resorts — but this year's outbreak has been much larger than normal. Last year, the pests destroyed about 2,500 hectares in what was then described as the worst outbreak since the end of World War Two. More extreme weather driven by climate change can affect the development and spread of insect infestations, including locusts, according to Ignazio Floris, a professor of entomology at the University of Sassari in northwest Sardinia. Rising temperatures can cause longer dry periods, leading soils to become arid and unplanted, which creates ideal conditions for insects that like laying their eggs in dry, untilled soil, he said. More frequent extreme weather swings — including drought in 2017, too much rain in 2018 and both extremes last year in Sardinia — also seem to be spurring bigger locust invasions, said Coldiretti's Arbau. More idle farmland on the island also is a factor, with more farmers leaving land unplanted because they can no longer sell their harvest at a profit, Arbau said. The locust invasion adds to Italy's woes.

Climate change threat to tropical plants - Tropical plants closer to the equator are most at risk from climate change because it is expected to become too hot for many species to germinate in the next 50 years, UNSW researchers have found. Their study analyzed almost 10,000 records for more than 1,300 species from the Kew Gardens' global seed germination database. The research, published in the journal Global Ecology and Biogeography recently, was the first to look at the big picture impact of climate change on such a large number of plant species worldwide. Lead author Alex Sentinella, UNSW Ph.D. researcher, said past research had found that animal species closer to the equator would be more at risk from climate change. "The thought was that because tropical species come from a stable climate where it's always warm, they can only cope with a narrow range of temperatures—whereas species from higher latitudes can cope with a larger range of temperatures because they come from places where the weather varies widely," Mr. Sentinella said. The researchers examined seed germination data from the Millennium Seed Bank Partnership Data Warehouse, hosted by Kew Royal Botanic Gardens in London, to quantify global patterns in germination temperature. They analyzed 9,737 records for 1,312 plant species from every continent except Antarctica and excluded agricultural crops. Mr. Sentinella said they chose seed data because it was widely available and relevant to the ability of a species to cope with different temperatures. The study discovered tropical plants do not have narrower temperature tolerances but were more at risk from global warming, because it would bring them close to their maximum seed germination temperatures.  "The figures are quite shocking because by 2070, more than 20 percent of tropical plant species, we predict, will face temperatures above their upper limit, which means they won't germinate, and so can't survive."

Rising water temperatures could endanger the mating of many fish species -  Because fish that are ready to mate and their young are especially sensitive to changes in temperature, in the future up to 60 percent of all species may be forced to leave their traditional spawning areasIn a new meta-study, experts from the Alfred Wegener Institute, Helmholtz Centre for Polar and Marine Research (AWI) have published ground-breaking findings on the effects of climate change for fish stock around the globe. As they report, the risks for fish are much higher than previously assumed, especially given the fact that in certain developmental stages they are especially sensitive to rising water temperatures. One critical bottleneck in the lifecycle of fish is their low tolerance for heat during mating. In other words, the water temperature in their spawning areas determines to a great extent how successfully they reproduce, making fish particularly vulnerable to the impacts of climate change - not only in the ocean, but also in lakes, ponds and rivers. According to the researchers' analyses, if left unchecked, climate change and rising water temperatures will negatively affect the reproduction of up to 60 percent of all fish species. Their study was released today in the latest issue of the journal Science.

Ocean Warming Dooms Most Fish, Study Says - The oceans could look much emptier by 2100, according to a new study that found that most fish species would not be able to survive in their current habitat if average global temperatures rise 4.5 degrees Celsius by the end of the century, as The Guardian reported.The researchers of the new paper said that 60 percent of fish species face a grave threat from global heating if temperatures approach that worst-case scenario level. The species under threat include many common fish found in grocery stores, including staples like Atlantic cod, Alaska pollock and sockeye salmon, and sport fishing favorites like swordfish, barracuda and brown trout, as CNN reported.The new study, published in the journal Science, looked at how nearly 700 fresh and saltwater fish species respond to warming ocean temperatures. The problem for most fish is that as ocean temperatures rise, the oxygen level goes down, which makes it extremely challenging for embryos to survive. “A 1.5C increase is already a challenge to some, and if we let global warming persist, it can get much worse," said Hans-Otto Pörtner, a co-author on the paper and a climatologist at the Alfred Wegener Institute, Helmholtz Centre for Polar and Marine Research in Germany, as The Guardian reported. That 1.5 degrees Celsius threshold would result in 10 percent of marine species suffering over the next 80 years, including the aforementioned grocery staples.However, even a 10 percent decline in fish species has a large ripple effect on ecosystems as one species being pushed out effects the food supply and the habits of many other species that have evolved to be interdependent.Since we are already 1 degree warmer than the pre-industrial level and emissions are starting to rise around the world as countries reopen, it seems highly unlikely that the world will not blow past that lowest benchmark. In fact, we are currently on pace for a 3 degree increase over the pre-industrial level, as The Guardian noted. "More than half of the species potentially at risk is quite astonishing, so we really emphasize that it's important to take action and follow the political commitments to reduce climate change and protect marine habitats," said Dr. Flemming Dahlke, a marine biologist at Germany's Alfred Wegener Institute and one of the authors of the study, as CNN reported.

Dead fish are popping up all along the Hudson River - Dead fish are turning up in large numbers all along the Hudson River from Manhattan to Yonkers, according to environmental organization Riverkeeper. The group said finned fatalities are being reported from New York Harbor all the way north to Haverstraw Bay — and suffocation caused by climate change is the likely cause of death. The unrelenting hot summer temperatures can overheat water, which decreases available oxygen for aquatic life to the point that fish can suffocate, Riverkeeper explained. “The widespread deaths of Atlantic menhaden, and possibly other species, are most likely the result of prolonged heat and lack of rain, combined with other factors, which reduce levels of dissolved oxygen that the fish need to survive,” the group said. Riverkeeper added that the general fragility of local waterways is also contributing to the phenomenon. Meanwhile, the gradual loss of oyster beds and reefs in local waterways has led to an overgrowth of algae. “The destruction and loss of these beds killed off these filter feeders,” Riverkeeper said. “So the river starts from a compromised position, with over-nutrification from sewage and fertilizer. “Later this summer, when we get a series of rainstorms or cloudy days, we’ll see lower water temperatures and less algae growth, and we’re likely to see a reduction of fish mortality as oxygen returns to adequate levels.” “But we should consider this yet another warning that we need to restore the baseline health of the Hudson and New York Harbor in the face of climate change and ever-increasing global water temperatures,” the group added.

Koalas Face Extinction in Next 30 Years Without Urgent Intervention, Report Warns - Koala populations across parts of Australia are on track to become extinct before 2050 unless "urgent government intervention" occurs, warns a year-long inquiry into Australia's "most loved animal." The report published by the Parliament of New South Wales (NSW) paints a "stark and depressing snapshot" of koalas in Australia's southeastern state. "Even before the devastating 2019-2020 bushfires, it was clear that the koala in NSW, already a threatened species, was in significant trouble," says the report, adding that previous population estimates counting 36,000 individuals were "outdated and unreliable." "Then came the fires. With at least 5,000 koalas lost in the fires, potentially many more, it was deeply distressing but extremely important for committee members to agree to the finding that koalas will become extinct in NSW before 2050 without urgent government intervention." At least 5,000 animals were lost in the 2019 bushfires responsible for killing more than 1 billion animals. Conservation groups warned of the possible extinction in March after projections that the wildfires resulted in the loss of 80 percent of habitat, forcing the charismatic marsupials into "functional extinction." Endemic only to the eucalyptus forests in the southeastern and eastern parts of the continent, koalas rely on the trees for both habitat and food, according to National Geographic. They are threatened by the destruction of habitat through the clearing and fragmentation of their unique habitat, which is further exacerbated byclimate change and ongoing drought conditions that have plagued the region for years. Philip Spark, a wildlife ecologist, warned in the report that successive extreme events in the past had reduced one koala population by as much as half and pushed another to local extinction. "With the trees dying and the streams drying there is a recipe for disaster. Koalas are really on the brink of not surviving," said Spark. "A crisis can happen with very little warning." Citing a report published by the Intergovernmental Panel on Climate Change, Sparks added that by 2050, one in 100-year events are expected to occur every year with 50-degree Celsius heatwaves in the next 20 years. The committee further found that climate change has a severe impact on koalas and not only affects the quality of their food and habitat, but also compounds the "severity and threats of other impacts, such as drought and bushfires."

Arizona reels as three of the biggest wildfires in its history ravage state -- For residents of Tucson in southern Arizona, the Santa Catalina Mountains in the Coronado national forest are known as a hub for hiking, mountain biking and other outdoor recreation.  But on 5 June lightning ignited a wildfire that has grown to engulf over 118,000 acres. The fires are still only 58% contained. Called the Bighorn fire, it is the eighth-biggest in state history, and it has transformed the Catalinas into a hub for the study of the impacts of climate change. Nasa satellite photos show largescar marks left by the fire.  “At night you can see basically the outline of the fire on the mountain,” said Courtney Slanaker, the executive director for the American Red Cross Southern Arizona, “and then during the daytime you’re seeing that heavy smoke as it moves through different fuel sources on the mountain.”And yet, Bighorn is just one of three fires that sit in the top 10 biggest wildfires in Arizona history.The Bush fire in the Tonto national forest, about 30 miles from Phoenix, now covers 193,000 acres and 98% is contained. It is the fifth-biggest in state history. Meanwhile, the Mangum fire burning in the Kaibab national forest now covers over 71,000 acres and 67% contained. The trio of fires are bigger than Washington DC, San Francisco, Baltimore, Chicago, Miami, Minneapolis and Manhattan combined. Despite the fires’ enormous size, only one home has suffered serious structural damage. Beyond the three major fires, eight others in Arizona are either still burning or were recently contained. One of them, the Blue River fire, is over 30,000 acres and 85% contained, burning on the San Carlos Apache Indian Reservation. Another, the Wood Springs 2 fire, now covers nearly 9,000 acres of the Navajo Nation and is only 5% contained. Both of those fires, like the Bighorn fire, ignited via lightning strikes according to the National Wildfire Coordinating Group. The wildfires come as tribal nations and Arizona face an uptick in Covid-19 cases. The Navajo Nation has the highest per-capita infection rate in the US, while Arizona currently faces an infection rate of over 28% of those tested.

Siberian Forest Fires Increase Fivefold in Week Since Record High Temperature - The number of fires in the vast north Asian region of Siberia increased fivefold this week, according to the Russian forest fire aerial protection service, astemperatures in the Arctic continued higher than normal in the latest sign of the ongoing climate crisis. The news of the increase comes a week after the small Siberian town of Verkhoyansk reported a high temperature of 100.4° F on June 20, a reading that, if confirmed, would mark the hottest day ever recorded in the region.  "While fires are common at this time of year, record temperatures and strong winds are making the situation particularly worrying," the European Union's Earth Observation Programme, which is monitoring the situation, said in a statement. As the Associated Press reported:According to figures reported Saturday by Avialesookhrana, Russia's agency for aerial forest fire management, 1.15 million hectares (2.85 million acres) were burning in Siberia in areas that cannot be reached by firefighters. The worst-hit area is the Sakha Republic, where Verkhoyansk is located, with 929,000 hectares (2.295 million acres) burning.The Sakha Republic's fire service reported 127 natural fires in the Russian federal sector.The fires and heat are due to the climate crisis, Weather Channel meteorologist Carl Parker told Newsweek."What climate change is doing is moving the distribution of weather events, such that historically low-frequency, extreme events occur more frequently," said Parker. "Had the climate not changed due to man-made greenhouse gases, the heat we've seen in parts of Siberia would have been a 100,000-year event."Parker warned that the fires are part of a dangerous feedback loop in the northern region."What's scary about the warming in Siberia is that there are huge quantities of carbon in permafrost, which can be unleashed during periods like this, particularly as fires develop in the region," said Parker.

 100.4 degree Arctic temperature record confirmed as study suggests Earth is warmest in at least 12,000 years - Less than two weeks ago, the small Siberian town of Verkhoyansk soared to 100.4 degrees Fahrenheit, appearing to break an all-time record for the Arctic and alarming meteorologists worldwide. Now that temperature record has been verified by Russia's state weather authority. The confirmation came the same day a comprehensive new study was released suggesting that present-day global temperatures are the warmest they have been in at least 12,000 years, and possibly far longer. The study used a variety of geological clues and statistical analysis methods to reconstruct ancient temperature estimates. In a press conference Tuesday, the head of science at Russia's Hydrometeorological Centre confirmed that the town of Verkhoyansk did indeed reach 100.4° F on June 20th. The official confirmation was requested by the World Meteorological Organization.  Ten days after that record was set, the heat wave still persists. On Tuesday, a town in the Sakha Republic, 450 miles north-northwest of Verkhoyansk, and also 450 miles north of the Arctic Circle steps from the Arctic Ocean's Laptev Sea, hit an astonishing 93 degrees Fahrenheit. That's 40 to 45 degrees above normal. The record heat in parts of Siberia during the month of May was so remarkable that it reached five standard deviations from normal. In other words, if hypothetically you were able to live in that area for 100,000 years, statistically speaking you should only experience such an extreme period of temperatures one time. The extended Siberian heat wave is due to an usually persistent high pressure system, which more or less has remained stuck over Russia since December. And while it's not uncommon for patterns to set up shop for extended periods of time due to natural cycles, this tenacity is extraordinary, to say the least.

 South pole warming three times faster than rest of the world - Climate scientists long thought Antarctica’s interior may not be very sensitive to warming, but our research, published this week, shows a dramatic change.Over the past 30 years, the south pole has been one of the fastest-changing places on Earth, warming more than three times more rapidly than the rest of the world. My colleagues and I argue these warming trends are unlikely the result of natural climate variability alone. The effects of human-made climate change appear to have worked in tandem with the significant influence natural variability in the tropics has on Antarctica’s climate. Together they make the south pole warming one of the strongest warming trends on Earth.The south pole lies within the coldest region on Earth: the Antarctic plateau. Average temperatures range from -60℃ during winter to just -20℃ during summer. Antarctica’s climate generally has a huge range in temperature over the course of a year, with strong regional contrasts. Most of West Antarctica and the Antarctic Peninsula were warming during the late 20th century. But the south pole – in the remote and high-altitude continental interior – cooled until the 1980s. Scientists have been tracking temperature at the Amundsen-Scott south pole Station, Earth’s southernmost weather observatory, since 1957. It is one of the longest-running complete temperature records on the Antarctic continent. Our analysis of weather station data from the south pole shows it has warmed by 1.8℃ between 1989 and 2018, changing more rapidly since the start of the 2000s. Over the same period, the warming in West Antarctica suddenly stopped and the Antarctic Peninsula began cooling. One of the reasons for the south pole warming was stronger low-pressure systems and stormier weather east of the Antarctic Peninsula in the Weddell Sea. With clockwise flow around the low-pressure systems, this has been transporting warm, moist air on to the Antarctic plateau. Our study also shows the ocean in the western tropical Pacific started warming rapidly at the same time as the south pole. We found nearly 20% of the year-to-year temperature variations at the south pole were linked to ocean temperatures in the tropical Pacific, and several of the warmest years at the south pole in the past two decades happened when the western tropical Pacific ocean was also unusually warm.

Some New Climate Models Are Projecting Extreme Warming. Are They Correct? -For the past year, some of the most up-to-date computer models from the world’s top climate modeling groups have been “running hot” – projecting that global warming may be even more extreme than earlier thought. Data from some of the model runs has been confounding scientists because it challenges decades of consistent projections.“It is concerning, as it increases the risk of more severe climate change impacts,” explains Dr. Andrew Gettelman, a cloud microphysics scientist from the National Center for Atmospheric Research, in Boulder, Colorado.As a result, there’s been a real urgency to answer this important question in climate science: Are there processes in some new models that need correcting, or is this enhanced warming a real threat? After months of contemplation and study after study, the picture is becoming much more clear, and providing something of a breather. Along with those studies, an unprecedented international research mission, led by NOAA and named ATOMIC, aims to provide climate science with the most sophisticated insights yet into why some models point to more warming.  Climate models are complicated computer programs composed of millions of lines of code that calculate the physical properties and interactions between the main climate forces like the atmosphere, oceans, and solar input. Every few years there is a new comprehensive international evaluation called the Coupled Model Intercomparison Project (CMIP). In the sixth such effort, known as CMIP6 and now under way, experts are reviewing about 100 models. Over the past year, the CMIP6 collection of models being reviewed threw researchers an unexpected curveball: a significant number of the climate model runs showed substantially more global warming than previous model versions had projected. If accurate, the international climate goals would be nearly impossible to achieve, and there would be significantly more extreme impacts worldwide.

Extraordinary ‘megaflash’ lightning strikes cover several hundred kilometres, smashing records - Closing the windows probably wouldn’t have made much difference to anyone stuck in the middle of the flash that developed continuously over northern Argentina on 4 March 2019, lasting a whopping 16.73 seconds. And the flash that stretched more than 700 kilometres (400 miles) across southern Brazil on 31 October last year, was equivalent to the distance between Boston and Washington DC in the United States, or between London, England, and Basel, Switzerland.The world’s greatest extent for a single lightning covered a horizontal distance of over 700 km (440) across parts of southern Brazil on 31 October 2018, by WMOThe previous megaflash distance record was 321 km (199.5 miles) on 20 June 2007, across the US state of Oklahoma, and the previous continuous duration record, was a puny-by-comparison 7.74 seconds, reached on 30 August 2012 in southern France.The new record-breaking strikes, captured by the American Geophysical Union ahead of International Lightning Safety Day on 28 June, were recorded by equipment carried on the Geostationary Operational Environmental Satellites, and their orbiting counterparts from Europe and China.The records were described by Professor Randall Cerveny, chief rapporteur of Weather and Climate Extremes for WMO, as “extraordinary”: “Environmental extremes are living measurements of what nature is capable of, as well as scientific progress in being able to make such assessments”, he added.  “It is likely that even greater extremes still exist, and that we will be able to observe them as lightning detection technology improves.”

Common fireworks release toxic metals into the air - Some of America's favorite Independence Day fireworks emit lead, copper, and other toxins, a new study suggests. These metals, which are used to give fireworks their vibrant color, also damage human cells and animal lungs. Led by researchers at NYU Grossman School of Medicine, the study showed harmful levels of lead in two of 12 types of commercially-available fireworks sampled. Experiments using rodents and human tissue also showed that lung exposure to particle emissions from five types of firework significantly increased oxidation, a chemical process in the body that can damage or even kill cells if left unchecked. "While many are careful to protect themselves from injury from explosions, our results suggest that inhaling firework smoke may cause longer-term damage, a risk that has been largely ignored," says study senior author Terry Gordon, PhD, a professor in the Department of Environmental Medicine at NYU Langone Health.  "Although people are only exposed to these substances for a short time each year, they are much more toxic than the pollutants we breathe every day," says Gordon.

World’s Pile of Electronic Waste Grows Ever Higher: Study (AP) — The world’s mountain of discarded flat-screen TVs, cellphones and other electronic goods grew to a record high last year, according to an annual report released Thursday. The U.N.-backed study estimated the amount of e-waste that piled up globally in 2019 at 53.6 million metric tonnes (59.1 million tons) - almost 2 million metric tons more than the previous year. The authors of the study calculated the combined weight of all dumped devices with a battery or a plug last year was the equivalent of 350 cruise ships the size of the Queen Mary 2. Among all the discarded plastic and silicon were large amounts of copper, gold and other precious metals — used for example to conduct electricity on circuit boards. While about a sixth of it was recycled, the remainder of those valuable components — worth about $57 billion — weren’t reclaimed, the study found. Discarded electronic equipment also poses a health and environmental hazard, as it contains substances such as mercury that can damage the nervous system. The authors of the study, which is produced by the U.N. University, the International Solid Waste Association and others, predicted that global e-waste could grow to 74 million metric tons by 2030.

Global e-waste surging: Up 21% in 5 years - A record 53.6 million tons (Mt) of e-waste was produced globally in 2019, the weight of 350 cruise ships the size of the Queen Mary 2; $57 billion in gold and other components discarded -- mostly dumped or burned United Nations University / ITU / UNITAR A record 53.6 million metric tonnes (Mt) of electronic waste was generated worldwide in 2019, up 21 per cent in just five years, according to the UN's Global E-waste Monitor 2020. The new report also predicts global e-waste -- discarded products with a battery or plug -- will reach 74 Mt by 2030, almost a doubling of e-waste in just 16 years. This makes e-waste the world's fastest-growing domestic waste stream, fueled mainly by higher consumption rates of electric and electronic equipment, short life cycles, and few options for repair. Only 17.4 per cent of 2019's e-waste was collected and recycled. This means that gold, silver, copper, platinum and other high-value, recoverable materials conservatively valued at US $57 billion -- a sum greater than the Gross Domestic Product of most countries - were mostly dumped or burned rather than being collected for treatment and reuse. For perspective, last year's e-waste weighed substantially more than all the adults in Europe, or as much as 350 cruise ships the size of the Queen Mary 2, enough to form a line 125 km long. E-waste is a health and environmental hazard, containing toxic additives or hazardous substances such as mercury, which damages the human brain and / or coordination system.

Microplastic in terrestrial ecosystems - Concern about microplastics (plastic particles <5 mm) polluting different environmental compartments is mounting. Research has recently begun to embrace terrestrial systems, having initially focused at least a decade earlier on marine and aquatic ecosystems (1–3). The early research agenda on microplastics in both aquatic and terrestrial systems was mainly ecotoxicological. It included laboratory tests on individual organisms, often well-established test species (4), and also targeted selected soil properties and processes. Such research is necessary to establish baseline mechanisms, which is important because microplastics differ from other pollutants. Many of their effects appear to be mediated by physical parameters, such as particle shape and size, rather than overt chemically mediated toxicity. Moreover, their effects are mostly sublethal or even nominally positive. Although the study of other global change factors has tended to focus at the level of the ecosystem, research on microplastic is only now on the verge of this wider view. Microplastics are mostly composed of carbon, among other elements. Microplastic addition to ecosystems thus represents a source of carbon independent of photosynthesis and net primary production. This polymer carbon likely has a slow turnover, because the material is mostly inert; however, the behavior and residence time of microplastics in soil are currently unknown. We also do not know the input rate of microplastic-carbon into ecosystems itself, because research hitherto has largely focused on quantifying particle numbers and types, rather than on the microplastic-derived carbon itself. Originally, most of this carbon is of fossil origin, rather than having recently been fixed from the atmosphere. Because of the resistance of microplastic to decomposition, it would be expected to accumulate in soils, where it needs to be accounted for in assessments of soil carbon storage (8), a major ecosystem function.

NJ Senate Bill Helps Environmental-Justice Communities Block Further Pollution   Measure, which won early support from governor, allows overburdened communities to consider cumulative effect of pollution when another ‘dirty’ project is proposed.   For the first time, New Jersey communities could be given a powerful new tool to block projects that would add to their pollution burden under a bill approved by the Senate Monday.The legislation (S-232), which cleared the Senate in a 22-14-4 vote, has long been a priority for advocates who argue the state ignores the cumulative impacts of locating a new power plant or manufacturing facility in communities where residents already suffer the effects of pollution from incinerators, hazardous waste sites and sewage-treatment plants.Its approval, after a decade of lobbying by activists, comes at a moment of reckoning for racial and environmental justice in the nation. To some, the bill is a model for the rest of the country — the most protective environmental-justice statute for communities oversaturated with toxic facilities.  The legislation would allow the state Department of Environmental Protection to consider the cumulative impacts in a community when a new permit is sought for a polluting project in “overburdened communities.’’ Previously, the DEP could only consider impacts from the project seeking a permit.

 House Democrats Unveil Bold Climate Plan Linked to Racial Justice -  House Democrats are releasing an aggressive new plan to fight the climate crisis on Tuesday. The 538-page plan includes various goals to dramatically reduce the nation's emissions. It sets a target for every new car sold by 2035 to emit no greenhouse gases, to eliminate overall emissions from the power sector by 2040, and to all but eliminate the country's total emissions by 2050, according to The New York Times. Solving the Climate Crisis: The Congressional Action Plan for a Clean Energy Economy and a Healthy, Resilient, and Just America is the first major piece of legislation from the House Select Committee on the Climate Crisis, established last year as the Green New Deal was garnering attention, and would put the country on a path to meeting the goals of the Paris agreement, as The Hill reported. "While local communities and states and businesses take climate action, what's been missing is the federal government," said Rep. Kathy Castor, (D-FL), who chairs the House Select Committee on the Climate Crisis, in an interview with the Tampa Bay Times. Prior to creating its bold plan to set the course for a zero emissions future, the committee heard testimony from researchers, local officials and a bevy of environmental activists like Greta Thunberg, according to the Tampa Bay Times. "Turning this plan into reality will build a safer, healthier, and fairer America, restore our global climate leadership, enhance our national security, and provide a livable climate for today's youth and future generations," the report says.  The ambitious plan, which faces an dubious future in a Republican-controlled Senate, requires companies to pay for emitting excessive amounts of carbon into the atmosphere. While that cost will pass down to the consumer, it may have the net effect of reducing consumption. It also has provisions that give money back to low- and moderate-income households, according to The New York Times.  Since racial minority communities are disproportionately affected by pollution and extreme weather from the climate crisis, the report ties environmental justice to racial justice, citing the police killing of George Floyd in its opening paragraph. As The New York Times reported, the report argues that the government should prioritize racial minority communities for new spending on energy and infrastructure.  "We have to focus on environmental-justice communities," said Castor, according to The New York Times. "There is an awakening across the country to systemic racism, and this is a report that at its center, at its core, focuses on those communities."

Democrats' blueprint for fighting climate change sees FERC playing key role | S&P Global Market Intelligence - The Federal Energy Regulatory Commission would be given sweeping new authorities to help address climate change under the recommendations of a plan the Democratic majority on the U.S. House Select Committee on the Climate Crisis released June 30. House Democrats touted their proposal as a means to save the planet and build a clean energy economy providing "good-paying jobs" as the nation battles through an economic recession. In a departure from a 622-page bill passed in January that would have authorized the U.S. Environmental Protection Agency to require state climate plans, the House Democrats' plan calls for a major rewrite of the Federal Power Act, or FPA, to give FERC a greatly expanded role in efforts to achieve a 100% carbon-free power grid. Among hundreds of specific policy recommendations, the plan said Congress should direct FERC, which has exclusive authority over wholesale electricity markets and interstate power transmission, to develop "a comprehensive, long-range electric infrastructure strategy" in line with a 100% net-zero-by-2040 goal that also supports any state policies that are more stringent. Noting that a previous effort to enable the U.S. Department of Energy to relieve congested transmission corridors ran into legal trouble, the plan said the FPA should be amended to direct FERC, rather than the DOE, to designate National Interest Electric Transmission Corridors. It also said FERC should be empowered to exercise backstop siting authority within those corridors when one or more states have approved a proposed transmission line but one or more states have denied the project or withheld approval for more than two years. The recommendation is significant because permitting battles have inhibited the build-out of the nation's high-voltage transmission infrastructure, an essential step in accommodating a high level of renewable energy penetration. Recognizing the nation's vast offshore wind potential, the plan also would call on FERC to develop a plan for national offshore wind transmission, break down barriers to the interconnection of offshore generating facilities and develop cost allocation methodologies for those projects. The Democrats' plan also would direct FERC to find under an amended FPA that wholesale electricity rates are unjust and unreasonable if they do not incorporate the external costs associated with planet-warming greenhouse gas emissions. However, any amendment to the FPA should not preempt state clean energy programs or stricter state-level standards, the plan added.

Climate change: What AOC and House Democrats actually want to do about it – Vox - In 2007, shortly after Democrats took back the House of Representatives in the 2006 midterm elections, House Speaker Nancy Pelosi created the House Select Committee on Energy Independence and Global Warming, meant to gather expert testimony and develop policy plans to address climate change. Until Republicans killed it in 2011, the select committee amassed an enormous body of knowledge, which it contributed to the 2007 energy bill, the 2009 Obama stimulus bill, and the ill-fated Waxman-Markey climate bill (which died in the Senate).In 2018, just before Democrats re-took the House, Pelosi proposed reconstituting the committee. In the wake of the election, climate change activists, led by newly elected Representative Alexandria Ocasio-Cortez, demanded that the new committee have teeth — that it be charged with developing a Green New Deal. The original sit-in at Pelosi’s office, where AOC drew scads of media attention by appearing after having been elected but before being sworn in, was in part about demanding a more robust committee. Activists eventually got dozens of lawmakers to sign on to the effort.In the end, though, Pelosi gave the new select committee a purely advisory role, with neither subpoena power nor a specific legislative mandate. (I recount the fight in more detail in my Green New Deal explainer.)

For communities and climate, federal government should leave environmental protections alone - Opinion - The Columbus Dispatch - Established in 1969 by a near-unanimous vote of Congress and signed into law by President Richard M. Nixon on Jan. 1, 1970, the National Environmental Policy Act revolutionized the decision processes of federal agencies by requiring them to closely examine the environmental impacts of major government projects. For more than 50 years, NEPA has empowered citizens by ensuring the public has input into federal agency decisions that could affect the environment, the climate, and our communities. NEPA ensures transparency in government decision-making by guaranteeing citizens the right to information about the environmental consequences of proposed projects, to comment on those projects and to receive written responses to their concerns. The nation’s first major environmental statute is, however, under attack. President Donald Trump has already dismantled more than 60 environmental rules and is in the process of rolling back more than 30 more — including those that govern air and water pollution, climate change, endangered species and wildlife, toxic chemicals and our public lands.Gutting NEPA is the Trump administration’s latest attempt at silencing our voices and denying much-needed protections for our environment.One of the many attacks is a proposed rule that would exempt many U.S. Forest Service projects from public input and NEPA review. Proposals that would clear cut thousands of acres of national forest would no longer require a NEPA review. If finalized, this rule could result in the serious degradation of Ohio’s own Wayne National Forest. And this important forest recently benefited from strong NEPA protections. In March 2020 the Ohio Environmental Council and our legal partners secured a significant federal court ruling which halted the Trump administration’s attempt to open some 40,000 acres of the Wayne to oil and gas development. The federal government failed to consider numerous impacts to air, water, wildlife species and the Wayne; a failure that was in violation of NEPA. Agencies involved had declined to acknowledge, let alone consider, miles of forest-disturbing pipelines this project would entail. Unfortunately, this story is not rare. Under President Donald Trump, it is commonplace.

California set to ban all heavy diesel trucks and vans by 2045 - The days of diesel delivery trucks and vans in California are numbered. On Thursday, the state's Air Resources Board adopted a new rule that will phase out these most polluting of vehicles from the state over the next quarter-century. Beginning in 2024, OEMs that want to sell medium- and heavy-duty trucks in the state will have to ensure that some of those trucks are zero emissions vehicles (ZEVs). Over time, the percentage of those ZEV trucks has to increase, so that by 2045, any new truck sold in the state will be emission-free. Currently, CARB estimates that 2 million diesel trucks and vans are the cause of 70 percent of smog-causing pollution in the state.  The new rule excludes light trucks (8,500lbs/3,855kg and under), so the new Ford F-150doesn't count. But it does apply to pretty much anything bigger than that—class 2b (like a Ford F-250 for example) all the way through the biggest class 8 trucks and tractors. The mandate starts gently: in 2024, only 3 percent of class 2b and class 3 trucks, 7 percent of class 4 through 8 trucks, and 3 percent of class 7 and 8 tractors have to be emissions free. And in fact, for pickup trucks—ie trucks that came from the factory with a load bed rather than some other configuration—the class 2b-class 3 rule only kicks in during 2027. But just 10 years from now, half of all new trucks and vans sold in California in classes 4 through 8—which includes everything from the package delivery van to the biggest garbage trucks—will have to be ZEVs. And by 2035, CARB says that 55 percent of all class 2b-3 trucks, 75 percent of all class 4 through 8 trucks and vans, and 40 percent of all class 7 and 8 trucks and tractors sold in the state have to be ZEVs.

Report: Renewable energy jobs vanish - 131,660 Midwest clean energy workers have filed for unemployment. Job losses damper fast-growing sector that employed 744,040 in the region at end of 2019. Before COVID-19, clean energy jobs were growing almost 4 times faster than overall economy. Clean energy jobs that were growing four times faster than other sectors have vanished because of the COVID-19 pandemic, according to a report by Environmental Entrepreneurs. Since March, when positive COVID-19 cases started to mount in Michigan and the nation, 131,660 Midwest clean energy workers have filed for unemployment, including 4,932 new claims filed in May, said E2's Clean Jobs Midwest 2020 report. Michigan, Illinois and Ohio have been hit hardest by the clean energy job losses, said the report, which noted Michigan had been enjoying a 3 percent annual growth in renewable energy and clean transportation jobs. Michigan companies were projecting a 4 percent growth rate for 2020 before COVID-19 hit. Nationwide, more than 620,000 clean energy workers have filed for unemployment.Congress is considering new stimulus measures for clean energy and other sectors of our economy, but the clean energy industry is shedding jobs at alarming rates because of COVID-19 and the economic downturn, according to a separate analysis by Environmental Entrepreneurs, a nonpartisan group of business leaders, investors and professionals."History has shown us that clean energy investments and stimulus have a track record of creating jobs and building our economy," said Micaela Preskill, E2's midwest advocate, in a statement. "As we look to economic recovery, we urge lawmakers to consider the size, scope and potential for growth of the clean energy industry. Hundreds of thousands of electricians, construction workers, technicians and factory workers work in clean energy in every corner of our region and the industry has grown year after year."Environmental Entrepreneurs is a national, nonpartisan group of business leaders, investors, and professionals from every sector of the economy who advocate for smart policies that are good for the economy and good for the environment.

More utilities bypassing natural gas bridge and going straight to renewables – Utilities that are transitioning away from coal are starting to view the creation of a natural gas “bridge” to renewable energy as an unnecessary step. Last week utilities in Arizona, Colorado and Florida announced plans to close one or more of their coal plants and build renewables without adding any new gas-fired generation. Separately, staff at the New Mexico Public Regulation Commission recommended a similar gas-free transition when assessing the future capacity needs of the Public Service Company of New Mexico (PNM). Renewable energy economics have been challenging the competitiveness of coal for a while now, but these latest moves indicate a greater confidence that the switch from coal to renewables can be done cost effectively and reliably without the construction of new gas fired generation as an interim step. “Up until recently, the easy option for utilities would have been to propose using gas to replace coal. But not any longer. Rising concerns about climate change and continuing reductions in wind, solar and battery storage costs coupled with improved performance have altered the playing field,” Institute for Energy Economics and Financial Analysis (IEEFA) said. Tucson Electric Power (TEP) and Colorado Springs Utilities (CSU) both outlined their plans to skip the gas bridge as they transition away from coal in their resource plans. Meanwhile, Florida Power & Light (FPL) and Jacksonville’s municipal utility, JEA, entered into an agreement under which they will rely on existing natural gas and new solar generation to retire their jointly-owned facility, Unit 4 at Plant Scherer, the largest coal-fired plant in the US. According to the IEEFA, to replace JEA’s share of the unit’s output, the two utilities signed a long-term, fixed-price power purchase agreement under which FPL will sell electricity to JEA from one of its exiting gas-fired generation units. Under the agreement, JEA can opt to switch to solar power at the 10-year mark. TEP’s proposal calls for closing all of its coal-fired generation by 2031 and replacing this capacity with 2,457 MW of new wind and solar generation and 1,400 MW of battery storage. Similarly, CSU’s plan also calls for replacing coal capacity with wind, solar and storage generation. It plans to add 500 MW of new wind generation, 150 MW of new solar and 400 MW of battery capacity. To enable the early retirement of its 208 MW Martin Drake Power Plant in 2023, CSU will be installing temporary natural gas generators at the site “to ensure system reliability.” CSU said that it will remove these generators as its new renewable and storage projects are completed.

How do you save clean energy? This company plans to pump it underground  -New York. California. Hawaii. Colorado. Maine. All of these states and a few others want to get their electric grids running mostly if not entirely on renewable energy in the next few decades. As they ramp up wind and solar farm projects, they’re also looking for ways to store surplus energy to use when the wind isn’t blowing and the sun isn’t shining. Start-ups focused on energy storage are scrambling for the cash and opportunities to demonstrate that their system will hold more than a few hours worth of charge. Last week, Quidnet, a Houston, Texas-based company, announced that it lined up a contract with the New York State Energy and Research Development Authority to construct a pilot project for its “Geomechanical Pumped Storage” technology. Quidnet’s system is a new take on pumped-hydro storage, which takes excess energy from the grid during periods of low electricity demand and uses it to pump water up a hill from a lower reservoir to an upper reservoir. Later, when energy is needed, the water is released back down to spin a turbine and generate electricity. Pumped-hydro accounts for 95 percent of the existing energy storage used by utilities in the U.S., but most of these systems were built in the 1970s and 1980s. That’s because it’s expensive and politically difficult to set aside enough land in the mountains to build new pumped-hydropower reservoirs. Joe Zhao, the CEO of Quidnet, said the company’s technology depends on the same supply chains and expertise used by existing pumped-hydro systems, but gets around those stickier land-use problems by pushing the water underground. To “charge” the battery, the system draws excess energy from the grid to suck water from a holding pond into an underground well, where it’s stored under pressure in the rock. When the energy is needed, the water is released and rushes back to the surface, spinning a turbine similar to those deployed in traditional pumped-hydro systems. The pilot project in New York aims to store 10 hours worth of energy.

Indiana's slowed energy transition could soon be picking up momentum | S&P Global Platts — The Indiana power market, which is guided by a renewable portfolio standard of 10% by 2023, has total generation of 26,642 MW with approximately 2,700 MW of installed wind and solar capacity, which means the RPS has been reached. Installations of new wind and solar, however, have slowed considerably in the last two years, and the share of the state's electricity consumed that comes from renewables is approximately 6.5%, according to the Department of Energy's Energy Information Administration. What Indiana, like so many other Midwestern states, relies upon are the large number of coal and gas-fired generators that, as of April, had total in-state capacity of 23,840 MW, according to data from the EIA. Sitting on large coal deposits, the state's power generating companies have some of the country's largest coal-fired facilities. Unlike some of its neighboring states, Indiana has never built nuclear generation. The state's top generators, including Duke Energy Indiana, the Northern Indiana Public Service Company, Indiana Power & Light and Vectren, each own significant amounts of coal-fired capacity, but are sitting on plans to install significant amounts of new solar capacity. Duke Energy Indiana, which ran nearly 90% coal generation in Indiana in 2018, owns the Gibson County, Indiana, five-unit coal-fired facility. The plant has 3,145 MW of capacity and is among the largest coal-fired facilities in the country. According to the company's 2018-2037 integrated resource plan, the Gibson plant's 622-MW Unit 4 is due to be retired in 2026, while two other units aren't due to retire until 2034 and the remaining two not until 2038. The company said, however, that it "continues" with its transition to "a cleaner energy future." It said that since 2005 in Indiana, it has decreased sulfur dioxide emissions by 95%, nitrogen oxide emissions by 63% and carbon emissions by 21% Duke Energy Indiana's IRP says that while coal-fired generation is "gradually retired, we expect to add 2,480 MW of cleaner burning natural gas, 700 MW of wind energy, and 1,650 MW of solar power all by the year 2037." "We're creating a more diverse portfolio with less carbon and less risk than other alternatives that may rely more on purchased power from the market -- all while being cost competitive," it said. A spokesperson confirmed that Duke Energy Indiana falls under its parent company's 2050 net-zero CO2 emissions goal.

Column: Coal prices slammed on slumping India imports, China fears - Russell - (Reuters) - Seaborne coal prices in Asia have plunged to the lowest in more than a decade as shipments to the region’s top importers, especially India, have come under pressure in the midst of the coronavirus-led economic slowdown. The benchmark Australian thermal coal price, the weekly Newcastle Index, as assessed by commodity price reporting agency Argus, slumped to $48.14 a tonne in the week to June 26, the lowest since November 2006 and down 31% from the peak so far this year of $69.59 in mid-January. The price of lower quality Indonesian coal with an energy content of 4,200 kilocalories per kilogram, ended last week at $23.89 a tonne, the lowest since Argus started assessments in August 2008. In some ways it’s not surprising that Indonesian coal has been hard hit, given its main market is India, where imports have been collapsing. India’s imports of both coking and thermal coal in June are on track to be the lowest since Refinitiv started assessing vessel-tracking and port data in January 2015. Just 8.08 million tonnes of coal had been discharged, or was in the process of discharging by June 29, Refinitiv data shows. While this may still rise when cargoes from the last day of the month are included, it’s likely the total will be well below May’s 10.3 million tonnes, which was sharply lower than the 17.05 million tonnes average of the first four months of 2020. India has imposed a series of lockdowns to combat the spread of the novel coronavirus, which have cut electricity demand, with coal-fired generation taking the brunt of the hit as it struggles to compete with cheaper renewable energy supplies. While India’s economy is expected to start recovering in coming months, it may take some time for coal imports to rebound, especially given the government’s ongoing policy to eliminate the bulk of imports in favour of domestic supplies. India’s imports of Indonesian coal were 3.1 million tonnes in the first 29 days of June, according to Refinitiv, lowest since records start in 2015 and less than half the 8 million reported in February, which was the strongest month this year. Australia, which almost exclusively supplies coking coal to India, also saw its numbers drop, with India importing 1.56 million tonnes up to June 29, down from the peak this year of 3.7 million in January. Coking coal prices have also been suffering, with Singapore Exchange contracts ending at $111.43 a tonne on Monday, up slightly from the recent low of $106 on June 1, which was the weakest since August 2016.China, the world’s biggest producer, consumer and importer or coal, is likely to see declining imports in coming months as the authorities are believed to be pressuring traders and end-users to restrict buying of overseas cargoes in order to ensure domestic prices are high enough for the mines to be profitable.

U.S. report touts Appalachia's coal, gas future despite concerns - (Reuters) - A Trump administration report released on Tuesday touted a strong future for petrochemicals and coal in the U.S. region of Appalachia, despite concerns that supply gluts, waning demand and potential environmental regulation could limit growth in the industries. “There are tremendous opportunities on the horizon for Appalachia because of the shale gas revolution and the region’s abundant coal reserves,” Mark Menezes, the U.S. under secretary of energy, told reporters in a call about the report called “The Appalachian Energy and Petrochemical Renaissance.” The administration of President Donald Trump has pursued a policy of boosting fossil fuel production while slashing environmental regulations. But if Democratic candidate Joe Biden wins the election in November, the fossil fuel industry will likely see new regulations. The Trump administration has also promoted development of a petrochemical hub in Appalachia, a region including West Virginia and parts of Kentucky, Ohio and Pennsylvania, to complement Houston’s energy complex. Trump said last year at a Royal Dutch Shell plastics project in Pennsylvania, a state he won by less than 1 percentage point in 2016, that his administration was “clearing the way for other massive ... investments” in the region. But the petrochemical business in the region has been rocky. Thailand’s PTT and South Korean partner Daelim this month indefinitely delayed an investment decision on a $5.7 billion plastics plant project in Ohio. Meanwhile, U.S. coal consumption last year fell 15% to the lowest level since 1964.

Where’s the plan to help Pennsylvania coal workers? - In a recent hearing in Harrisburg, Sen. Joe Pittman, R-Indiana, vocally opposed Gov. Tom Wolf’s proposal to have Pennsylvania implement a carbon cap-and-invest program similar to the Regional Greenhouse Gas Initiative (RGGI). He argued that the RGGI plan was going to force coal plants in his district to close and because of this, “communities are going to be devastated.” The senator may claim that a cap-and-invest program would devastate the coal facilities in his communities, but the hard truth is that these facilities have been in rapid decline for years and that trend will continue with or without RGGI. As recently as 2007, coal generated over 122 million megawatt-hours of electricity in Pennsylvania, but competition from natural gas generation drove that number down to just over 38 million MWh by 2019. Very soon, only five large conventional steam coal plants will be left including Homer City and Conemaugh in Indiana County along with the Cheswick, Keystone, and Montour plants. More than half of those units are over 50 years old — only one (Homer City’s Unit 3 built in 1977) is younger than 45. They are rapidly approaching retirement, and no new plants are being built in the state to replace them. As these plants age, their operation and maintenance costs will continue to rise and competition from newer gas plants and clean renewable energy will only get more intense. The companies that run these plants have seen the handwriting on the wall. Just last year, PSE&G sold its ownership stake in Keystone and Conemaugh and announced to its shareholders that it is getting out of the coal generation business entirely. We agree that the loss of jobs associated with these coal plants will be devastating for these communities. But for Pittman to blame environmental regulations for the decline of the coal industry is a red herring that detracts attention from the real cause.

Coal communities increasingly rely on federal health programs   - Every July for two decades, volunteer doctors, dentists and nurses gathered at the Wise County Fairgrounds to deliver free medical, dental and vision care. The free clinic attracted thousands of central Appalachian residents, many who camped out the night before to secure their spot in line, as well as media outlets from around the world that were drawn to the dramatic images of people receiving healthcare in trailers and livestock stalls.But this year, the three-day free clinic sponsored by Remote Area Medicine won’t happen. That’s due partly to social distancing restrictions in response to the pandemic, but also because RAM’s local partners “have built infrastructure and capacity around eye, dental, and medical resources in the Wise, Virginia community,” according to a news release. Local organizations such as the Health Wagon and Mission of Mercy had grown to fill the gaps and were now able to stage regular health fairs without RAM’s support.Another contributing factor was Virginia’s expansion of Medicaid beginning in 2019. At the time of the final RAM clinic in Wise in 2019, more than 290,000 Virginians had enrolled in the program. Nearly a year later, that figure has grown to 426,613, including 3,909 people in Wise County — a little more than 10% of its total population.As coal continues to decline as an economic driver, communities in central Appalachia and Wyoming are trying to determine their next steps in maintaining critical health care infrastructure. But healthcare also remains a politically charged issue. The Patient Protection and Affordable Care Act of 2010, also known as Obamacare, has been a flashpoint in partisan politics since it passed. The law brought sweeping changes, including incentives for states to expand their Medicaid programs to cover citizens and legal residents with income up to 138% of the poverty rate. Still, shrinking tax revenues, jobs and resources in the industry are forcing the issue in many parts of coal country, and communities are becoming more reliant on — and even warming to — federal health programs like Medicaid. 

 Public meetings on Alabama Power coal ash ponds start Monday - - This week Alabama Power begins a series of public meetings on plans to reduce the dangers posed by several coal-ash ponds, amid criticism from environmental groups that it should be offering safer options than in-person public gatherings in a time when COVID-19 case counts are rising. The Alabama Rivers Alliance, among others, has charged that the utility “performed virtually no outreach, gave no detailed plans for social distancing precautions, and provided no option for virtual attendance.” As COVID-19 case counts rise, the group said, “We believe it is irresponsible of them to hold public meetings during this time.” “The Unintended Consequences of Convenience,” a video recently released by the Mobile Bay National Estuary Program, lays out the issue: In the 20th century, numerous coal-fired power plants were built near rivers, where coal could be shipped in by barge. Coal ash often was stored in large ponds, so dust wasn’t an issue. A dam failed on such a pond in Tennessee in 2008, sending what the film calls “a slow-moving tsunami” of toxic sludge into nearby tributaries of the Tennessee River. The event raised awareness of the potential hazards of ash, which contains toxic heavy metals, and led to a new federal policy designed to present similar disasters in the future. Mobile Bay NEP says it began making its explanatory video when it was “asked by its Government Networks Committee, made up of elected officials representing coastal Alabama, to present a scientifically objective assessment of issues related to the closure of the coal ash pond at Alabama’s Plant Barry.” Its clinical tone includes many of Alabama Power’s arguments in favor of the capping approach, suggesting that the massive effort to transport the Barry pond’s contents to a landfill would delay resolution of the danger and create problems that might offset the supposed benefits. Meanwhile, Alabama Power argues that its cap-in-place strategy is more comprehensive than the name would suggest. Some of the material will moved to leave more space between the consolidated deposit nearby river banks. Water will be pumped out of the ash and treated before the site is capped, so that the dewatered mass is less likely to seep. Dikes and walls will protect against flooding and leaking, and monitoring will track the results for at least 30 years. Not everyone is convinced. Mobile Baykeeper says its own studies show that Alabama Power is overestimating the risk and difficulties of the haul-it-out solution because cap-in-place is cheaper. It also argues that the approach isn’t even legal at Barry because, given the nature of the site, Baykeeper thinks it can’t meet CCR Rule requirements.

EPA to end policy suspending pollution monitoring by end of summer  The Environmental Protection Agency (EPA) will rescind its controversial policy allowing companies to skip monitoring their pollution by the end of the summer, the agency wrote in a letter to lawmakers. The policy, unveiled in a March 26 memo in an effort to help companies reduce regulatory burdens during the coronavirus, alerted companies they would not face penalties for failing to monitor their pollution emissions as required under a host of environmental laws. EPA said it would terminate the policy August 31, bringing to a close a directive that was previously listed as temporary but with no set end date. “Recognizing that there will be a period of adjustment as regulated entities plan how to effectively comply both with environmental legal obligations and with public health guidance … EPA has established a termination date for the Temporary Policy of August 31, 2020,” the agency wrote in a letter to lawmakers on the House Energy and Commerce Committee. Lawmakers on a number of committees had pressured EPA to quickly end the policy, arguing the agency had no way of knowing how much pollution might be emitted into the air or water without sufficient monitoring. “This policy had no business being put into effect, but fortunately it will be coming to an end soon. We demanded a firm end date because we had feared that the administration would not commit to one otherwise, and might attempt to keep this policy in place indefinitely,” Energy and Commerce Chairman Frank Pallone, Jr. (D-N.J.), Transportation and Infrastructure Chairman Peter DeFazio (D-Ore.) and Appropriations Subcommittee on the Interior and Environment Chairwoman Betty McCollum (D-M.N.) said in a statement. The letter defended the policy at length, arguing that a number of other programs help the EPA monitor spills, leaks, and emissions. “The burden is on the regulated entity to prove to EPA that compliance is not reasonably practicable due to COVID-19,” Susan Bodine, assistant administrator for EPA’s Office of Enforcement and Compliance Assurance, wrote in the letter, adding later that the policy did not appear to be widely used by industry.

 Radiation level increase in northern Europe may ‘indicate damage’ to nuclear power plant in Russia --Low levels of radiation spotted in northern Europe may have come from a malfunctioning nuclear power plant in western Russia.Nuclear safety officials from Finland, Norway and Sweden have all announced earlier this week they have detected increased radioactive isotopes across Scandinavia and in some Arctic regions.While the Swedish Radiation Safety Authority said on Tuesday it was not possible to confirm the source of radiation, Dutch authorities have analysed data from their Nordic neighbours and concluded it originated in western Russia.“The radionuclides are artificial, that is to say they are man-made,” the National Institute for Public Health and the Environment in theNetherlands said on Friday.“The composition of the nuclides may indicate damage to a fuel element in a nuclear power plant [but] a specific source location cannot be identified due to the limited number of measurements.” However, the Russian nuclear power operator Rosenergoatom has denied there are any problems with its two power plants in the country’s northwest.The Russian news agency Tass quoted an unnamed spokesperson from Rosenergoatom who said both a plant near St Petersburg and another near Murmansk were operating “normally, with radiation levels being within the norm”.Radiation levels at the two plants had not changed for the whole month of June, the spokesperson added.“Both stations are working in normal regime. There have been no complaints about the equipment’s work. No incidents related to release of radionuclide outside containment structures have been reported.”

 Public Utilities Commission of Ohio fines Dominion Energy $1 million for Pepper Pike gas explosion -  -- The Public Utilities Commission of Ohio fined Dominion Energy $1 million for a November gas pipeline explosion in Pepper Pike. PUCO determined that the cause of the explosion was the "failure of a 30-inch steel distribution main, that released natural gas into the atmosphere which subsequently ignited," according to a news release from PUCO Wednesday afternoon. PUCO's report says Dominion failed to follow proper procedures, had poor construction practices and a lack of oversight. The agreement also requires Dominion Energy to create a plan to improve its gas safety program. "A third-party consulting firm will investigate and provide a root cause analysis within 90 days. Dominion and PUCO staff will review the analysis and determine an implementation plan," PUCO said in a statement released Wednesday. "A third-party consultant will then evaluate Dominion's adherence to the implementation plan to ensure the company adequately improves its processes and procedures." The company will pay the $1 million to the state with an additional $500,000 that the commission can impose if Dominion Energy does not fulfill the terms of the settlement or implementation plan. A preliminary investigation showed that a welding failure caused a rupture that, in turn, caused an explosion that happened at 12:54 a.m. on Nov. 15 on Shaker Boulevard near the Pepper Pike Services Department. Firefighters from Pepper Pike and Beachwood went door to door to evacuate residents living within the vicinity of the explosion. They were later allowed to return to their homes.

Ohio AG Yost fights to reopen Line 5 pipeline in Great Lakes region - On the eve of a major hearing that could decide the fate of the Great Lakes region’s most controversial pipeline, Ohio Attorney General Dave Yost has asked the hearing’s judge to consider the potential loss of 1,000 northwest Ohio refinery jobs if he allows Enbridge Energy’s Line 5 to remain shut down.In an 11-page brief filed Monday with Ingham County Circuit Court in Lansing, Mich., Mr. Yost — along with attorneys general from Indiana and Louisiana — said the state of Ohio “has a significant interest in the continued operation of the West Line of Enbridge’s Line 5 pipeline and will experience far-reaching consequences if it is shut down.”The brief states that officials recognize “that environmental protection and economic impact are not mutually exclusive” and that Ohio, Michigan, and Indiana all have a duty to protect the Great Lakes. “However, Ohio, Indiana, and Louisiana also owe a duty to their citizens whose livelihoods depend on commerce that crosses state lines,” the brief states.  Line 5 is a 645-mile pipeline owned by Calgary-based Enbridge Energy, the same pipeline company that experienced one of North America’s worst inland oil spills when a pipeline it owns along the Kalamazoo River near Marshall, Mich., burst in 2010. Line 5 became a flashpoint of controversy in early 2018 when the anchor of a boat passing through the Straits of Mackinac dented — but did not rupture — it.Activists quickly underscored the dangers of polluting Lake Michigan and Lake Huron, which sit at the center of the world’s largest collection of freshwater lakes, the Great Lakes. They flow south to Lake Erie.Enbridge worked out a deal with former Michigan Gov. Rick Snyder, a Republican, during the waning days of his administration to build a new pipeline beneath the Straits and submerge it in a tunnel 100 feet below Lake Michigan’s lakebed. That project is expected to cost up to $500 million and take as long as a decade to build.Michigan’s current governor, Democrat Gretchen Whitmer, and that state’s attorney general, Democrat Dana Nessel, campaigned on a platform of shutting down Line 5 to minimize risks to the Great Lakes. The pipeline splits into two as it passes through the Straits. Soon after Enbridge announced recently that an anchor support on the east line had been “significantly” damaged, Ms. Nessel filed a motion to have the entire system shut down on at least a temporary basis. Judge James Jamo granted that motion last Thursday, and scheduled a hearing to discuss the pipeline’s fate for Tuesday. Line 5 serves PBF Energy’s 123-year-old Toledo Refining Co. plant in East Toledo, which employs 585 people, and the BP-Husky Toledo refinery in Oregon, which employs 625 people, according to figures provided by Mr. Yost’s office. 

Reports Offer Different Outlook On Ohio Valley’s Petrochemical Future --A new report by the Trump administration suggests the Ohio Valley’s growing petrochemical industry could be an unprecedented source of economic opportunity and growth when the county, and region, eventually emerge from the COVID-19 pandemic. But the assessment is drawing criticism from environmental groups and some financial analysts that warn the risk is growing for plastics and petrochemical manufacturers.The Department of Energy assessment released Tuesday makes the case that natural gas production in the region, which includes parts of West Virginia, Ohio, Pennsylvania and Kentucky, will continue to grow in the coming decades. The report argues the region is on the “cusp of an energy and petrochemical renaissance” due to the fact that gas extracted from the region is rich in natural gas liquids, including ethane, the building block of many plastics and chemicals, and the Ohio Valley’s proximity to the bulk of downstream manufacturers. The 75-page document was commissioned under president Donald Trump’s April 2019 executive order “Promoting Energy Infrastructure and Economic Growth.” Six additional federal agencies and the Appalachian Regional Commission contributed. Officials in the region have been working on the so-called Appalachian Storage and Trading Hub for nearly a decade. The natural gas storage hub cleared its first major hurdle in 2018 when it got approval for the first of two phases for a $1.9 billion U.S. Department of Energy loan. A previous DOE report, requested by lawmakers in Congress, found the hub is crucial for growing the region’s petrochemical industry. Sarah Carballo, a communications specialist with the Ohio Valley Environmental Coalition, a regional advocacy group, said the new DOE report did not take into account the growing financial risk associated with a regional petrochemical industry buildout, or the concerns of some residents in the region. “Communities across Appalachia deserve viable, fair and sustainable economic transition strategies that protect public health and environmental quality,” she said. “So, instead of investing in petrochemicals and coal as a basis for economic renaissance — industries that poisoned our land, air, water, communities — we think it’s time for our leaders to explore more feasible and sustainable economic development strategies that provide long term prosperity for the people of our region.”

Fracking Trailblazer Chesapeake Energy Files for Bankruptcy -  Chesapeake Energy filed for bankruptcy protection Sunday as an oil- and gas-price rout stoked by the coronavirus pandemic proved to be the final blow for a shale-drilling pioneer long hamstrung by debt. Chesapeake is the latest debt-laden U.S. oil and gas producer to file for bankruptcy, as a coronavirus-induced economic slowdown saps demand for fossil fuels. More than 200 shale companies may file for bankruptcy over the next two years if oil and gas prices stay around current levels, analysts say. Co-founded in 1989 by the late wildcatter Aubrey McClendon, the company was early to recognize that horizontal drilling and hydraulic fracturing could unlock vast troves of natural gas, a trend that led to a rebirth of American fossil-fuel output and eventually made the U.S. the top oil producer in the world. By the end of 2008, the Oklahoma City-based company had drilling rights to nearly 15 million acres, according to a securities filing, an empire roughly the size of West Virginia. That vast footprint once helped Chesapeake earn the title of second-largest U.S. gas producer. But Chesapeake’s breakneck growth left it highly leveraged, and it was far slower than many of its peers to pivot to tapping shale formations for oil, which turned out to be much more lucrative than gas. U.S. natural gas prices are at their lowest levels in years. The result was a painful fall in recent years as Chesapeake shrank, selling assets to pare debt before winding up in bankruptcy court. “They were at the forefront, and they were the most aggressive. But because of how aggressive they were, it left them unable to pivot to what ended up being the real moneymaker,” said Chris Duncan, a Brandes Investment Partners director with a say in mutual funds that own Chesapeake debt. Chesapeake, which filed for chapter 11 protection with more than three dozen affiliated companies, listed assets of $16.2 billion and liabilities of $11.8 billion in its petition with the U.S. Bankruptcy Court in Houston. The company reached a restructuring agreement with many of its lenders that is intended to guide the bankruptcy process and seeks to eliminate some $7 billion in debt.

Chesapeake Files For Bankruptcy, Wiping Out $7 Billion In Debt And Any Existing Equity Value - After years of melting, the Chesapeake icecube is finally history: at exactly 350pm on Sunday afternoon, the company that launched the US shale boom, finally gave up and filed for a pre-packaged bankruptcy in the Southern District of Texas. In so doing, the company with roughly $9.5 billion in debt has become one of the biggest victims of a spectacular collapse in energy demand from the virus-induced global recession, and follows the collapse of another high-flyer in the US oil patch, Whiting Petroleum, which filed for Chapter 11 at the start of April after championing what was once the premiere U.S. shale field, the Bakken of North Dakota. As part of its prepack agreement, Chesapeake announced that it had entered into a Restructuring Support Agreement ("RSA") with 100% of the lenders under its revolving credit facility, holders of approximately 87% of the obligations under its Term Loan Agreement, approximately 60% of its senior secured second lien notes due 2025, and approximately 27% of its senior unsecured notes, pursuant to which Chesapeake will implement a Chapter 11 plan of reorganization to eliminate approximately $7 billion of debt. Of course, since 73% of unsecured bondholders refused to sign off on the deal, expect a very vicious bankruptcy fight over the recoveries, as hedge funds that accumulated positions in the bonds unleash hell in their fight with the secureds (even as the equity committee claims that all classes above it should be unimpaired). Also, we have some bad news for Jefferies, which won't be able to repeat its hilarious attempt to fund the company in bankruptcy by selling stock to Robnhood daytraders: as part of the RSA, the Company has secured $925 million in debtor-in-possession financing lenders under Chesapeake's revolving credit facility. The DIP will provide Chesapeake the capital necessary to fund its operations during the Court-supervised Chapter 11 reorganization proceedings. To summarize: Chesapeake which enters bankruptcy with just over $9.5 billion in debt... ... will eliminate about $7 billion of it, and emerge with a $2.5 billion exit financing, consisting of a new $1.75 billion revolving credit facility and a new $750 million term loan. Additionally, according to the RSA, the Company has the support of its term loan lenders and secured note holders to backstop a $600 million rights offering upon exit. 

Chesapeake Energy’s Long Road to Bankruptcy  -- Chesapeake has been a dead man walking for the best part of a decade. The company will reorganize approximately $7 billion in debt and receive $925 million in debtor-in-possession (DIP) financing to continue operating. Chesapeake also has secured a $600 million rights offering, backstopped by some of its existing lenders, and a $2.5 billion exit financing package. At the end of March, Chesapeake reported $9.2 billion in long-term debt. According to Bloomberg, the company listed assets of $10 billion and liabilities of $50 billion. CEO Doug Lawler, who took over in 2013, said that even though the company had eliminated some $20 billion of leverage and financial commitments, “we believe this restructuring is necessary for the long-term success and value creation of the business.”   In its early days, the company, under co-founder and CEO Aubrey McClendon, was an early adopter of the drilling practice that has come to be known as fracking. In the middle of the first decade of the 21st century, natural gas prices soared to more than $13 per million BTUs in 2008 (as of Monday morning, the price is around $1.60 for an equivalent amount). If the company couldn’t make money once prices collapsed, the next best thing was to buy and sell leasing rights to proven reserves. The company’s business model began to emphasize an aggressive plan to lease acreage in many shale gas plays. Next, the company proved the presence of the energy resource and, finally, flipped the property for a profit. In early 2012, for example, Chesapeake sold a 25% stake in its leases in Ohio’s Utica shale play to French oil major Total for $2.3 billion. At time, McClendon said, “This Utica transaction is our seventh significant JV and in these seven JVs, Chesapeake has sold approximately 1.5 million net acres for total leasehold consideration of $14.8 billion while retaining 3.6 million net acres as of the JV date with an indicated value by the JV partners of $45.7 billion.” By then, natural gas traded at around $3 per million BTUs.  A few months later, Chesapeake’s board discovered (it said) that McClendon had reportedly borrowed up to $1.1 billion using his interests in Chesapeake’s wells as collateral without disclosing the loans to shareholders. In May, the board ousted McClendon as board chair and terminated the program that gave him the right to participate in every new well the company drilled.  In June, Reuters reported that it had discovered a series of emails between Chesapeake and Canadian oil and gas firm Encana that suggested the companies had engaged in bid-rigging. (Encana changed its name to Ovintiv in January 2020 and moved its headquarters to the United States.) In 2016, McClendon was indicted on the charges. The day following that announcement, he was killed in car crash.

Hidden wine cave, $110 million parking bill: Energy collapse wasn't only thing that sunk Chesapeake - Fracking giant Chesapeake Energy's bankruptcy filing comes following a financial mess at the company that included no budgets, a massive wine collection and a nine-figure bill for parking garages, sources told CNBC's David Faber. CEO Robert D. "Doug" Lawler found in examining the company's books a $110 million bill for two parking garages, Faber reported Monday. That was part of about $30 billion in spending above cash flow that happened from 2010-12, while the late Aubrey McClendon was CEO and prior to Lawler taking over in 2013. Other revelations include a wine collection in a cave hidden behind a broom closet in the Chesapeake office. Extravagances further included a season ticket package to the NBA's Oklahoma City Thunder that was the biggest in the league and a lavish campus that was modeled after Duke University, complete with bee keepers, botox treatments and chaplains for employees. The company announced its bankruptcy filing on Sunday, amid a brutal time for the energy sector. Prices have tumbled throughout the coronavirus pandemic as demand has crumbled and the economic expansion that began in 2009 ended in February. Chesapeake's share price has fallen nearly 93% in 2020. "While today is a challenging day, your leadership team and I are confident that this is the best path forward for Chesapeake, and that we will emerge from the Chapter 11 process as a stronger and more competitive company," Lawler said in a memo to employees. In the Chapter 11 announcement, Lawler added that the company is "fundamentally resetting" its capital structure and business "to address our legacy financial weaknesses and capitalize on our substantial operational strengths." Chesapeake declined comment for this report.

Chesapeake Energy files for bankruptcy, as details emerge of wine cellars and botox - From 2010 to 2012, the company spent $30 billion more in drilling and leasing than it made from its operations.Chesapeake Energy, the poster child of the U.S. shale revolution, filed for bankruptcy protection on Sunday. The move comes as the company and industry more broadly has been rocked by a drop in oil and gas prices amid the coronavirus pandemic. The heavily indebted company has been in trouble for some time, and in May said that it had concerns regarding its long-term viability. Chesapeake said that $7 billion in debt will be wiped out through the restructuring. The company has secured $925 million in debtor-in-possession financing in order to continue operations during the bankruptcy process. In addition, Chesapeake has secured an agreement in principle from certain existing lenders for $2.5 billion in debt financing on emergence from bankruptcy, as well as a backstop commitment for $600 million in new equity. Franklin Resources and Fidelity are among the biggest creditors, according to people close to the company, and they will be among the primary equity holders following the company’s restructuring. The company will continue operations at a much reduced capacity, with a handful of gas rigs and no oil rigs, according to those familiar with the company’s plans. Chesapeake Energy was founded in 1989 by Aubrey McClendon. An early pioneer of horizontal drilling, he built the company into a key player in the U.S. gas industry. At its peak, Chesapeake had 175 operating rigs, with operations across the U.S. including in Texas, Louisiana, Pennsylvania and Ohio. But the company took on a lot of debt to fuel its rapid expansion, and from 2010 to 2012 spent $30 billion more in drilling and leasing than it made from its operations. The fracking giant’s bankruptcy filing comes following a financial mess at the company that included no budgets, a massive wine collection and a nine-figure bill for parking garages, sources told CNBC’s David Faber.CEO Robert D. “Doug” Lawler found in examining the company’s books a $110 million bill for two parking garages, Faber reported Monday. Other revelations include a wine collection in a cave hidden behind a broom closet in the Chesapeake office. Extravagances further included a season ticket package to the NBA’s Oklahoma City Thunder that was the biggest in the league and a lavish campus that was modeled after Duke University, complete with bee keepers, botox treatments and chaplains for employees.

Chesapeake asks to cancel pipeline contracts, sets drilling cuts - (Reuters) - Chesapeake Energy Corp on Monday sought bankruptcy court approval to cancel $311 million in pipeline contracts, setting up a battle with U.S. regulators and operators including Energy Transfer LP, according to court filings. Chesapeake on Sunday became the largest U.S. oil and gas producer to seek bankruptcy protection in at least five years, falling to heavy debt and the impact of the coronavirus outbreak on energy markets. The company separately said in a filing it plans to operate six to eight drilling rigs for the next two years, about half the 14 rigs active on average in the first quarter, as it battles a historic downturn in oil prices. The shale pioneer wants to walk away from contracts with units of Energy Transfer, Boardwalk Pipelines, and a Crestwood Equity Partners and Consolidated Edison gas joint venture. The contracts involve about $293 million with Energy Transfer’s Tiger Pipeline and $18 million with Boardwalk’s Gulf South Pipeline. Neither Energy Transfer, Boardwalk nor Chesapeake responded to a request for comment. U.S. pipeline regulator, the Federal Energy Regulatory Commission, last week barred Chesapeake from altering its agreement with Energy Transfer and is set to weigh similar requests from Gulf South and from Stagecoach Pipeline & Storage Co, owned by Crestwood Equity Partners and Consolidated Edison. Crestwood said it is positioned to maintain operations for Chesapeake, including its Stagecoach unit. However, Chesapeake must show any rejection benefits the public good for FERC to approve it, a Crestwood spokesman said. Cancelling the contracts are key to winning creditors’ consent of its debt restructuring, Chesapeake told U.S. Bankruptcy court Judge David Jones in a filing. The battle could represent a turning point in energy bankruptcies, said Matthew Lewis, director at pipeline research firm East Daley Capital, with FERC seeking equal footing with interstate pipeline contracts. If FERC is “less liberal with contract rejection, it could force more renegotiations of contracts,” instead of outright cancellations, Lewis said.

Chesapeake sues FERC over pipeline contracts - Chesapeake Energy has sued the Federal Energy Regulatory Commission to keep two pipeline companies from interfering in its Chapter 11 reorganization, Kallanish Energy reports. Named in the suit were ETC Tiger Pipeline LLC and Gulf Southern. Chesapeake Energy is seeking to reject certain negotiated contracts with the pipeline companies for moving natural gas. It wants the federal bankruptcy court, not FERC, to decide the issue. Chesapeake is the sixth-largest natural gas producer in the United States. It was once the No.2 natural gas producer in the country. The company’s Chapter 11 filing on Sunday kicks off one of the biggest energy bankruptcies in recent years. Chesapeake has asked the U.S. Bankruptcy Court in the Southern District of Texas to prevent legal action by the two pipeline companies, saying that to fulfill the contracts would endanger its negotiated reorganization plan to eliminate $7 billion in debt. At year-end 2019, it had $9 billion in debt. The Oklahoma-based company said it had paid $890 million since early 2009 for pipeline transportation under existing agreements with the two companies. Chesapeake owes $311 million for the remainder of the contracts. Both companies last month petitioned FERC to protect their contracts with Chesapeake. If FERC orders Chesapeake to comply with those terms, its Chapter 11 reorganization would face “irreparable harm,” it said in the court filing. Chesapeake said they would likely file an appeal with a U.S. Court of Appeals if FERC orders those contracts to be upheld. A third pipeline company, Stagecoach Pipeline & Storage, made a similar filing with FERC earlier this month. In its Sunday filing, Chesapeake Energy cited debts of $10 billion and its reorganization will affect drilling service companies and pipeline companies from Pennsylvania to Texas to Wyoming. Companies including Williams, Energy Transfer, and Crestwood Equity Partners all have contracts with Chesapeake that may be reduced or rejected in bankruptcy court, said Ryan Smith of East Daley Capital in a Reuters report. Chesapeake is a major player in the Marcellus Shale in the Appalachian Basin, the Hayesville Shale in Louisiana and Texas, the Eagle Ford and Brazos Valley in Texas, in the Powder River Basin in Wyoming and Montana and the Mid-Continent in Oklahoma. It was the major player in the Utica Shale in eastern Ohio but later divested those assets.

Chesapeake Bankruptcy Extends String of 2020 Shale Busts -- The shale bust has reached a grim milestone by claiming the pioneer of America’s drilling renaissance. But Chesapeake Energy Corp., which filed for bankruptcy protection on Sunday, is just the latest in a long list of casualties. More than 200 North American oil and gas producers, owing over $130 billion in debt, have filed for bankruptcy since the beginning of 2015, according to a May report from law firm Haynes & Boone. This year alone, at least 20 have gone under after oil prices plunged amid the Covid-19 pandemic. The shale boom spearheaded by the likes of Chesapeake a decade ago was fueled by debt. Profitability and shareholder returns have been consistently disappointing, and investors had already grown wary of throwing more money into shale before this year’s oil crash. The rate of default on high-yield energy debt stood at 11%, Fitch Ratings said in a June 11 report, the highest level since April 2017. Here are a handful other notable shale bankruptcies so far this year:

  • Whiting Petroleum -An oil explorer focused on the Bakken Shale in North Dakota, Whiting Petroleum Corp. was already facing headwinds prior to 2020. Last year, the Denver-based company announced it would fire a third of its workforce and scale back production targets after posting a surprise quarterly loss.
  • Extraction Oil & Gas - Another Colorado driller, Extraction Oil & Gas Inc. focused exclusively on the Denver-Julesburg Basin in the Rockies. It filed for Chapter 11 on June 15, offering to ease its debt burden of roughly $1.5 billion by giving note holders 97% of new common stock to be issued. Extraction had withdrawn its 2020 guidance in May and warned it may have to file for bankruptcy. Then, in early June, the company announced plans to pay 16 executives and senior managers a total of $6.7 million in return for staying with Extraction ahead of a possible default on its bond payments.
  • Ultra Petroleum - Once wasn’t enough. Ultra Petroleum Corp. filed for its second bankruptcy in May, four years after its first. Listing $2.56 billion in debt and $1.45 billion in assets in its Chapter 11 filing, the Englewood, Colorado, driller reached a deal with most of its senior creditors that would slash $2 billion in debt, while looking to restructure within three months.
  • Sable Permian Resources - Soon after his ouster from Chesapeake in 2013, co-founder Aubrey McClendon went to work building a new empire, American Energy Partners. Part of that business, American Energy - Permian Basin, merged with Sable Permian Resources LLC last year. That particular business was widely seen as having among the best assets of a half dozen oil-and-gas acquisition vehicles that McClendon set up during his brief tenure at American Energy Partners.Sable filed for bankruptcy last week in Houston alongside affiliates, listing at least $1 billion of assets and liabilities each.

Pennsylvania impact fee could be lower next year - Pittsburgh Business Times -New well spuds dropped 29% to 255 across Pennsylvania between January and June, according to data from the Pennsylvania Department of Environmental Protection.

Wolf Administration advances proposed emission limits on thousands of oil and gas sites   - The Wolf Administration wants to limit emissions from thousands of oil and natural gas sites in Pennsylvania. It’s proposing a new regulation that would require better monitoring and control of emissions at existing oil and gas wells, including those that use hydraulic fracturing, and related sites. Companies would have to install equipment to stop emissions from escaping, and inspect sites for leaks every three months. The rule targets volatile organic compounds (VOCs), which contribute to ozone and can affect people’s health. The Department of Environmental Protection says the tighter controls will also prevent leaks of the potent greenhouse gas methane. DEP said the rule would reduce annual air pollution by 4,404 tons of VOCs and 75,603 tons of methane. A recent Environmental Defense Fund study found  Pennsylvania’s shale gas industry leaked more than 1 million tons of methane in 2017 — seven times more than state reporting showed. People can offer written comments on the plan through July. They can also participate in their choice of three virtual hearings in June. In 2018, the Wolf Administration enacted a similar regulation for new sources of emissions, as part of the governor’s plan to reduce methane leaks and fight climate change. The administration has faced criticism from environmental groups for moving too slowly on the new rule. Methane is the main component of natural gas. Compared to carbon dioxide, it has about 30 times the warming power, according to the Environmental Protection Agency. Scientists say greenhouses gases must be curbed significantly to stop the worst effects of climate change. “Pennsylvania is one of the leading states in the country as far as natural gas production, and to have existing source regulations in Pennsylvania will make a dent into the climate pollution problem that we have in this country,” said Dan Grossman, senior director of state advocacy for the Environmental Defense Fund. He added that enactment in Pennsylvania could spur adoption of methane standards in other oil and gas producing states. Colorado, California, and Ohio have created similar rules.

Department of Health says it is looking into fracking public health risks following grand jury report -The Pennsylvania Department of Health says it is taking steps to learn more about the health risks of fracking following criticism from an investigative grand jury.The department’s comments come days after the grand jury’s report said the Pennsylvania Department of Environmental Protection and the health department failed to protect people from the adverse health effects of the fracking boom that began about 10 years ago.The report​, which resulted from a two-year investigation, describes drinking water turned brown from chemical-intensive fracking operations, and includes testimony describing children and adults getting sick, animals dying and, in one case, a state DEP that threatened someone who spoke up with “filing a false report” rather than helping them.While the DEP took the brunt of the criticism in the report, the grand jury also criticized the health department’s response, saying it was “unable to meet the challenge” of understanding how fracking could affect people.The health department did launch two studies in November to look at the role of fracking in Ewing sarcoma and childhood cancers in Southwestern Pennsylvania, and is committing $3.9 million to those studies over three years, said spokesman Nate Wardle.In a formal response to the grand jury report, Health Secretary Dr. Rachel Levine said the report was a helpful tool for the department to continue to improve in its public health role. However, the department already has taken some of the measures recommended in the report, such as setting up an oil and natural gas registry that allows people to submit public health complaints. Some of the other measures would require action by the state legislature, Levine said.  Read the grand jury report:

Attorney: Politics at play in pipeline prosecution — The attorney who won dismissal of criminal charges against a Delaware County man accused of orchestrating a “buy-a-badge” scheme to provide security for the controversial Mariner East 2 pipeline construction project said Monday that the case had been unduly influenced by political considerations rather than “sound, fair prosecutorial decisions.” Justin Danilewitz of the Philadelphia law firm of Saul, Ewing, Arnstein & Lehr said in an interview that he had urged the Chester County District Attorney’s Office on multiple occasions not to file charges of bribery and conspiracy against his client, Frank Recknagel, the head of security for Energy Transfers Partners, the parent company of Sunoco Pipelines, which is building the massive project through Chester and Delaware counties. He said he had given the prosecution ample evidence that Recknagel had done nothing wrong in getting state constables to work as off-duty security on the pipeline, and had been in consultation with local township police and elected officials about their work. But he was ultimately put off, and left shaken after the charges were filed late last year. On Thursday, Magisterial District Judge John Bailey of West Whiteland dismissed all charges against Recknagel at the conclusion of a five-hour-long preliminary hearing. Bailey determined that the prosecution had not shown that Recknagel had sought to commit a crime in the matter, and had, in fact, tried the best he could to follow the law, Danilewitz said. “Our argument to the judge was essentially no different than the argument we made to the D.A.’s Office on many occasions,” Danilewitz, who was assisted in Recknagel’s defense by defense attorney Thomas Bellwoar of West Chester. “Our client had no criminal intent. Our point was that he was a careful security person, and that he would ultimately be vindicated.

High Court Wants White House View on PennEast Pipeline Case - The U.S. Supreme Court wants the Trump administration’s views on a major energy case that could decide the fate of the proposed PennEast pipeline. At issue is whether developers can seize state-owned land in New Jersey to build the $1 billion natural gas project, which is backed by Enbridge Inc., Southern Co., and other companies. The justices on Monday asked the solicitor general to file a brief expressing the U.S. views on the question—a sign of interest in the case. The move comes as pipeline opponents increasingly ask judges to halt development, and industry lawyers look to the high court to intercede. The justices did just that two weeks ago when they resolved a separate pipeline dispute, siding with the natural gas industry and the Trump administration in a case involving the Atlantic Coast project. PennEast supporters say the industry will face severe disruptions—giving states a new tool to block projects—if the Supreme Court leaves a lower court’s decision in place.The project is slated to move natural gas 116 miles across Pennsylvania and New Jersey, and is part of a broader buildout of gas infrastructure across the East Coast. PennEast pipeline spokeswoman Patricia Kornick said the project backers are pleased the Supreme Court requested the administration’s views on the case. “PennEast remains hopeful that the U.S. Supreme Court will grant the petition,” she said in an email. The Interstate Natural Gas Association of America likewise said it welcomed the development.

 'Gimmick' is how future pipelines will avoid environmental and permitting issues - What if PennEast could secure a pipeline through Hopewell without having to apply for a single permit? Recently, several residents, who live along Jacobs Creek, received a letter from a representative of Sunoco Logistics Partners LP (Sunoco) that it had filed an application for an “Emergency Repair” permit with the New Jersey Department of Environmental Protection (DEP), that they had 15 days to visit the DEP offices or the township clerk’s office to examine Sunoco’s application and file any objections. Unbeknownst to all residents with whom we spoke, including several who have lived along the creek for over 50 years, there is an underground pipeline beneath Jacobs Creek, which is the subject of the Sunoco permit. Sunoco’s letter proposes “Two (2) 1250-foot HDD [horizontal directional drill] pipeline strings,” a replacement and an additional pipeline, or two new pipelines. Why have a pipeline beneath a fresh water stream in the first place? The creek is a source for wildlife, including birds, deer, red foxes, raccoons, and other small animals, to drink and bathe. And yes, this is the same creek that General George Washington and his ragtag army traversed to surprise the Hessians at the Battle of Trenton, changing the course of the Revolutionary War. Since this pipeline predates the 1970s, we have learned much about the ecology of streams, wetlands and the flora and fauna in the habitat that the creek supports. According to Sunoco’s 2016 SEC Form 10-K, Sunoco plans to transport NGLs [natural gas liquids] from the Marcellus and Utica Shale areas in Pennsylvania, West Virginia and Ohio east, through Northern Pennsylvania, across the Delaware River to Northern New Jersey, then south through New Jersey, and then west, back across the Delaware River at Jacobs Creek, into Pennsylvania and south, down to its Marcus Hook refinery. With the “total takeaway capacity to 345 thousand barrels per day.” There is a global glut of fossil fuels, they at historically low prices, another fracker, Chesapeake Energy, just filed for bankruptcy, and renewable energy is cheap. Therefore, these pipelines are unnecessary. PennEast has been unsuccessfully trying to put a pipeline through this area for years. Is Sunoco/PennEast just using this “Emergency Repair” Permit Application as a ruse to install two new pipelines, circumventing the necessary permit process? Then, afterwards, Sunoco could sell or lease these pipelines, maybe even to PennEast? If this ploy is successful here, maybe this gimmick is how future pipelines will avoid environmental and permitting issues: find an old pipeline, get a permit for “repair,” in which it is actually replaced, then sneak in an additional pipeline. This would yield two brand new pipelines and avoid the messy business of having to apply for all those nasty permits. Genius!

Controversial gas pipeline project that would run through Chesapeake delayed - State regulators declined for now to give the go-ahead for a proposed $346 million gas pipeline project that would run through Chesapeake, arguing Virginia Natural Gas needs to do more legwork on securing financing and environmental justice issues before construction. Opponents of the Header Improvement Project said it would affect communities of color and people living on low incomes, exposing them to air and noise pollution. For now, Virginia Natural Gas has until Dec. 31 to meet a host of requirements laid out in an 18-page ruling Friday from the State Corporation Commission. That includes addressing financial concerns raised during recent testimony from the primary driver of the project, an electricity-generating plant known as C4GT, as well as protecting the utility’s ratepayers from added costs. A Virginia Natural Gas spokesman, Rick DelaHaya, said in an email Monday that the company will work with state officials “to develop a model project that meets all regulations.” A number of concerned residents and groups including the Sierra Club and Chesapeake Climate Action Network have cried foul on the project, saying the pipelines and compressor stations used to push gas through the pipelines would be built around communities predominantly composed of African Americans and Latinos. The project includes three new pipelines totaling 24 miles and three new or expanded gas compressor stations spanning northern Virginia to Hampton Roads.

Belinda Joyner Is Tired of Fighting the Atlantic Coast Pipeline, But She’s Still Fighting - “We are tired of being dumped on.”In February, Belinda Joyner caught a ride to the U.S. Supreme Court.  Alongside a couple of close friends, the 67-year-old rode from her home in Garysburg, a 1,000-person town near the North Carolina-Virginia border, up to Washington, D.C.They were there to watch the court hear arguments over whether the U.S. Forest Service should be allowed to issue permits for the Atlantic Coast Pipeline to be built through national forest lands connected to the Appalachian Trail.The 600-mile, $8 billion pipeline—spearheaded by Dominion Energy and Duke Energy and first proposed in 2014—would run through West Virginia, Virginia, and North Carolina, delivering some 1.5 billion cubic feet of natural gas per day from the Appalachian Basin. In North Carolina, the pipeline is set to snake through eight counties: Halifax, Nash, Wilson, Johnston, Sampson, Cumberland, Robeson, and Northampton—Joyner’s back yard.This week, the Supreme Court ruled 7–2 to allow the companies to secure right-of-way under the AT.The ruling was a blow to Joyner and her neighbors. The pipeline, they say, is just the latest example of unwanted industry development disrupting their community with dire consequences for human and environmental health. But in the marathon that is the fight for environmental justice, setbacks come with the territory. In the shadow of the nearby second-home tourist haven Lake Gaston, Northampton County, with its predominantly Black population, has been a hotbed of environmental activism for more than 25 years. But with the ACP halfway in the ground and the nearby Enviva wood-pellet facility recently granted permits to expand by the state Department of Environmental Quality—a development that raises additional concerns over air pollution—community members say they’ve been worn down by the Sisyphean task of fighting for a healthy future.“[The companies] don’t live here, so they don’t have to suffer with the damage they cause to the community,” Joyner says. “We are tired of being dumped on.”

U.S. natgas futures jump 10% on forecasts for warmer weather - (Reuters) - U.S. natural gas futures rose over 10% on Monday, regaining ground after slumping to a more than 25-year low the previous session, as forecasts for warmer weather drove expectations of higher cooling demand for the fuel. In its first day as the front month, gas futures for August delivery rose 16.5 cents, or 10.7%, to settle at $1.709 per million British thermal units (mmBtu). Prices had earlier touched their highest since June 15 at $1.753. U.S. natural gas futures slumped to their lowest since August 1995 in the previous session as the market focused on demand destruction from the coronavirus, swelling stockpiles and lower liquefied natural gas exports earlier in the month. "With temperatures going up, cooling demand has increased and forecasts say they will continue to increase. Along with that, Chesapeake's restructuring has also signaled some drop in supply," said Phil Flynn, Price Futures Group senior market analyst. Chesapeake Energy filed for Chapter 11 on Sunday, becoming the largest U.S. oil and gas producer to seek bankruptcy protection in recent years as it bowed to heavy debts and the impact of the coronavirus outbreak on energy markets. Refinitiv data indicated 222 cooling degree days (CDDs) in the lower 48 states over the next two weeks. The normal is 190 CDDs for this time of year. Prolonged lockdowns to curb the spread of coronavirus have kept many U.S. businesses shut, curbing LNG demand. LNG exports have also fallen, dropping by half since the start of 2020, with burgeoning stockpiles expected to reach a record 4.1 trillion cubic feet by the end of October. Refinitiv said production in the Lower 48 U.S. states averaged 87.8 billion cubic feet per day (bcfd) in June, down from a 16-month low of 88.2 bcfd in May and an all-time monthly high of 95.4 bcfd in November.

-U.S. natgas hits 3-week high, wraps up best quarter since mid-2018 -  (Reuters) - U.S. natural gas futures rose to their highest in nearly three weeks on Tuesday, ending the best quarter since June 2018, as forecasts for hotter-than-normal weather increased demand for cooling. August futures rose 4.2 cents, or 2.5%, to settle at $1.751 per million British thermal units, having jumped more than 14% on Monday, the biggest daily gain since January 2019. Prices have gained nearly 7% this quarter, the most since June 2018. "We are seeing some support coming from expectation of summer heat and after last week's collapse some prolonged heat could actually start to bring in the extra demand and curb injections a little bit lower," said Daniel Myers, senior market analyst at Gelber & Associates. Refinitiv data indicated 243 cooling degree days (CDDs) in the lower 48 states over the next two weeks. The normal is 191 CDDs for this time of year. "Prices might have some trouble holding these gains until LNG export demand goes up and if supply does not ramp up as expected by many investors," Myers said. For the month, futures suffered their second straight fall after slumping to their lowest since August 1995 last week, hurt by demand destruction from the coronavirus, swelling stockpiles and lower liquefied natural gas exports earlier in the month. Prolonged lockdowns to curb the spread of the coronavirus have kept many businesses shut, cutting U.S. LNG exports by half since the start of the year with stockpiles filling fast, expected to reach a record 4.1 trillion cubic feet by the end of October. Chesapeake on Sunday became the largest U.S. oil and gas producer to seek bankruptcy protection in at least five years, falling to heavy debt and the impact of the coronavirus outbreak on energy markets.

U.S. natgas breaks 3-day win streak as virus cases resurge -  (Reuters) - U.S. natural gas futures on Wednesday snapped a three-session gaining streak as concerns about another lockdown due to surging coronavirus infections clouded demand outlook. The August gas futures contract fell 8 cents, or 4.6%, to settle at $1.671 per million British thermal units, having hit its highest since June 12 in the last session. The front-month contract also posted its biggest quarterly rise since June 2018 on Tuesday. "We are seeing some investors walking away with profit as concerns of another wave of coronavirus is resurfacing on the horizon," said Raymond James analyst Muhammed Ghulam. Increases in infection have fueled concerns of another lockdown, which could lead to closure of offices and factories, in turn reducing the demand for electricity and cooling, Ghulam added. New U.S. COVID-19 cases rose by more than 47,000 on Tuesday, according to a Reuters tally, the biggest one-day spike since the start of the pandemic, as the government's top infectious disease expert, Dr. Anthony Fauci, warned that number could soon double. Prolonged lockdowns to curb the spread of the coronavirus have kept many businesses shut, cutting U.S. LNG exports by half since the start of the year with stockpiles filling fast, expected to reach a record 4.1 trillion cubic feet by the end of October. "The expected end of season higher storage level is the most significant factor that keeps a lid on gas prices at this point," said Zhen Zhu, economist at Oklahoma City-based C.H. Guernsey. However, "several factors are still providing some support to prices: summer weather uncertainty (more on the warmer than normal side), possible damaging tropical storms, and expected gas lower production for this year." Weather forecasts pointed toward a warm summer with Refinitiv data indicating 248 cooling degree days (CDDs) in the Lower 48 states over the next two weeks. The normal is 193 CDDs for this time of year.

US working natural gas storage volumes rise by 65 Bcf on week: EIA | S&P Global Platts — One week after it reported a much larger injection than the market expected, the US Energy Information Administration estimated a smaller-than-expected addition to US storage fields for the week ended June 26, boosting the remaining Henry Hub summer strip by 4 cents, as analysts struggle to nail down weekly injections during this period of mid-summer demand and wavering coronavirus restrictions. The amount of natural gas in US underground storage facilities increased by 65 Bcf to 3.077 Tcf, according to US Energy Information Administration data released July 2. The injection was much smaller than the consensus expectations of analysts surveyed by S&P Global Platts, which called for a 77 Bcf build. Responses to the survey ranged from an injection of 66 Bcf to one of 85 Bcf. The injection was also smaller than the 92 Bcf build reported during the same week a year earlier, but it matched the five-year average increase of 65 Bcf, according to EIA data. The injection was nearly 50% smaller than the build reported the week prior as warmer temperatures boosted gas-fired power generation and LNG feedgas deliveries showed some signs of recovery. Power burn estimates ramped up 5.9 Bcf/d while feedgas demand increased by 300 MMcf/d, according to S&P Global Platts Analytics. However, residential and commercial as well as industrial demand, fell by a combined 800 MMcf/d week over week. Storage volumes now stand 712 Bcf, or 30%, above the year-ago level of 2.365 Tcf and 466 Bcf, or 18%, higher than the five-year average of 2.611 Tcf. The NYMEX Henry Hub balance-of-summer contract, August through October, increased 5 cents to $1.78/MMBtu in trading following the release of the data. The ICE end-of-season storage contract is treading close to the 4 Tcf mark as nearly all regions are on track for high storage fills by the end of the season, in some cases possibly prompting a drop in supplies by late summer as caverns reach their upper limits. S&P Global Platts Analytics' supply and demand model currently expects a 59 Bcf injection for the week ending July 3, which would be 9 Bcf below the five-year average. Fundamentals have seen a continued tightening in supply and demand balances by an additional 1.8 Bcf/d compared with the week prior. Total supplies have held essentially flat, but warmer weather has contributed roughly 2.2 Bcf/d of incremental demand from the power sector as the market enters the peak months of the cooling season.

U.S. natgas futures gain as cooling demand reduces injection  U.S. natural gas futures rose on Thursday after a federal report showed a smaller-than-expected storage build last week amid greater demand for cooling as the weather turned hotter in the United States. The August gas futures contract was up 6.3 cents, or 3.7%, to settle at $1.734 per million British thermal units. “Warmer-than-expected weather has increased cooling demand and that is being reflected in the report with injection coming below expectations,” said Thomas Saal, senior vice president of energy at INTL FCStone. Weather forecasts pointed toward a hot summer, with Refinitiv data indicating 248 cooling degree days (CDDs) in the Lower 48 states over the next two weeks. The normal for this time of year is 194 CDDs. The U.S. Energy Information Administration said U.S. utilities injected 65 billion cubic feet (bcf) of natural gas into storage last week, lower than the 78 bcf forecast by a Reuters poll on Wednesday. The increase during the week ended June 26 has increased stockpiles to 3.077 trillion cubic feet (tcf), which is still 17.8% higher than the five-year average and about 30.1% above the same week a year ago. Prolonged lockdowns to curb the spread of the coronavirus have kept many businesses shut, cutting U.S. LNG exports by half since the start of the year, with stockpiles filling fast and expected to reach a record 4.1 trillion cubic feet by the end of October. “Futures are still below $2 because the LNG exports have dropped drastically due to the pandemic and a recovering crude oil price have ramped up production,” Saal added.

Colonial Pipeline to Enter the Terminal Business -- Colonial Pipeline Co. reported Wednesday that it plans to expand into the terminal business by acquiring three refined products terminals in the Southeastern U.S. In a written statement emailed to Rigzone, Colonial stated that Colonial Terminals Operating Co. LLC – a unit of affiliate company Colonial Enterprises, Inc. – has entered into an agreement to purchase terminals in Charlotte, N.C., Chattanooga, Tenn., and Fredericksburg, Va., from Lincoln Terminal Co., Inc. According to Lincoln’s website, the three terminals boast 525,000 barrels of tank capacity. Colonial pointed out the Charlotte and Chattanooga terminals are linked to the Colonial Pipeline system. The system spans more than 5,500 miles (8,851 kilometers), linking Gulf Coast refineries to markets throughout the Eastern U.S. Colonial stated the acquisition offers the company an “excellent opportunity” to enter the terminal business. It contends the move will allow it to offer a complementary service to the markets, including Colonial Pipeline customers. Moreover, it stated the company is laying the groundwork for further strategic expansion. “Terminals are a natural extension of Colonial’s overall business, providing the opportunity to serve customers in new ways while building and strengthening relationships,” the firm stated.

‘Kafkaesque’ FERC Pipeline Process Needs Revamp, Court Says -Federal regulators can’t dawdle on pipeline appeals and keep challengers out of court in the process, the D.C. Circuit ruled Tuesday in a landmark decision for energy law. The Federal Energy Regulatory Commission violated the law by routinely issuing “tolling orders” that prevent pipeline opponents from seeking judicial review while an agency petition process drags on and industrial development moves forward, the court said. The ruling is a major victory for landowners, environmentalists, and other pipeline critics who can now get to court faster to challenge projects, and may have a better shot at blocking construction. “Now, the government must stop allowing construction of pipelines while keeping the courthouse doors closed to those who are directly affected by them,” Kelly Martin, head of the Sierra Club’s Beyond Dirty Fuels Campaign, said in a statement. FERC’s tolling order practice effectively rewrote federal law to say “it can take as much time as it wants; and until it chooses to act, the applicant is trapped, unable to obtain judicial review,” Judge Patricia A. Millett wrote for the court. “But the Commission has no authority to erase and replace the statutorily prescribed jurisdictional consequences of its inaction,” she concluded. The full slate of 11 active judges on the U.S. Court of Appeals for the District of Columbia Circuit decided the case. The court agreed to review the case en banc after Millett in 2019 called FERC’s review process “Kafkaesque.” Avoiding Court The D.C. Circuit’s ruling still allows FERC to take extra time to consider whether a contested pipeline approval was proper. But the commission can no longer use tolling orders to avoid judicial review in the meantime. That means the agency must streamline its internal review process, or be equipped to defend against legal challenges earlier in the process. Pipeline opponents, meanwhile, can sue FERC and attempt to block construction before it begins—an option that was often impossible before.

Enbridge: Boat anchor, wire cable may have caused Line 5 damage ⋆ Embattled Canadian oil company Enbridge has still not been able to determine how an anchor support holding up the east segment of the Line 5 pipeline was damaged, according to court documents submitted to the Ingham County Circuit Court Monday.Enbridge does, however, raise the possibility that a boat anchor caused the damage to the east segment of the dual underwater pipeline. The reply brief also states that an “area of interest” on the west segment of Line 5 could have resulted from a wire cable dragged by a boat.The documents were submitted ahead of oral arguments in Nessel v Enbridge, which are scheduled for 1:30 p.m. Tuesday and will address Attorney General Dana Nessel’s request for a preliminary injunction. On Thursday, Judge James Jamo granted Nessel’s request for a temporary restraining order on Line 5’s operation. Enbridge agreed that day to completely shut down the pipeline until a determination is made in court. “While Enbridge has not yet reached a final conclusion, there is visible evidence that the area on the West Line resulted from a vessel dragging a relatively thin item such as a wire cable in a direction perpendicular to the Line,” Enbridge’s reply brief reads. “…In contrast, the damage to the East Line anchor assembly and markings on the lake bed near the damaged anchor assembly are more consistent with damage caused by a vessel of modest size dragging an object parallel to the Line.” The company’s attorneys argue that neither incident put the pipelines in immediate danger and Enbridge is taking steps to prevent further damage. In Tuesday’s filings, Enbridge attorneys argue that Nessel has neither factual nor legal basis for requesting the “extraordinary injunctive relief” that she seeks. They also contend that because federal regulators at the Pipeline and Hazardous Materials Safety Administration (PHMSA) already gave the OK for Enbridge to restart the west line of Line 5, Jamo should lift the restraining order so as to not violate federal law.

Public hearing to be held on Enbridge Energy's proposed line relocation – In response to widespread interest in the upcoming public hearing on Enbridge Energy’s proposed relocation of the Line 5 pipeline in Ashland, Bayfield, and Iron counties, the Wisconsin Department of Natural Resources is hosting a virtual public hearing on Wednesday, July 1.The public can watch the hearing live beginning at 4 p.m. After the hearing is over, the same Media Site link will take people to an online recording of the hearing.Members of the public who wish to provide oral testimony during the hearing will be able to do so using the Zoom Remote Conferencing Platform, which is accessible by computer or phone. Information on how to register to participate via Zoom is available on the DNR’s Enbridge Pipeline Projects web page.The DNR is asking people who want to watch the hearing but do not wish to provide oral testimony to use Media Site instead. That will help ensure that people who wish to testify at the hearing will be able to do so.The hearing will cover Enbridge’s application for a waterway and wetland permit, as well as the scope of the Environmental Impact Statement that will be prepared for the overall project. As proposed, the project would involve construction of 42 miles of new 30-inch pipeline needed to relocate the existing Line 5 pipeline outside of tribal lands of the Bad River Band of Lake Superior Chippewa.Members of the public can submit written comments on the waterway and wetland permit application and the scope of the EIS by email, to DNROEEACOMMENTS@WI.GOV, or by U.S. mail to “Line 5 Comments, DNR (EA/7),” 101 South Webster Street, Madison, WI 53707. All electronic and hardcopy comments must be submitted or postmarked by no later than Saturday, July 11.More information on the proposed project, permit application, and to review a draft outline of the Environmental Impact Statement is available here.

Regulators deny quick approval of new Great Lakes pipeline (AP) — A Michigan regulatory panel on Tuesday refused to grant quick permission to run a new oil pipeline beneath a channel that connects two of the Great Lakes, deciding instead to conduct a full review. The state Public Service Commission's decision involved a proposed replacement for a segment of Enbridge's Line 5 that extends beneath the Straits of Mackinac, which links Lakes Huron and Michigan. The Canadian energy transport company wants to replace dual pipelines that rest on the lake floor with a new pipe that would be placed in a 4-mile-long (6.4-kilometer-long) tunnel to be drilled in bedrock beneath the waterway. Also Tuesday, a state judge heard arguments on whether to extend an order he issued June 25 to shut down the existing underwater segment after damage was discovered on a support piece at the lake bottom. Circuit Judge James Jamo promised to move quickly but made no immediate ruling. That means Line 5 — which carries 23 million gallons of crude oil and natural gas liquids daily between Superior, Wisconsin, and Sarnia, Ontario — will remain closed for now. The 645-mile-long (1,038-kilometer-long) pipeline supplies refineries in Michigan, Ohio and Pennsylvania, as well as the Canadian provinces of Ontario and Quebec. Enbridge said halting its flow even temporarily threatens fuel supplies in those areas, while the state of Michigan and environmental groups contend a major spill would do considerably worse economic damage. “There is a serious risk of harm ... to many communities that potentially endangers the livelihood of many people and businesses as well as the natural resources,” Robert Reichel, representing state Attorney General Dana Nessel's office, said during the online court hearing. Enbridge filed an application in April with the Public Service Commission to relocate the underwater section of Line 5 into the proposed tunnel. The company asked the commission to approve the plan immediately, arguing that the agency in effect had already given permission by allowing the original Line 5 in 1953. But during an online meeting, the panel disagreed on a 3-0 vote. Members concluded that the proposed tunnel pipe “differs substantially” from the twin pipes that were laid 67 years ago, requiring a new easement and a 99-year lease of public trust property.

Michigan regulator: Enbridge needs permission to move Line 5 into tunnel - The Michigan Public Service Commission will not give Enbridge Energy carte blanche to relocate the Line 5 pipeline inside a tunnel beneath the Straits of Mackinac, it ruled Tuesday. The decision triggers a lengthy administrative process to evaluate Enbridge’s plan to relocate the lakebottom petroleum pipeline inside an underground tunnel; a process Line 5 opponents hope will be a key forum for public scrutiny over the pipeline’s future.Enbridge had asked the commission, Michigan’s energy regulator, to rule that it doesn’t need the state’s permission to relocate Line 5 inside the planned tunnel. The company argued that the commission’s 1953 approval of the existing dual-span lakebottom line also covers its plan to replace that section with a 30-inch diameter pipeline running through a concrete-lined tunnel deep beneath the lakebed. The company already has the state’s initial approval to build the tunnel, but it now needs the commission’s approval to move the pipeline into it.  The commission rejected the company’s argument and refused to grant its approval Tuesday, opting instead to forward the matter as a so-called “contested case,” allowing Enbridge and the public to debate the matter before an administrative law judge. Ultimately, commissioners will decide whether to grant Enbridge’s relocation request. The deliberations will test the loyalties of a commission whose political makeup has changed significantly since Democratic Gov. Gretchen Whitmer took office last year, replacing two former appointees of GOP predecessor Rick Snyder, Republican Norm Saari and Independent Rachel Eubanks, with Democrats Dan Scripps and Tremaine Phillips to create a 2-1 Democratic majority, with the third member, Chair Sally Talberg, being an independent. As the commission deliberates on the pipeline, Enbridge is moving forward with the tunnel plan. The company is awaiting state and federal permits with the goal of beginning construction on the tunnel next year. Multiple parties, including Native American tribal governments and environmental groups who have advocated for the pipeline’s shutdown, have filed motions to intervene in the proceedings. They have long called for the 67-year-old pipeline’s shutdown, arguing it poses an unacceptable oil spill risk in the Straits, where it sits exposed on the lakebottom as it pumps crude oil and natural gas between Ontario and Wisconsin.

Enbridge to court: State can't override feds' regulation of Line 5. - Michigan can't order the Line 5 oil and gas pipelines on the Straits of Mackinac lake bottom shut down even temporarily over concerns about anchor strikes or other damage — only federal regulators of interstate pipelines have that authority, Enbridge's attorneys argued in an online court hearing Tuesday.  The company is fighting a preliminary injunction sought by state Attorney General Dana Nessel, seeking to keep Line 5 shut down until Enbridge provides the state with all information related to "significant damage" found June 18 to an anchor support on the east leg of the twin underwater pipelines, and a mark from some object apparently striking the west leg of the line, potentially affecting its outer protective coating.The state wants its own evaluators to determine whether it is safe to continue operations of either or both of the pipelines. Nessel's office cites the state's 1953 easement with Enbridge allowing it to place and operate the pipes on the state-held lake bottom. A provision in that easement requires the pipeline operator "at all times shall exercise the due care of a reasonably prudent person for the safety and welfare of all persons and all public and private property."Ingham County Circuit Court Judge James Jamo last Thursday ordered Enbridge to shut down Line 5 in the Straits, pending the outcome of Tuesday's hearing on a temporary injunction. After more than four hours of testimony Tuesday, Jamo said he would consider the evidence and issue a written ruling, likely within the next few days."Underlying this case, and relevant to this motion, there is a serious risk of harm, not only to natural resources, but to many communities — that endangers, or potentially endangers, the livelihood of many people and businesses," assistant state attorney general Robert Reichel said.Though Enbridge last week provided state officials with engineering reports and video from its remote-operated vehicles inspecting the underwater pipes, critical information is still not available to the state to evaluate whether the pipelines should continue operating, Reichel said. Enbridge now believes that the damage was done to the individual underwater lines by two separate boats in separate incidents —  one ship traveling east-west through the Straits, dragging something other than an anchor, perhaps a cable, based on drag marks and the glancing loss of outer biological coverings on the west leg pipeline, and the other ship traveling north-south through the Straits, parallel to Line 5, that caused the damage to the east leg anchor support.

Enbridge's Damaged Line 5 Allowed to Restart by Michigan Judge - Enbridge Inc. can partially restart its dual oil and gas pipeline below Lakes Michigan and Huron, even though one leg of the line remains closed due to damage, a state court ruled Wednesday. The Canadian energy titan convinced Ingham County Circuit Court Judge James Jamo to deny a preliminary injunction to Michigan Attorney General Dana Nessel. The judge issued an amended temporary restraining order requiring Enbridge to provide information to the state’s attorneys and keep the eastern leg of the pipeline closed. Federal regulators gave Enbridge the green light to reopen the western leg of the pipeline, which the company said it plans to start doing immediately. Jamo concluded the risk of rupture in Line 5’s undamaged western section was remote enough that the company should be allowed to operate that portion while investigating damage in the line’s eastern leg. The order saves Enbridge roughly $1.76 million per day, which it says it lost while the line was shut down. Jamo seemed to accept arguments from Enbridge’s attorneys that the pipeline’s west leg must be restarted in order to perform an in-pipeline assessment of the damage discovered on June 18. Jamo said the company’s duty of “due care” required it to restart the western leg so an “in-line-investigation” of the pipeline could be completed and technical data could be shared with state and federal regulators. Enbridge will begin restarting the west segment and anticipates “operations will soon return to normal,” company spokesman Ryan Duffy said in an email. Enbridge doesn’t know what caused the damage to the underwater pipe, but the firm’s initial findings indicate a boat may have dragged a fishing line across the western pipe, and a boat’s anchor may have struck a support for the eastern pipe. The court ordered the eastern leg to remain closed until the Pipeline Hazardous Materials Safety Administration investigates the damage and Enbridge completes all repairs the federal regulator recommends.

Frac sand producer Covia files for bankruptcy; $1B cost reduction plan proposed  - other Wisconsin sand mine operator is facing bankruptcy as the COVID-19 pandemic and falling oil prices continue to shake the industry. Covia, which owns permitted mines and plants in Columbia, Dunn, Monroe, Pierce and Waupaca counties, filed for Chapter 11 bankruptcy Monday, saying a restructuring plan negotiated with lenders will eliminate more than $1 billion in fixed costs. The Ohio-based company said it has more than $250 million cash on hand that will allow the company to continue operation during the proceedings. CEO Richard Navarre said the bankruptcy was brought on by a combination of the COVID-19 pandemic and “recent energy price shocks” that significantly affected Covia’s customers, which include oil and gas producers who use sand to prop open cracks in underground rock formations. Along with the pandemic, which has triggered a global recession, oil prices plunged in March when the 13-member Organization of Petroleum Exporting Countries. According to court filings, this came on the heels of two difficult years for producers of the high-quality Northern White sand found in Wisconsin: starting in late 2018, the companies that drill for oil and gas scaled back operations when lenders pulled back; at the same time, the supply of sand essentially doubled as producers opened dozens of new mines, and producers turned to cheaper, lower-quality sand mined closer to oil fields.

A Texas-based oil and gas company files for bankruptcy (AP) — Texas oil and gas company Sable Permian Resources has recently filed for bankruptcy. Sable Permian Resources filed for Chapter 11 bankruptcy protection last week in federal bankruptcy court in Houston, according to a news release. Permian Resources was once part of American Energy Partners, a company founded by Aubrey McClendon in 2013, The Oklahoman reported Tuesday. American Energy announced it would close in 2016, splitting up operations into separate companies, including Permian Resources. In 2017, it became Sable after the company reached a $1 billion deal with creditors to continue operating. The company and its affiliates said the bankruptcy filing will allow them to position the companies for long-term success. If first day motions are approved, the companies would be able to to continue operations. They arranged $150 million for that. Chesapeake Energy, which McClendon also founded, filed for bankruptcy this week.

 Houston-based Sanchez Energy emerges from bankruptcy under new name -  Houston oil company Sanchez Energy has exited from Chapter 11 bankruptcy with a new CEO and as a privately held company under new leadership and the name Mesquite Energy.Once among the largest drillers of the Eagle Ford Shale of South Texas, bankruptcy proceedings allowed the company to shed $2.3 billion of debt. The company's founding CEO Tony Sanchez is leaving the company while chief financial officer Cameron George has been named as interim CEO.“We are excited to begin our new chapter as Mesquite Energy, a simpler and leaner company, guided by our core principles of cost discipline and production efficiency to create long-term value for our stakeholders,” George said. Saddled by debt and high interest payments, the company filed for Chapter 11 in August 2019 and emerged with new leadership.Nathan Van Duzer with Fidelity Investments, Wilson Handler with Apollo Global Management and oil industry veteran Harry Quarls have been named to the reorganized company's board of directors.The company's general counsel Gregory Kopel will remain at Mesquite as executive vice president, general counsel and corporate secretary.“With a clean balance sheet and substantial repositioning of our cost structure, we have taken the hard but necessary steps to become profitable in this low commodity price environment," George said.

Some Populated Texas Areas Are At Risk Of Hydrogen Sulfide Pollution According To New Report  - The oil and gas industry has become more active in the Permian Basin in recent years, and west Texas residents have complained of noxious smells and increased air pollution. In response, The Texas Commission on Environmental Quality launched two air monitoring surveys in December and February, and the results are now public. The survey teams spent 10 total days in Midland, Odessa, Goldsmith, Seminole and Denver City over December and February. They focused on publicly accessible and populated areas near industrial sites. The surveys measured air pollutants, like sulfur dioxide, and the more poisonous gas, hydrogen sulfide. The legal limit of hydrogen sulfide in Texas is 80 parts per billion over a 30-minute average. That limit was exceeded in several different places on multiple days — in the worst instance, by 500% when the 30-minute average was 400 parts per billion. That level of the gas isn’t enough to cause immediate, serious health concerns, but it can do damage in the long term, says Afamia Elnakat, a doctor of environmental toxicology at University of Texas San Antonio. "Well, in terms of long-term exposure, we look at it the same way we look at either respiratory irritant or long term. And that is basically as much as people will be impacted, you become less tolerant to other irritants," said Elnakat. She added the levels of hydrogen sulfide documented in the survey would likely affect the most sensitive groups only. (embedded study: Permian Basin Survey: Lubbock and Midland)

Exxon Reports Roof Problem, Spill at Beaumont, Texas, Refinery - Exxon Mobil Corp. said a storage-tank's floating roof gave way Friday at its Beaumont, Texas, refinery, causing thousands of pounds of chemicals to spill out."A roof on a floating roof failed," the 362,000-barrel-a-day refinery said in a filing Friday night to the Texas Commission on Environmental Quality. "The material is being pumped into another tank. Vacuum trucks have been deployed to recover spilled material."Exxon said it expected to finish cleaning up on Sunday. The spill included some 8,000 pounds of benzene, more than 2,000 pounds of ethylbenzene and other chemicals. This is at least the third storage tank roof problem Exxon has reported at its Texas refineries in the past year. Valero Energy Corp. also reported roof problems at its 293,000-barrel-a-day Corpus Christi, Texas, refinery earlier this month, saying a floating roof sank and caused spillage.

Demand for oil is dry, but this bill may keep money going to energy companies  — Texas and Oklahoma Republican Senators John Cornyn and Jim Inhofe are trying to shore up the oil industry and oil jobs in their states. As the pandemic has all but dried-up demand for oil, the senators have introduced a bill that would keep the money flowing to energy companies and keep oil and gas workers on the payroll. Texas provides about 40% of the nation’s oil and gas. Cornyn says all that oil is good for jobs, but when oil prices plummet it means “a lot of people are getting laid off jobs.” Cornyn and Inhofe’s bill, the “Save Jobs Act” would provide tax and regulatory relief for US energy companies hit hard by the pandemic. “Be ready when the economy starts to rebound, as we are already starting to see, that they will have those people in place so they can hopefully get back to business as soon as possible,” Cornyn said. “We are looking to provide additional liquidity and sort of a lifeline to help.” Inhofe says one in five jobs in his home state are directly tied to the energy industry. “I think we will all benefit from that, certainly Oklahoma will,” Inhofe said. “The companies have to keep going. We have to keep producing oil and gas.” Inhofe says the bill is only a short-term fix, but would incentivize companies who are tight on money to keep drilling.

Baker Hughes Rig Count Shows US Decrease - Baker Hughes Co. reported Thursday that the U.S. rotary rig count decreased by two drilling units this week. Based on the latest figure, 263 rigs were operating in the U.S. The number comprises 185 oil rigs, 76 gas rigs and two miscellaneous rigs. The number of oil rigs decreased by three week-on-week and the number of gas rigs increased by one during the period, Baker Hughes noted in a written statement emailed to Rigzone. The latest U.S. rig count represents a 700-rig decrease from the 963-rig figure a year ago, Baker Hughes added. The firm pointed out that, year-on-year, the number of oil rigs is down 603, gas rigs down 98 and miscellaneous rigs up by one. It also stated the U.S. offshore rig count is up one this week to 12 but down by 12 units compared to the same period in 2019. In Canada, the number of rigs jumped by five this week to 18, Baker Hughes noted. It pointed out the oil rig count increased by two to six units during the period and the gas rigs figure rose by three to 12. Canada’s 18-rig total for the week represents a 102-rig decrease from the year-ago level, Baker Hughes stated. Against the corresponding period in 2019, Canada’s oil rig and gas rig counts are down by 74 and 28 drilling units, respectively.

 ConocoPhillips to Ramp Up Oil Production-- ConocoPhillips said it will begin restoring curtailed oil production in July as crude prices rebound from their lockdown depths. The company will bring back output in Alaska and other states next month, with Canadian production coming back in the third quarter. “Given ongoing variability and uncertainty in the outlook for production curtailments, the company will continue to suspend forward-looking guidance and sensitivities,” Conoco said in a statement Tuesday. Conoco is the latest oil driller to turn on the taps after a pandemic-fueled collapse in crude prices spurred an unprecedented halt to significant portions of output. Earlier this month, Continental Resources Inc. said it would bring back a portion of its curtailed production in July, joining the ranks of restorationists that include Parsley Energy Inc. and EOG Resources Inc. West Texas Intermediate crude futures have more than doubled in the past two months and were hovering around $39 a barrel on Tuesday. In late April, they plunged into negative territory for the first time in history. Conoco said it will pump the equivalent of 960,000 to 980,000 barrels a day during the quarter that ends on Tuesday, excluding Libyan output, down from 1.3 million barrels during the first quarter.

New polling shows dramatically low levels of support for drilling in the Arctic National Wildlife Refuge - Alaska Native News  - Recent attempts by the Trump administration to allow drilling in the Arctic National Wildlife Refuge and to bail out oil companies during the COVID-19 pandemic with taxpayer money, as well as its criticism of banks’ decisions not to fund Arctic oil and gas development, are hugely unpopular with American voters.According to newly completed public opinion research, drilling in the Arctic Refuge is incredibly unpopular across the political spectrum. Moreover, the notion of the federal government helping oil companies with taxpayer dollars and special allowances to exploit public lands for private profits is not popular with most Americans. And the recent movement by banks like Wells Fargo, Goldman Sachs and Morgan Stanley to commit to not funding drilling in the Arctic Refuge is supported by a broad swath of people.Climate Nexus Polling, in partnership with the Yale Program on Climate Change Communicationand the George Mason University Center for Climate Change Communication, conducted a nationally representative survey of 2,119 registered voters in the United States June 6-8, 2020. You can find the national poll crosstabs here and the toplines here.Only 1 in 5 think the Trump administration should open the Arctic Refuge for drilling by oil companies.An abysmal 22% of voters think the Trump administration should open the Arctic National Wildlife Refuge for drilling by oil companies — almost three times as many (61%) oppose this action. Only 19% of Independents and 17% of female respondents support the Trump administration’s efforts here, and even among Republicans 46% oppose oil drilling in the Arctic Refuge versus 35% that support Trump’s push. Voters, including large majorities of Republicans and Independents, overwhelmingly support banking policies that reject funding for Arctic oil and gas, including in the Arctic Refuge.

US oil, gas rig count falls 6 to 285 as industry begins to stabilize— After consecutive weeks of single-digit declines, the US oil and gas rig count may have essentially reached its long-awaited bottom. The US oil and gas rig count fell by six to 285 for the week ending July 1, Enverus data shows, following a one-rig decline the week prior. Upstream operators shed four oil rigs week on week, leaving 191, and lost two gas rigs, leaving 94. From here on, some "minor" fluctuations in rig counts may occur, what analysts call "noise," but large weekly changes are not expected, said analyst Matt Andre of S&P Global Platts Analytics. "We're going to see some slight up-and-down movements, but we're really close to a bottom," Andre said. "Oil is $40/b, and ConocoPhillips is talking about increasing oil production." Based on its economic criteria, ConocoPhillips said June 30 it expects in July to begin restoring some of the 225,000 boe/d of production it curtailed during the second quarter. Restored volumes will be both in the Lower 48 and Alaska. Five of the eight largest US basins showed no weekly change in rig counts, and four of those basins—the Bakken Shale in North Dakota/Montana, the SCOOP/STACK in Oklahoma, the Utica Shale mostly in Ohio and the DJ Basin in Colorado—now have 10 active rigs or less. Years ago, the Bakken and the Eagle Ford in South Texas each had over 200 rigs running. On July 1, the Bakken had 10 rigs, unchanged on the week, while the Eagle Ford had nine rigs after losing two rigs from the previous week. The Permian Basin of West Texas/New Mexico, which boasted a rig count over 400 in January, is down to 140, with one rig shed from the previous week. "The horrendous second-quarter 2020 is finally behind us, with total drilling activity finishing [at] record-low levels," investment bank Tudor Pickering Holt said in a June 29 investor note. The rig count averaged 411 in the second quarter, down 50% from 828 during Q1, according to Enverus data. "For reference, the worst quarterly decline during the 2015-16 downturn was around 35%," Tudor Pickering Holt said. By comparison, Q2 2020's sequential decline of 50% highlights "the sheer speed of the recent rig count fall-off." Investment bank B. Riley FBR estimated the number of well completions decreased 36% in May over the prior month to 441. The recent peak was 781 in November 2016, it said.

Canadian exporter sentenced in US for breaching Iran embargo by secretly exporting oil and gas equipment  - A Toronto export manager for a Mississauga company has been sentenced to prison in the United States for illegally exporting gas turbine engine parts to Iran, in violation of long-standing U.S. embargo and trade sanctions. Angelica O. Preti, 45, of Toronto, was sentenced to 18 months in prison in Columbus, Ohio, on Friday, according to the U.S. Attorney’s office in the Southern District of Ohio. Few details, however, are available — including details of the allegations against her or the date she was arrested — as the case is sealed by the court and remains “sensitive,” according to a Justice Department official. “Preti made a calculated decision to harm the United States by supplying enemies abroad,” U.S. Attorney David DeVillers said in a written statement. “Preti also attempted to cover up her crimes by directing the filing of false electronic export information, and attesting that the final destination of goods was not Iran. Preti also employed a number of additional methods to obscure the fact that Iran was the end-user for the shipments,” DeVillers said. U.S. authorities said that during Preti’s time as export operations manager at UE Canada Inc., the freight company was involved with 47 shipments exported from the U.S. Of those shipments, 23 were traced as destined for Iran. UE Canada is based in Mississauga, 5 kilometres west of Toronto Pearson Airport.

Shell to cut asset values by up to $22 billion after coronavirus hit - (Reuters) - Royal Dutch Shell plans to slash the value of its oil and gas assets by up to $22 billion after the coronavirus crisis hit demand for fuel and weakened the outlook for energy prices, the Anglo-Dutch energy company said on Tuesday. The writedown announcement came after Shell cut its forecast for energy prices into 2023 on expectations that sales will only recover slowly after the pandemic, adding to the company’s already bleak longer-term outlook for fossil fuel demand. Shell’s move follows similar steps by other major energy companies such as BP (BP.L), which plans to cut the value of its assets by up to $17.5 billion following the hit to fuel sales from global travel restrictions to prevent the virus spreading. Shell, which has a market value of $126.5 billion, said in an update ahead of second-quarter results due on July 30 that it would take an aggregate post-tax charge of $15 billion to $22 billion because of the writedowns. The charges relate to large liquefied natural gas (LNG)operations in Australia, including the Prelude floating LNG facility, the world’s biggest, as well as oil and gas production assets in Brazil and U.S. shale basins.

 BP to Raise $5B via Petchems Business Sale - BP plc reported Monday that it has agreed to sell its global petrochemicals business to INEOS for a total consideration of $5 billion, subject to adjustments. The deal, which includes BP’s global aromatics, acetyls and related businesses, will enable the company to achieve its $15 billion divestment target a year ahead of schedule, BP noted in a written statement emailed to Rigzone. “Today’s agreement is another deliberate step in building a BP that can compete and succeed through the energy transition,” remarked BP CEO Bernard Looney. Under the agreement, INEOS will pay BP a $400 million deposit and subsequently pay $3.6 billion on completion, BP stated. The company added the remaining $1 billion will be deferred and paid in installments: “I recognize this decision will come as a surprise and we will do our best to minimize uncertainty. I am confident however that the businesses will thrive as part of INEOS, a global leader in petrochemicals.” stated Looney. From a strategic standpoint, limited overlap exists between BP’s petrochemicals business and the rest of BP, Looney continued. “(I)t would take considerable capital for us to grow these businesses,” he commented. “As we work to build a more focused, more integrated BP, we have other opportunities that are more aligned with our future direction. Today’s agreement is another deliberate step in building a BP that can compete and succeed through the energy transition.”

1H Discoveries at Lowest Point in 21st Century - Global discoveries of conventional resource volumes (CRV) dwindled in the first half (1H) of this year, according to Rystad Energy. The company estimates that CRV discoveries stood at 4.9 billion barrels of oil equivalent (boe) in 1H 2020, which is the weakest performing first half of the 21st century, Rystad highlights. Resource volumes were said to be 42 percent lower and discovery numbers were down 31 percent compared to the same period in 2019, Rystad revealed. Rystad estimates that the average monthly discovered volumes so far this year stand at 810 million boe, which marks a 34 percent drop from the same period last year, according to the company. The monthly average was pulled down primarily by June, which only saw three small onshore discoveries, Rystad noted. January and May were said to be the most successful months in 1H due to “significant” discoveries such as Jebel Ali in the United Arab Emirates, Maka Central in Suriname, Uaru in Guyana and 75 Let Pobedy in Russia. Russia, South America and the Middle East account for about 73 percent of the total discovered resources so far in 2020, according to Rystad, which revealed that the period saw a total of 49 conventional oil and gas discoveries. Of these, 27 were said to have been announced during the global lockdown and travel restriction period. “Last year we saw the highest volumes of discovered resources since the last downturn,” Rystad Energy’s upstream analyst Taiyab Zain Shariff said in a company statement sent to Rigzone. “Based on the large number of high-impact exploration wells planned for this year, 2020 was meant to follow the same path. But then Covid-19 struck and the oil market crashed in 1Q20, resulting in delays and cancellations as operators cut budgets,” Shariff added in the statement.

Analysts Expect Refinery Closures-- The global refining industry is entering a consolidation phase as slowing oil demand growth is set to coincide with large-scale projects that will start coming online next year, according to Goldman Sachs Group Inc. The demand hit from the coronavirus is yet to cause any delays in a number of mega-refining projects, most of which are in China and the Middle East, that will start operations from 2021 to 2024, the bank said in a note. This will cause global utilization rates to be 3% lower over this period than in 2019. “We expect competition to intensify leading to below consensus -- and mid-cycle -- refining margins over 2021-22 and potential refinery closures in developed markets,” analysts including Nikhil Bhandari said in the note. Global oil demand will return to pre-virus levels by 2022, they said. Emerging markets will provide the bulk of oil consumption growth in the first half of this decade and the new mega-refineries will be located close to where the demand is, according to Goldman. This means refinery closures will be more likely in developed nations. Among oil products, gasoline will lead the recovery in fuel demand, the lender said. The outlook for distillates is more challenging as jet fuel’s recovery will be slower and diesel consumption will be hit by the uptake of electric vehicles in the medium term. In addition, the new mega-refineries are distillates heavy. Gasoline and diesel consumption will return to 2019 levels by next year, while jet fuel is unlikely to get there until at least 2023, the analysts said. Liquefied petroleum gas and naphtha will be key long-term growth drivers on the back of growing petrochemical consumption, while overall oil demand won’t peak before 2030, they said.

Petrol sold to Nigeria from Europe ‘dirtier’ than black market ‘bush’ fuel - Black market fuel made from stolen oil in rudimentary “bush” refineries hidden deep in the creeks and swamps of the Niger delta is less polluting than the highly toxic diesel and petrol that Europe exports to Nigeria, new laboratory analysis has found. Shell, Exxon, Chevron and other major oil companies extract and export up to 2m barrels a day of high quality, low sulphur “Bonny Light” crude from the Niger delta. But very little of this oil is refined in the country because its four state-owned refineries are dysfunctional or have closed. Instead, international dealers export to Nigeria around 900,000 tonnes a year of low-grade, “dirty” fuel, made in Dutch, Belgian and other European refineries, and hundreds of small-scale artisanal refineries produce large quantities of illegal fuel from oil stolen from the network of oil pipelines that criss-cross the Niger delta. The net result, says international resource watchdog group Stakeholder Democracy Network (SDN) in a new report, is that Nigeria has some of the worst air pollution in the world, with dense clouds of choking soot hanging over gridlocked cities leading to a rise in serious health conditions as well as damaged vehicles. The extreme toxicity of the “official” fuel exported from Europe surprised researchers who took samples of diesel sold in government-licensed filling stations in Port Harcourt and Lagos. They found that on average the fuel exceeded EU pollution limits by as much as 204 times, and by 43 times the level for gasoline. Laboratory analysis also showed that the black market fuel was highly polluting but of a higher quality than the imported diesel and gasoline. The average “unofficial” diesel tested exceeded the level of EU sulphur standards 152 times, and 40 times the level for gasoline.

Nigeria Bucks LNG Export Trend-- Nigeria plans to keep its liquefied natural gas supply at current levels despite prices near record lows, the opposite of what exporters from the U.S. to Australia are doing. State-owned Nigeria LNG Ltd. plans to continue utilization levels and may even boost exports in August and September depending on demand, according to a person with knowledge of the strategy. The country exported over 1.8 million tons last month, higher than last year’s monthly average of 1.7 million, according to ship-tracking data compiled by Bloomberg. A spokesperson for Nigeria LNG didn’t immediately comment on the plans. Most of the world’s suppliers curbed deliveries in June as measures to contain coronavirus slashed gas consumption, with global exports down 6.3% from the previous year. Only a handful of exporting countries, including Qatar and Algeria, have been able to boost output. Some of Nigeria’s buyers have exercised clauses in their long-term contracts, that allow them to take fewer shipments than originally agreed. The firm has been able to sell that excess supply into the spot market, but usually at a discount. More than half of Nigeria’s exports in May ended up in Asia, compared with less than a third last year, according to ship-tracking data. Production costs at Nigeria’s Bonny Island facility are so low that it can still turn a profit amid weak spot prices, said the person who asked not to be identified because the plans are private. The facility has among the lowest costs in the world, according to data from Sanford C. Bernstein & Co.

Three-kilometre oil spill reported on Sharjah beach - An oil slick was reported along the coast of Khor Fakkan in Sharjah on Monday. The spill washed up over a three-kilometre stretch between Luluyah and Zubara public beaches. The environmental hazard was reported to Khor Fakkan Municipality, which assembled a team including members from Beeah, an environmental management company, to clean up the beach. “We received a report about the oil spill and a team of 50 people will be working on cleaning up both Luluyah and Zubara beaches,” said Fawzia Al Qadi, director of the municipality. Ms Al Qadi said that the clean-up process began Monday and is expected to be completed by Tuesday. “We don’t know the reason behind it, but there is a high possibility that the oil was dumped by tankers into the water,” she said. Ms Al Qadi said it was is not the first time oil has washed up onshore on the east coast with the most recent incident occurring five months ago. A resident of the area, who shared a video of the spill online said he noticed trails of black sludge enveloping the sand at Luluyah beach.“I noticed the oil on the sand at 7am and the smell in the area was bad similar to the fuel smell,” said Khaled Al Rayssi, who runs a Khor Fakkan news Instagram account. “The colour of the water near the shore was dark and the oil was coming out of the water and settling on the sand,” he said. Oil spills on the east coast happen several times a year. Last March, campers shared videos of Al Aqah coastline in Fujairah covered with black oil that washed ashore. The oil covered around 1.5 kilometres of the beach and reached some of the hotels next to the public beach camping site.

Nearly 48,000 liters of oil spill into Iloilo City waters after power barge explosion - — Around 48,000 liters of oil spilled into waters off Iloilo City on Friday after an explosion at a power barge, local officials said. Authorities estimated an area of 1,200 square meters was affected by the spillage. The Coast Guard also pegged that about 40,000 liters were spilled. "Current efforts involve scooping and skimming of spilt oil in order to contain the spill led by the [Philippine Coast Guard]," said the city's city's emergency operation center. The explosion took place at 2:24 p.m. at AC Energy's Power Barge 102 in Lapuz district's Barrio Obrero, officials reported. The fire was declared out by 3 p.m. The barge's estimated capacity is 200,000 liters. AC Energy said it is investigating the cause of the explosion. It added that the oil spill was initially blocked by a structure surrounding the barge but high waves caused it to spill out. "We will do the needed cleanup once we are confident that we have done a good job containing the oil in the area," the company said in a statement. "We target completion of containment tonight, to be followed by skimming activities tomorrow."

Asian gasoil margins improve as lockdowns ease, but challenges remain -  (Reuters) - Asian refiners’ profits from gasoil have more than trebled from a record low seen in early May as demand recovers after sweeping lockdowns imposed to curb the COVID-19 pandemic, although refiners ramping up production after maintenance could cap gains, analysts said.  Refining profits for gasoil with 10 parts per million of sulphur in Singapore were at $6.29 a barrel over Dubai crude on Monday, up from a record low of $1.77 on May 5, Refinitiv data showed. Gasoil spot premiums are hovering near their strongest levels this year, while traders believe that overall refining margins in the region will be supported as the worst is behind for the industrial fuel. “Resumption in industrial activities and an improvement in road freight and transport needs will support a recovery in the third quarter gasoil demand in major economies,” said Sri Paravaikkarasu, director for Asia oil at consultancy FGE. FGE expects gasoil demand in the second half of the year to rise by 600,000 barrels per day (bpd) from the first half, but still be 490,000 bpd lower compared with the same period a year ago. “The region’s gasoil surplus should trend flat q-o-q at around 900,000 bpd in the third quarter and the second half (of 2020) should average at 840,000 bpd, down by 300,000 bpd compared to the first half of the year,”

Russia Benefiting from Oil Market Turmoil - Demand for Russian Urals grade oil is so strong that is has been trading at a pretty steep premium to Brent Crude this month. Southfront references this report from Argus research. This means that the Russian Urals crude is trading at a premium to the European benchmark Brent. The premium is $1.55 per barrel in North-Western Europe and $2.55 – in the Mediterranean. Argus names competition as the reason of Urals reaching such a high price. After the United States imposed sanctions against Venezuelan oil, American refineries began to willingly buy Russian heavy oil, very similar to the one exported by the Venezuelan PDVSA. In addition, demand for Russian oil in Asia is growing.Traditionally, Urals trades at a discount to Brent because of a lack of a unified benchmark price for it. The July Shanghai Crude Oil futures contract closed at ¥299 (or $42.30) per barrel this week, putting it at a ~$1.70 premium to Brent Crude.Russian Urals is far closer to the Medium Sour oil the Shanghai contract represents than the Light Sweet Brent. At the same time the Saudi Arabian plan to flood the market with oil to gain market share has failed entirely.Despite record oil exports in April as Saudi Arabia flooded the market with oil, the value of the Kingdom’s crude exports plunged by US$12 billion from April 2019 levels as the lowest oil prices in years hit revenues.In April, the value of Saudi Arabia’s oil exports plummeted by 65.4%, or US$12 billion (45.3 billion Saudi riyals), severely affecting the value of the total exports of the world’s top oil exporter, data from Saudi Arabia’s General Authority of Statistics showed on Thursday.China was Saudi Arabia’s main trading partner for merchandise trade in April 2020, with Saudi exports to China valued at US$1.9 billion (7.16 billion riyals).The Saudis flooded the market with oil after the collapse of the previous OPEC+ deal in early March, exporting a record 10.237 million barrels per day (bpd) in April 2020, up from 7.391 million bpd in March, according to data from the Joint Organisations Data Initiative (JODI).They shipped out 50% more oil and revenues plunged by 65%. They practically gave the stuff away in April. They had to. With the Riyal tied to the dollar they had to undercut Russian oil which trades in freely-floated rubles.In March and April the ruble spiked to a high of RUB81.66 per dollar and has steadily fallen since then. Today it is still trading around 5% weaker against the U.S. dollar than it was pre-crisis. That then becomes an even bigger source of profit given that now Urals grade is trading at a premium to Brent Crude while U.S. exports continue to lag behind. And the Saudis are now still price takers rather than price makers since they immediately had to go back and adhere to production cuts in like with the rest of OPEC+’s agreement.

Russia Urals Exports Set to Fall Sharply  --Russia’s exports of its flagship Urals crude oil grade are set to plunge next month, underscoring the nation’s commitment to helping OPEC and allied producers to avert a global glut. Exports of the grade from its three main western ports -- Primorsk and Ust-Luga in the Baltic Sea and Novorossiysk in the Black Sea -- will fall 40% month-on-month to about 785,000 barrels a day in July, according to loading plans seen by Bloomberg. The country only began shipping from Ust-Luga in 2012 and flows from the three facilities have never been lower on a combined basis since then.Russia is working with Saudi Arabia and other producing countries to eliminate a surplus. Its output cuts have driven up premiums that Urals command to the highest in years, and tightened the wider physical oil market, albeit at the cost of selling smaller volumes. Financial derivatives in the Urals market rallied after the news. Swaps contracts for July were trading at premiums of between $1.80 and $1.95 to Dated Brent, brokers said. That compares with a discount of about $4.50 at the depths of oil’s rout in early April. The reduced exports had already been foreshadowed by a partial loading program. An export schedule for the first 10 days of July showed flows for the period dropping to 880,000 barrels a day. Primorsk will lead the drop, handling 1.3m tons, or about 307,000 barrels a day, next month. That’s less than a third of what it was shipping a year ago. Ust-Luga will ship 284,000 barrels a day, while flows from Novorossiysk will decline to below 200,000 barrels a day.

Oil steady as rise in virus cases offsets better data - Oil prices steadied on Monday, supported by improving economic data but held in check by sharp spikes in new coronavirus infections around the world that have forced some countries to impose partial lockdowns. Brent crude fell 4 cents, or 0.1%, to $40.98 a barrel and U.S. crude was up 7 cents, or 0.2%, at $38.56. Crude prices found some support as profits at China's industrial firms rose for the first time in six months in May, suggesting the country's economic recovery is gaining traction. The recovery of economic sentiment in the euro zone also intensified in June after a modest pick-up in May, with improvements across all sectors and a much more buoyant sense of future business, European Commission data showed. However, fears of a second wave of the pandemic took the shine off the improving economic data. The United States, India and Brazil are experiencing a resurgence in infections, leading authorities to partially reinstate lockdowns in what experts say could be a recurring pattern in the coming months and into 2021. The death toll from COVID-19 surpassed half a million people on Sunday, according to a Reuters tally. "Looking ahead, anxiety is likely to remain heightened as the epic fight against the coronavirus pandemic continues. This spells bad news for risk assets (such as oil) which will inevitably remain under pressure," said Stephen Brennock of broker PVM. Oil prices were also under pressure from poor refining margins and high inventories, analysts said. Still, Brent is set to end June with a third consecutive monthly gain after major global producers extended an unprecedented 9.7 million barrels per day supply cut agreement into July, while oil demand improved after countries across the globe eased lockdown measures.

Oil Prices Rebound Amid Positive Economic Data -- Oil rebounded from a weekly loss as better-than-estimated economic data countered fears that Covid-19’s resurgence will crimp fuel demand. Futures in New York and London closed higher after declining for two out of the last three weeks. Prices followed equities higher as U.S. pending home sales posted a record gain, signaling that America’s economic recovery is underway. Yet the outlook remains uncertain. “The economic data continues to improve,” Still, the overall market picture is bearish. Crude stockpiles in the U.S. are at record highs, worldwide consumption remains a long way off pre-virus levels and many refiners are struggling with low margins. In another indication that supplies are plentiful, WTI and Brent crude for prompt delivery are trading at discounts to later dated contacts in a market structure known as contango. New clusters of coronavirus infections across the U.S. South and Southwest have states including Texas reversing or slowing reopening plans. Domestic fuel consumption dropped 2.3% Saturday from the same day the week prior. “We have a demand problem,” “I wouldn’t be shocked to see us retest the low $30s.” While American gasoline demand has gradually improved, diesel inventories have expanded for 11 out of the last 12 weeks, suggesting that industrial activity has a long road to recovery. “The product inventory problem may be the most bearish factor out there,” said O’Grady. “If you look at the demand for distillate, it’s terrible, and distillate is what drives the economy,”   Prices:

  • West Texas Intermediate for August delivery rose $1.21 to $39.70 a barrel in New York
  • Brent for the same month, which expires Tuesday, settled 69 cents higher at $41.71. The more active September contract settled at $41.85

Oil Markets On Edge As Second Wave Hits - Oil continues to trade around $40 per barrel. There are offsetting forces at play – continued economic rebound creates upward pressure but fears of accelerating Covid-19 transmission magnifies downside risk. In the oil market, the possibility of new Libyan oil is offset by tighter compliance from OPEC+. Shell said it would write down $22 billion, as it revised down its assumed oil price in the years to come. The writedown included an $8-$9 billion impairment in its integrated gas unit, $4-$6 billion in upstream, and $3-$7 billion in its refining portfolio. The move will increase deb gearing by 3 percent.  Chesapeake Energy is arguably the highest-profile shale driller to succumb to bankruptcy to date. The company will continue to operate six to eight rigs for the next two years, about half of the number of rigs from the first quarter. The bankruptcy will wipe out $7 billion in debt. Chesapeake reported a first quarter loss of $8.3 billion earlier this year.  China, India, the European Union and the United States will join other countries in a “green recovery” summit hosted by the IEA. The agency is pushing the world to undertake green stimulus. “Even if governments do not take climate change as a key priority, they should still implement our sustainable recovery plan just to create jobs and to give economic growth. Renovating buildings, for instance, is a job machine,” the IEA’s Fatih Birol said.  A Reuters survey of 45 analysts finds an average Brent price of $40 per barrel for 2020, with price gains towards the end of 2020 and into 2021.  ExxonMobil is preparing to let go between5% and 10% of its US-based employees subject to performance reviewed, anonymous sources told BNN Bloomberg. The number of active U.S. frack crews, which bottomed out at 45 last month, has since jumped to 78 last week, according to industry consultant Primary Vision Inc. and Bloomberg. Libyan oil could resume. Negotiations between the U.S. and regional governments in the Middle East could pave the way for oil exports.  BP agreed to sell off its entire petrochemical unit to Ineos for $5 billion. The oil market downturn has accelerated BP’s plans to transition into a low-carbon energy company. The oil company’s shares jumped on the news.

Oil slips slightly on rising coronavirus cases, returning Libyan supplies - (Reuters) - Oil prices slipped on Tuesday as investors worried that rising COVID-19 cases would hurt demand while supply could rise with a potential resurgence of Libyan oil production, which has slowed to a trickle since the start of the year. The more-active September contract for Brent LCOc2 settled down 58 cents at $41.27 a barrel. The August contract LCOc1, which expires on Tuesday, fell 56 cents, or 1.2%, to $41.15. The contract has gained 16.5% this month so far, and 81% on the quarter. U.S. crude CLc1 was down 43 cents, or 1%, at $39.27 a barrel. U.S. crude has risen 12.4% in the past month, up about 95% in the quarter, reflecting its recovery from late March. The contract pared losses in post-settlement trade after data from trade group the API showed a larger-than-expected draw in U.S. crude stockpiles. Fuel demand has recovered from the worst weeks of the outbreak, but cases have been rising in southern and southwestern U.S. states. Northeastern states like New York and New Jersey doubled the number of states from which travelers face quarantine restrictions. “Sustaining the independent show of gasoline strength will be challenged by coronavirus headlines where news has seen a definite negative shift in recent weeks,” Jim Ritterbusch, president of Ritterbusch and Associates in Galena, Illinois, said in a report. Investors will seek signs of demand recovery in weekly inventory data due on Tuesday from the American Petroleum Institute industry group and from the U.S. government on Wednesday. [EIA/S] Libya is trying to resume exports, which have been almost entirely blocked since January due to civil war. The state’s oil company hopes talks will end a blockade by eastern-based forces.

Oil posts hefty quarterly climb, but coronavirus cases, oversupply worries feed year-to-date loss - Oil futures ended lower on Tuesday as persistent concerns about the rising number of cases of COVID-19 offset upbeat data suggesting both China’s manufacturing and service sectors are recovering. Despite a significant rebound for oil prices in the second quarter, U.S. oil prices still ended the first half of the year with losses of close to 36%. “The second quarter will not soon be forgotten by energy traders given that WTI crude oil futures plunged into negative territory for the first time in history, and decidedly so, in the month of April,” said Tyler Richey, co-editor at Sevens Report Research. That was “due to logistics issues in the physical supply chain, most notably a critical lack of available storage for freshly lifted crude barrels in the U.S.” On April 20, WTI oil futures fell 306% to settle at negative $37.63. “Since then, oil and refined product markets have staged an equally historic rebound with prices poised to end the second quarter nearly 100% higher than where they ended Q1 due to a swift recovery in consumer demand as well as sharp output cuts by global oil producers,” Richey told MarketWatch. On Tuesday, West Texas Intermediate crude for August fell 43 cents, or 1.1%, to settle at $39.27 a barrel on the New York Mercantile Exchange. So far this year, prices based on the front-month contracts, were nearly 36% lower, according to Dow Jones Market Data. For the quarter, however, prices rose nearly 92%.

WTI Jumps After Biggest Crude Inventory Draw Since 2019 -- A rollercoaster day saw WTI ramped to $40, fail and fade back to close red on the day (but ends more than 90% higher for the quarter, but still down nearly 36% year to date).  "As we move into the second half of the year, the energy rebound is showing signs of stalling, however, as traders assess the threat of the recent resurgence in COVID-19 cases and the looming possibility of more economic shutdowns in the back half of the year," said Tyler Richey, co-editor at Sevens Report Research. .  API

  • Crude -8.156mm (-2.7mm exp)
  • Cushing +164k
  • Gasoline -2.459mm (-2.7mm exp)
  • Distillates +2.638 (+900k exp)

After two weekly surprise builds in a row, US crude stocks saw a major draw of over 8mm barrels - the most since 2019...  WTI hovered around $39.30 ahead of the API print and spiked higher on the surprisingly large draw... As Richey told MarketWatch"The second quarter will not soon be forgotten by energy traders given that WTI crude oil futures plunged into negative territory for the first time in history, and decidedly so, in the month of April." That was "due to logistics issues in the physical supply chain, most notably a critical lack of available storage for freshly lifted crude barrels in the U.S."

 Oil prices just had their best quarter in 30 years — what's next? -Oil prices registered their best quarterly performance in 30 years during the three months through to the end of June, staging a dramatic comeback after falling to record lows in April. Brent crude futures skyrocketed more than 80% in the second quarter. It was the international benchmark's best quarterly performance since the third quarter of 1990, when it registered gains of 142% during the first Gulf War. U.S. West Texas Intermediate futures surged 91% in the three months through to end of June, also reflecting the best quarterly performance for U.S. crude since the third quarter of 1990 when it soared 131%. However, despite notching extraordinary gains in recent weeks, both Brent and WTI futures are still down over 34% since the start of the year. The IEA's Executive Director Fatih Birol has reportedly said he believes 2020 may well come to be regarded as the worst year in the history of global oil markets, with April likely to be the worst month the industry has ever seen. "I think obviously what we saw with the Covid crisis was unprecedented and, in oil markets, it was coupled with the dislocation of the supply agreement between Russia and the OPEC countries at the same time," Martin Fraenkel, president of S&P Global Platts, told CNBC's "Squawk Box Europe" on Tuesday. Those two "massive" events impacting oil prices was "a once-in-a-generation coincidence, so I don't really expect that again," Fraenkel said. Nonetheless, he warned oil price volatility was likely to continue over the coming months, citing "really high" dislocations throughout the global energy sector. On April 20, benchmark U.S. crude prices tumbled into negative territory for the first time on record, falling as low as negative $40 a barrel at the height of coronavirus lockdown measures. It meant producers were effectively having to pay traders to take oil off their hands. Brent futures did not enter negative territory in late April, but the benchmark did slump to its lowest level since 1999 in a week some Wall Street veterans have since described as: "Scary," "unbelievable," and "very visceral."

WTI Fades Despite Biggest Crude Draw Since 2019 -  Oil prices extended gains overnight after API reported a surprisingly large crude inventory draw (the biggest in 2020) and bounced back above $40 this morning after the vaccine headlines. “The market’s main concern is demand and how Covid-19 affects it,” said Louise Dickson, an analyst at consultant Rystad Energy AS.This follows Dr. Fauci's warning yesterday that the U.S. is “going in the wrong direction” in its effort to contain the outbreak; but for now, all eyes on whether the official inventory data confirms API's surprise. DOE

  • Crude -7.195mm (-2.7mm exp, BBG -500k exp) - biggest draw since Dec 2019
  • Cushing -263k - 8 week streak of draws
  • Gasoline +1.19mm (-2.7mm exp)
  • Distillates -593k (+900k exp)

After three straight weeks of builds, DOE confirmed API's report of the biggest crude draw since 2019... After a rebound (from storm Cristobal's shut-ins) in the prior week, US crude production was flat week-over-week...Graphs Source: BloombergWTI was trading just below $40.00 ahead of the DOE print and after briefly popping, began to fade back to pre-API levels...

Oil up more than 2% on U.S. jobs data but virus fears cap gains - (Reuters) - Oil futures gained more than 2% on Thursday, supported by a drop in U.S. unemployment and a drawdown in crude inventories, but a resurgence in U.S. coronavirus infections fanned concerns that economic activity will weaken in coming weeks.   New COVID-19 cases in the United States rose by nearly 50,000 on Wednesday, the biggest one-day increase since the start of the pandemic. Numerous states are advising citizens to restrict movements and closing businesses and restaurants again, which is expected to hamper job growth. Brent crude LCOc1 futures settled at $43.14 a barrel, rising $1.11, or 2.6%. U.S. West Texas Intermediate (WTI) crude CLc1 futures settled at $40.65 a barrel, up 83 cents, or 2.1%. ADVERTISEMENT “At this time, the economic data seems to be outpacing the COVID-19 infections and it seems the growth is happening despite this uptick in cases,” said Phil Flynn, senior analyst at Price Futures Group in Chicago. U.S. non-farm payrolls increased by 4.8 million in June, beating expectations, even as permanent job losses rose. Traders said the data could lessen the desire in Washington for more federal support for the economy. “The jobs report was good, but the flip side of that was that it was so good that it might inhibit a stimulus program,” said Bob Yawger, director of energy futures at Mizuho. U.S. energy firms cut the number of operating oil and natural gas rigs to a record low for a ninth straight week, according to Baker Hughes Co.

Oil climbs for a second session, settles at highest since March - Oil futures rose for a second session on Thursday to mark their highest finish since March, buoyed by better-than-expected U.S. job growth in June, after data a day earlier showed the biggest weekly domestic crude supply decline since 2019. The U.S. added 4.8 million jobs in June and the unemployment rate fell for the second straight month to 11.1%, according to government data released Thursday. “A strong U.S. nonfarm payroll report suggests the U.S. economic rebound continues and that crude demand should follow suit,” said Edward Moya, senior market analyst at Oanda, in a market update. On Thursday, West Texas Intermediate crude for August rose 83 cents, or 2.1%, to settle at $40.65 a barrel on the New York Mercantile Exchange, after gaining 1.4% on Wednesday. For the holiday-shortened week, oil saw a weekly gain of 5%, based on the most-active contract close last Friday, according to FactSet data. Read:Is the stock market closed Friday? For July 4th, here’s everything investors need to know about trading hours and closures Global benchmark Brent oil for September BRNU20, -0.04% picked up $1.11, or 2.6%, at $43.14 a barrel on ICE Futures Europe, which will hold an abbreviated trading session Friday. Brent oil traded 5.2% higher week to date. 

  Oil jumps 2% on U.S. economic data, posts second weekly gain in three - Oil prices rose on Thursday after data showed a fall in U.S. unemployment and a sharp drop in crude stockpiles, although concerns that a spike in U.S. coronavirus infections could stall a recovery in fuel demand kept gains in check. U.S. non-farm payrolls increased by 4.8 million in June, the Labor Department reported on Thursday, beating expectations. Brent crude futures gained $1.11, or 2.64%, to settle at $43.14 per barrel, after rising 1.8% in the previous session. West Texas Intermediate crude futures gained 83 cents, or 2.08%, to settle at $40.65 per barrel, adding to a 1.4% rise on Wednesday. U.S. crude inventories fell 7.2 million barrels from a record high last week, far more than analysts had expected, U.S. Energy Information Administration data showed, as refiners ramped up production and imports eased. "Oil prices have remained rangebound as OPEC has done its job on the supply side, and the key uncertainty now remains on demand recovery," Harry Tchilinguirian, head of commodity research at BNP Paribas, said. "Crude exceeded expectations of a draw but gasoline stocks rose, which means the recovery has at least paused for a week." New COVID-19 cases in the United States rose by nearly 50,000 on Wednesday, according to a Reuters tally, in the biggest one-day spike since the start of the pandemic. California rolled back efforts to reopen its economy, banning indoor restaurant dining in much of the state, closing bars and beefing up enforcement of social distancing and other measures. Gasoline stockpiles were higher, confounding expectations of a fall. Analysts highlighted worries about the spike in cases in heavily populated U.S. sun belt states, which are among the country's biggest consumers of gasoline. Attention will be on U.S. driving activity over the upcoming July 4 holiday weekend and how quickly U.S. producers revive shut-in production, analysts said.

Oil demand to return to pre-pandemic levels by 2022, Goldman says, but unlikely to peak this decade - Analysts at Goldman Sachs expect global oil demand to return to pre-pandemic levels by 2022, citing a pick-up in commuting, a shift to private transportation and higher infrastructure spending. In a research note published Thursday, analysts at the U.S. investment bank estimated global oil demand would decline by 8% in 2020, rebound by 6% in 2021 and "fully recover" to pre-coronavirus levels by 2022. Gasoline was thought to stage the fastest demand recovery among oil products as a result of a pick-up in broader commuting activity, a shift from public to private transportation for commuting, and a higher use of cars to substitute air travel for domestic tourism — particularly in the U.S., Europe and China. Diesel demand was forecast to recover to 2019 levels by 2021, boosted by government-led spending on infrastructure projects. However, Goldman Sachs warned jet fuel demand had been the "biggest loser" from the coronavirus crisis, with consumer confidence on flying set to stay low in the absence of a vaccine and consumer behavior potentially set to change over the long term. Consequently, the U.S. bank does not expect jet fuel demand to return to pre-Covid-19 levels at least before 2023.

Saudi Crude Exports Appear to Be Down 8 Percent-- Saudi Arabia seems to have made good on its promise to cut oil production by a record amount in June. Observed Saudi crude exports for this month fell to 5.7 million barrels a day through June 29, the lowest since Bloomberg began tracking the flows at the start of 2017. That compares with 6.2 million a day in May. It’s a reduction equivalent to more than seven full supertankers over the course of the month. As the coronavirus ravages the global economy and saps energy demand, the Saudis are leading a push among major oil producers to cut supplies. State company Saudi Aramco agreed to cap output at 8.5 million barrels a day from May-July as part of an OPEC+ agreement to boost prices. The kingdom then went a step further, pledging to pump 1 million barrels daily less than that in June. While changes in exports and overall production aren’t perfectly correlated, those curbs are showing up in the kingdom’s shipments to the world’s biggest economies. Flows to China, usually the largest purchaser, are down by about 45% on a monthly basis in June to 1.1 million barrels a day. A recent flood of Saudi oil to the U.S. has dropped sharply. Flows in June have shriveled to 224,000 barrels a day, compared with almost 1.3 million in April, a three-year high. Only three supertankers and a smaller vessel were observed carrying Saudi crude to the U.S. in June, though more may emerge as some cargoes update their final destinations. Tankers hauling a combined 17 million barrels of oil from the kingdom this month haven’t yet indicated their ultimate port of call. It takes a ship roughly six weeks to sail from Saudi Arabia to the U.S. and about three weeks to China. Any vessel leaving for America now would arrive in the first half of August. The volume of oil from Saudi Arabia has swung wildly in the past few months, in part due to the lingering effects of the kingdom’s price war with Russia earlier in the year. Aramco slashed its official selling prices for oil in April and May, before raising them for this month, after the Organization of Petroleum Exporting Countries and its partners agreed to limit output.

Saudi Aramco's Dividend Math Doesn't Add Up - It’s the mother of all payouts. The $75 billion that Saudi Aramco doles out in dividends every year dwarfs what any other listed company gives to shareholders. It’s roughly equivalent to the payouts from Exxon Mobil Corp., Royal Dutch Shell Plc, Chevron Corp., BP Plc, Total SA, PetroChina Co., Eni SpA, Petroleo Brasiliero SA and China Petroleum & Chemical Corp. or Sinopec — put together. That makes Chief Executive Officer Amin Nasser’s promise to continue that level of returns for the next five years an extraordinary vote of confidence in an oil market awash with uncertainties. Saudi Aramco will be prepared to borrow money to ensure that it meets its commitment this year despite oil prices heading into negative territory, he said this month. Running up debts to keep the dividend on track is standard practice for energy companies amid the carnage of 2020’s oil market — except for those, like Shell, which plan to cut payouts altogether. You only want to fund dividends out of borrowings, though, if you’re certain it’ll be a strictly temporary measure. The risk for Aramco is that upholding such a long-term promise to shareholders will bend its entire business out of shape, just when it needs to be especially nimble as crude demand slows and goes into reverse. The core of Aramco’s profitability is its astonishingly low production costs, with operating expenses amounting to not much more than $8 a barrel of oil and equivalent products last year. It’s remarkable how quickly the spending adds up, though. Royalties paid to the Saudi state alone added another $10 a barrel or so, while corporate income tax came to around $19 a barrel and dividends swallowed a further $15. Once all those tolls were paid, Aramco didn’t have a lot of spare change left out of $60-a-barrel oil, let alone the stuff in the $40-a-barrel range it’s selling at the moment. A firm dividend policy is an unusually inflexible cost. Unlike the royalties and income taxes levied as a percentage of Aramco’s revenues and profits, payouts don’t automatically shrink if the price of crude declines. If anything, the burden per barrel rises further when prices and output fall. Perhaps in recognition of this, the Saudi state has from the start agreed to forgo its portion of any payouts to the extent that receiving them would get in the way of Umm-and-Abu investors getting their share . That may help maintain a theoretical $75 billion-a-year payout but it makes a nonsense of the idea that all shareholders are equal, not to mention the principle that a dividend policy is some sort of a commitment to future earnings. It’s not clear, either, why a company with this get-out clause would want to take on debt to meet its promised payments, although Aramco’s borrowing costs are essentially identical to those of the Saudi state.

Libya Says US Backed Talks Could End Oil Blockade- Tribes in eastern Libya backed the resumption of oil production from their region, shortly after the state energy company said negotiations between the U.S. and regional governments could lead to a restart of exports from the war-battered OPEC member. The tribes, which helped shutdown most energy facilities in the east in January, will back rebel commander Khalifa Haftar’s Libyan National Army in negotiations with the United Nations over the distribution of oil revenue, Ibrahim Bouhreba al-Baraassi, a member of one of the groups, told Bloomberg on Monday. The announcement came after the state-run National Oil Corp. said it was in talks with Libya’s UN-recognized government in Tripoli, the U.S. and some Middle Eastern powers. The NOC and Washington have called on supporters of Haftar, who’s backed in Libya’s civil war by Egypt, Russia and the United Arab Emirates, to end their blockade of the nation’s oil ports and fields. “We are hopeful that those regional countries will lift the blockade and allow us to resume our work for the benefit of all the Libyan people,” the NOC said, without identifying the nations. An agreement should “protect the oil facilities and make sure they are never used as a military target or a political bargaining chip again.” Libya’s exports have plummeted to less than 100,000 barrels a day from 1.1 million because of the shut downs. The NOC has said that neglect and damage from the conflict, which began in 2011 after the ouster of former leader Moammar Qaddafi, means it will cost hundreds of millions of dollars to restore output fully. Haftar, who’s based in the east, launched a western offensive and was close to taking the capital, Tripoli, earlier this year, which would have effectively given him control of the country. Turkey intervened on behalf of the Tripoli government of Fayez al-Sarraj and pushed Haftar’s forces back toward Sirte. The two sides are poised to square off in the central city close to Libya’s “oil crescent” -- where some of its largest fields and export terminals lie. The NOC said last week that Russian and other mercenaries had entered the western oil field of Sharara, the nation’s biggest, to prevent production from restarting. “Many oil-producing countries are benefiting from the ongoing oil blockade and are taking advantage of the absence of the Libyan oil from global markets,” Mustafa Sanalla, the NOC’s chairman, said on Monday following a meeting with the European Union’s ambassador to the country.

Yemen Rebels Send Repair Team to Stricken Tanker -- Yemen’s Houthi rebels say they’ve sent a maintenance team to repair an aging oil tanker laden with more than 1 million barrels that the United Nations and environmental groups see as a threat to marine life in the Red Sea. The decaying vessel Safer has been moored off Houthi-controlled Hodiedah province since 1988, and the crude, worth some $40 million at today’s prices, was on board when civil war broke out in Yemen in 2015. The repair team may fail to prevent the Safer from leaking oil, however, because the Saudi Arabian-led coalition fighting the Houthis has blocked access to necessary equipment, Mohammed Ali Al-Houthi, a member of the Houthi ruling political council, said in a statement. The Houthis, who are backed by Iran, can’t sell the oil; international buyers are wary of dealing with them, and the Saudi-led coalition controls waters near the vessel. Yemen’s UN-recognized government has said the rebels would be to blame for any leaks from the ship because it’s moored in a Houthi-held area. The Houthis have refused to accept any responsibility. The conflict in Yemen has caused severe hunger, an outbreak of deadly cholera, and -- in the words of the UN -- “the worst man-made humanitarian crisis of our time.” An oil spill from the Safer could destroy the livelihoods of 126,000 fishermen, according to a statement posted last month on the Yemen-based website Holm Akhdar. Some 850,000 tons of fish in the Red Sea, the Bab El Mandab waterway, and the Gulf of Aden could perish, it said.

Iran Calls For Trump's Arrest Over 'Brutal Murder' Of Revolutionary Guard General - A top Iranian prosecutor has called for the arrest of President Trump and dozens of other Americans for their involvement in the "brutal murder" of former IRGC General Qassem Soleimani in Baghdad. According to the AP, "the charges underscore the heightened tensions between Iran and the US since President Trump unilaterally withdrew America from Tehran’s nuclear deal with world powers," though President Trump "faces no danger of arrest." Iran's state-run IRNA news agency reported Monday that Tehran prosecutor Ali Alqasimehr has accused Trump and more than 30 other Americans (whom Iran believes were involved in planning and executing the Jan. 3 strike that killed Gen. Qassem Soleimani in Baghdad) of "murder and terrorism charges". The identities of those other than Trump weren't disclosed, however. After filing the charges, Alqasimehr on behalf of Iran reportedly requested an Interpol “red notice” be issued calling for the arrest of Trump and the others, which represents the highest level arrest request issued by Interpol. Local authorities end up making the arrests on behalf of the country that request it. The notices cannot force countries to arrest or extradite suspects, though they can put subjects at risk of arrest or detention if they travel abroad. Interpol hasn't commented on the requests, suggesting that it isn't taking Iran's petition seriously. Interpol's guidelines for red notices explicitly states that the agency can't get involved in political issues. Soleimani, the head of the IRGC's Quds Force (an international arm tasked with coordinating terror attacks in accordance with Iran's interests around the world) was killed during the opening days of 2020, kicking off what has been a year of non-stop news and activity as both Iran and the US were soon hammered by the coronavirus as it spread internationally from Wuhan, China.

U.S. files suit to seize gasoline in four Iran tankers headed to Venezuela (Reuters) - U.S. prosecutors late on Wednesday filed a lawsuit to seize the gasoline aboard four tankers that Iran is shipping to Venezuela, the latest attempt by the Trump administration to increase economic pressure on the two U.S. foes.The government of Venezuelan socialist President Nicolas Maduro has flaunted the tankers, which departed last month, to show it remains unbowed by U.S. pressure. The United States, has been pressing for Maduro's ouster with a campaign of diplomatic and punitive measures, including sanctions on state oil company PDVSA [PDVSA.UL].Gasoline shortages in Venezuela, like Iran a member of OPEC, have grown acute due to the U.S. sanctions, and the country has undergone an economic collapse. Still, Maduro has held on, and the failure to unseat him has been source of frustration for U.S. President Donald Trump, some American officials have said privately.In the civil-forfeiture complaint, the federal prosecutors aim to stop delivery of Iranian gasoline aboard the Liberia-flagged Bella and the Bering, and the Pandi and the Luna, according to the lawsuit, first reported in the Wall Street Journal. It also seeks to deter future deliveries.The complaint, filed in the U.S. District Court for the District of Columbia, also aims to stop the flow of revenues from petroleum sales to Iran, which Washington has sanctioned over its nuclear program, ballistic missiles, and influence across the Middle East. Tehran says its nuclear program is for peaceful purposes.Zia Faruqui and two other assistant U.S. attorneys allege in the lawsuit that Iranian businessman Mahmoud Madanipour, affiliated with Iran's Islamic Revolutionary Guard Corps, or IRGC, helped arrange the shipments by changing documents about the tankers to evade U.S. sanctions. The lawsuit says that since September 2018, the Revolutionary Guards' elite Quds Force has moved oil through a sanctioned shipping network involving dozens of ship managers, vessels and facilitators.

 Israel Is On Brink Of War With Iran & Hezbollah- Top Israeli Officials The former Israeli Defense Minister, Avigdor Lieberman, said that Iran and Lebanese Hezbollah are pushing Israel to the brink. In an interview with Israel's national Hebrew-language daily newspaper Maariv on Friday, the former Israeli Defense Minister had expressed his concern about Iran possessing enriched uranium, which he said is eight times the permitted amount according to the nuclear agreement, and that a month ago Iran successfully launched a spy satellite into orbit. Lieberman further charged that Hezbollah is now building a precision missile factory in honor of the late Iranian Quds Force commander, General Qassem Soleimani, which is pushing Israel to the brink, claiming that Israeli Prime Minister Benjamin Netanyahu has no plans to confront them. Lieberman said Iran is continuing its ongoing policies in its regular military programs and continues to fund Hezbollah, Hamas, and the Islamic Jihad, although Iran faces enormous economic difficulties of its own. However, despite Lieberman’s claims, Israel has in fact intensified their attacks against the Iranian forces and allies inside Syria this year, with multiple attacks taking place each month.

Iran threatens retaliation after what it calls possible cyber attack on nuclear site (Reuters) - Iran will retaliate against any country that carries out cyber attacks on its nuclear sites, the head of civilian defence said, after a fire at its Natanz plant which some Iranian officials said may have been caused by cyber sabotage. The Natanz uranium-enrichment site, much of which is underground, is one of several Iranian facilities monitored by inspectors of the International Atomic Energy Agency (IAEA), the U.N. nuclear watchdog. Iran’s top security body said on Friday the cause of the “incident” at the nuclear site had been determined, but “due to security considerations” it would be announced at a convenient time. Iran’s Atomic Energy Organisation initially reported an “incident” had occurred early on Thursday at Natanz, located in the desert in the central province of Isfahan. It later published a photo of a one-storey brick building with its roof and walls partly burned. A door hanging off its hinges suggested there had been an explosion inside the building. “Responding to cyber attacks is part of the country’s defence might. If it is proven that our country has been targeted by a cyber attack, we will respond,” civil defence chief Gholamreza Jalali told state TV late on Thursday. An article issued on Thursday by state news agency IRNA addressed what it called the possibility of sabotage by enemies such as Israel and the United States, although it stopped short of accusing either directly. “So far Iran has tried to prevent intensifying crises and the formation of unpredictable conditions and situations,” IRNA said. “But the crossing of red lines of the Islamic Republic of Iran by hostile countries, especially the Zionist regime and the U.S., means that strategy ... should be revised.”

ISIS was state-sponsored by US allies, says former government intelligence analyst  - A stunning new study authored by a former US government intelligence analyst and staff member for official investigations into the 9/11 attacks, concludes that the Islamic State (ISIS) received significant state-sponsorship up to 2016. The study is corroborated by revelations from two former senior British intelligence officials in exclusive interviews with INSURGE. The new evidence raises urgent questions about the material context of ISIS’ extraordinarily rapid growth, and its ability to inspire incidents such as the truck attack in New York. Contrary to conventional wisdom, the peer-reviewed paper published in the Routledge journal Studies in Conflict and Terrorism in July, confirms not only that several regional states deliberately empowered al-Qaeda and ISIS foreign fighters for their geopolitical ends, but that many of these states are ostensibly US allies in the ‘war on terror’: including Turkey, Pakistan and Saudi Arabia. How States Exploit Jihadist Foreign Fighters Jihadist foreign fighters are frequently described as non-state actors whose prominence challenges the traditional… Study author Professor Daniel Byman of Georgetown University’s Security Studies Programme was previously a Middle East analyst for the US intelligence community, and headed up the Center for Middle East Studies at the RAND Corporation — a major US government defence contractor.

China Oil Titans Plan Joint Crude Buying to Add Market Clout - China’s state-owned oil refining giants are in discussions to form a purchasing group to buy crude together, increasing their bargaining power and avoiding bidding wars. Senior executives from China Petroleum & Chemical Corp., PetroChina Co., Cnooc Ltd. and Sinochem Group Co. are in advanced talks to iron out details of the plan, said people familiar with the initiative, who asked not to be identified as discussions are private and ongoing. The proposal has won the support of the Chinese central government and relevant industry watchdogs, the people said. For a start, the group is set to collectively issue bids for certain Russian and African grades in the spot market, they said. While it’s unclear how the cooperation will evolve, the group represents refiners that import more than 5 million barrels of oil a day. That’s nearly a fifth of OPEC’s total output, which would make it the world’s largest crude buyer in theory. The initiative -- first mooted in 2019 -- gained traction this year as the coronavirus spurred historic output cuts by OPEC and its allies to regain control of the market. China's crude oil imports almost tripled in past decade The original epicenter of the pandemic, China was the first major economy to reopen and its consumption of transportation and industrial fuels is now almost back to pre-virus levels. The v-shaped recovery has in recent months prompted the country’s state-owned and independent refiners to snap up Russian and Brazilian crude in the spot market, pushing up prices. The state-owned refiners may jointly bid for Russian ESPO cargoes as early as next month in a trial run, the people said. The group might expand to allow participation from non-state owned processors -- including so-called teapots in Shandong province -- in the future, they said. Sinopec’s media office declined to comment on the matter when contacted on Friday, while PetroChina couldn’t immediately respond. Emails sent to CNOOC and Sinochem went unanswered, while nobody immediately responded to fax messages to China’s National Energy Administration and the National Development and Reform Commission.

Tens of thousands of Chinese citizens stranded overseas - Due to restrictions implemented by the Chinese government since late March to limit the number of international flights, tens if not hundreds of thousands of Chinese students, scholars, and tourists are stranded overseas. Since the beginning of March, the spread of the coronavirus has been largely been contained in China with the number of new daily cases dropped below 100 by March 6. At the same time, a sharp increase in the number of infected cases was seen in the United States and among West European countries like Italy, Spain, and the United Kingdom. Within this context, the Civil Aviation Administration of China (CAAC) announced on March 26 a “Notice on Further Reducing International Passenger Flights during the Epidemic Prevention and Control Period.” This so-called “Five-One” policy is aimed at capping the number of international flights coming into China. According to this notice, “each Chinese airline is only allowed to maintain one route to any specific country with no more than one flight per week” and “each foreign airline is only allowed to maintain one route to China with no more than one weekly flight.” The notice also required each flight’s passenger load to be no more than 75 percent. This policy led to mass cancellations of flights back to China. According to statistics from China’s Ministry of Education, about 1.6 million Chinese students and scholars are currently studying or working overseas. Among them are a large number of students who are about to graduate and many short-term visiting scholars whose exchange programs are ending. All of them will face visa expirations and the risk of unlawful overstay. The “Five-One” policy went into effect during the same period when many universities announced their plans to transition to online classes and evacuate school dormitories. Students who had already packed all their belongings and moved out from their dorms and apartments, but could not board flights back to China, were suddenly forced to find lodging for another indefinite period of time. Right after the policy was implemented, several students posted that they were stranded at an airport in Ethiopia where their layover was. Only after arriving in Ethiopia on March 28, they were told their next flight to Guangzhou, China was cancelled due to the Five-One policy. Ethiopian Airlines helped them rebook another flight to Shanghai a day later, but that flight was soon cancelled as well. They were forced to stay at the airport for days, uncertain of whether they could get home and fearful of contracting the virus in the airport. The students also lacked personal essentials since they had no access to their checked luggage. Eventually, the Chinese Embassy in Ethiopia arranged a special flight to return them to China. Their experience was not unique. Reports and posts on social media revealed similar experiences of students, scholars, and tourists who were stranded in places like Switzerland and Vancouver due to the cancellation of their return trip. The number of available flights dropped sharply from the end of March. Including flights from all over the world to all cities in China, there are only about 100 flights a week still operating according to the People’s Daily. As a result, the price of plane tickets has soared. It is not uncommon to have to pay $10,000 or more for a single ticket, many times higher than previous prices.

Britain and West urge China to scrap HK security law, open Xinjiang - (Reuters) - Britain and some two dozen Western countries urged China on Tuesday to reconsider its new national security law for Hong Kong, saying Beijing must preserve the right to assembly and free press in the former British colony. “We wish to raise our deep concerns at the imposition of national security legislation on Hong Kong which undermines ‘One Country, Two Systems’, and has clear implications for human rights,” Julian Braithwaite, Britain’s ambassador to the United Nations in Geneva, told the U.N. Human Rights Council. “We urge the Chinese and Hong Kong governments to reconsider the imposition of this legislation and to engage Hong Kong’s people, institutions and judiciary to prevent further erosion of long-standing rights and freedoms,” he said. Braithwaite spoke on behalf of 27 countries, many of them European Union members, as well as Australia, Canada, Japan, New Zealand and Switzerland. Earlier, Hong Kong leader Carrie Lam addressed the Geneva forum by video message and said that China’s national security legislation would fill a “gaping hole” and would not undermine Hong Kong’s autonomy. Braithwaite also urged Chinese authorities to allow U.N. High Commissioner for Human Rights Michelle Bachelet “meaningful and early access” to its Xinjiang region amid reports of arbitrary detention and widespread surveillance of the mostly-Muslim Uighur minority. “High Commissioner, we encourage you to provide regular further information on Hong Kong and Xinjiang in order to safeguard rights and freedoms guaranteed under international law,” Braithwaite said.

Dozens of schools close hours after reopening - (video report) South Korea has begun a phased reopening of schools, starting with classes for high school seniors. But reopening is not without risks: Dozens of schools in the city of Incheon, South Korea, closed hours after reopening due to new infections. CNN's Paula Hancocks reports.

World’s Largest Pension Fund Loses $165 Billion in Worst Quarter – The world’s biggest pension fund posted a record loss in the first three months of 2020 after the coronavirus pandemic sparked a global market rout in the period. Japan’s Government Pension Investment Fund lost 11%, or 17.7 trillion yen ($164.7 billion), in the three months ended March, it said in Tokyo on Friday. The decline in value was the steepest based on comparable data back to April 2008, reducing the fund’s total assets to 150.63 trillion yen. Foreign stocks were the worst performing investment, followed by domestic equities. The results come just months after the fund revamped top management and revised its asset allocation to focus more on overseas debt. The loss, which wiped out gains for the fiscal year, may attract political attention as social security remains a major concern for tens of millions of Japan’s retirees.

India Sends Tanks Along Border To Prevent China Redefining Line Of Actual Control - Last week satellite imaging analysts based in the West observed a significant build-up of Chinese PLA forces along the India-Chinese border Line of Actual Control (LAC) in Galwan Valley. This included the expansion of what appeared permanent or semi-permanent bases, as well as tanks and artillery units, after the deadly June 15 Galwan Valley clash which left 20 Indian troops dead and an untold number of PLA casualties.    The Indian Army responded by sending its quick reaction surface-to-air missile systems known as Akash to the disputed border region, reported widely in Indian media Saturday. New Delhi is also now said to be seeking rapid S-400 acquirement from Russia.  India has further apparently answered China's tank build-up with its own in a continuing tit-for-tat deployment of additional forces. This despite ongoing deconfliction talks between the opposing military delegations. The Hindustan Times reports Tuesday the army has sent at least six T-90 Bhishma tanks to the LAC, along with additional defensive hardware such as shoulder fired anti-tank missiles for infantry troops. The Hundustan Times describes the extra force deployment as specifically in answer to the PLA's own tanks along the border:   The army’s decision to deploy the T-90 Bishma tanks was taken after the Chinese People’s Liberation Army (PLA) had beefed up its positions on the river bed with armoured personnel carriers and troop tents. The Indian Army is occupying the dominant heights in the sector within its side of the Line of Actual Control (LAC). Infantry combat vehicles along with 155mm howitzers have been deployed all along 1597 km long LAC in East Ladakh with two tank regiments deployed in Chushul sector to repel any aggressive plans of the adversary through the Spanggur Gap. While Chinese PLA wants to make a deal on the LAC in this sector as part of withdrawal, the Indian Army is no mood to give an inch as the military aggression came from the Western Theatre Command of China with the intention of redefining the LAC. The report adds further that Indian commanders are prepared for a "long haul" deployment of additional forces and tanks to the border.

Pandemic Crushes Coffee Futures To Near 15-Year Low - Coffee fundamentals indicate deteriorating demand and oversupplied conditions could soon pressure prices to 15-year lows. A global surplus of 3.5 million bags is expected in 2020-21 as Brazil expects a record crop after a lower yield in 2019. To some degree, this had been anticipated by the market.Adding to concerns about a bulging supply imbalance, the Brazilian real has dropped 5% in the last few weeks versus the U.S. dollar. Coffee farmers in Brazil who fear continued real weakness are incented to deliver more and more coffee for export, even at the current low prices.Expectations for demand growth, the one positive variable that had supported price increases, have been dialed back in light of the global pandemic. Recent data from the International Coffee Organization revealed global arabica coffee exports of 82.75 million bags in 2019, a six percent increase over 2018, and growth had been expected to continue in 2020 until lockdowns tempered the optimism. - a Charles Schwab commodity report said, seen by FXStreet.  Now knowing the bearish fundamental backdrop, Reuters Commodity Desk forecasts a significant "downward wave (c) " that could result in coffee prices reaching $0.6380 per lb in the first half of 2021.

Governments Roll Back Coronavirus Trade Barriers – WSJ - Governments around the world have already repealed more than a third of the export bans on medical products and other restrictions put in place as a response to the coronavirus, the World Trade Organization said Monday. In a twice-yearly report on new trade policies announced by the Group of 20 leading economies, the Geneva-based body also said that while governments have continued to impose fresh restrictions on imports, they have also introduced measures to lower barriers to overseas sellers. That mix suggests that governments haven’t responded to the pandemic and the economic contraction it has caused by closing their economies to imports, as some trade experts had feared they might. ”There are signs that trade-restrictive measures adopted in the early stages of the pandemic are starting to be rolled back,” The WTO said that, excluding pandemic-related measures, governments had announced measures restricting an estimated $417.5 billion of traded goods during the period from mid-October 2019 to mid-May 2020, the third highest figure since monitoring began in 2012. However, it said measures to make trade easier—including the elimination of import taxes and the reduction of export duties—affected an estimated $735.9 billion of goods, the highest figure since 2014. Restrictions on trade have increased significantly over recent years, and most dramatically for goods moving between the U.S. and China. The WTO said the total value of affected goods rose by a further 2.8% in the six months through mid-May. Those new barriers have contributed to a slowdown in global trade flows, which fell in 2019 and suffered a collapse as economic lockdowns designed to halt the spread of the pandemic were imposed from late January through April. According to the CPB Netherlands Bureau for Economic Policy Analysis, global trade flows were 12.1% lower in April than in March, a record decline for a single month. That trade freeze has hit growth even in countries that have escaped the worst of the pandemic, since their overseas sales have stalled.

We Won’t Have a Truly Global Economy Until We Tax It That Way - Marshall Auerback - Major talks between the United States and the European Union to establish a shared tax framework for multinational companies broke down on the issue of seeking to secure an agreement on digital taxation. Big tech, which is heavily a U.S. creation, has long been in the sights of European economies, as their profits and revenues have soared and they have increasingly become major components of the 21st-century economy. Taxation is one of those areas that exposes the contradictions at the heart of globalization. Globalization of goods has proceeded quickly, as has the harmonization of industrial standards across countries. Harmonization of taxation? Not so easy.  The power to tax is the ultimate national prerogative, one that very few sovereign nations would ever seriously contemplate surrendering to a multinational global entity, even in limited degrees, as has been done in trade (e.g., the World Trade Organization), or global security (e.g., the United Nations). It therefore seems ironic that the Trump administration, largely driven by an economic nationalist agenda, would contemplate, even on an interim basis, changes to global taxation law that would affect leading U.S. big tech companies. Yet in spite of Trump’s America First rhetoric, he did authorize Treasury Secretary Steven Mnuchin to attempt to get the EU and the U.S. on the same page on a global digital tax framework, in part as a means of curbing the practice of global tax arbitrage. It would make sense for all concerned to agree on a framework that provides some degree of tax uniformity. In theory, that is; as with agriculture or oil, the tech business is a multinational one, but curiously the U.S. Treasury remains loath to expose big tech to the same kinds of global tax pressures that Monsanto or Exxon regularly deal with today. Perhaps this is because these Silicon Valley behemoths are now among the most economically dominant and profitable U.S. companies, as well as increasingly large sources of political funding for the parties (although more so Democrat than Republican at this juncture). That would explain why the Trump administration wants to keep as much of that revenue pie for itself.

PMIs are not a good month-on-month gauge It’s confession time for IHS Markit, the firm behind the purchasing managers’ indices. The firm asks thousands of purchasing managers whether activity over the current month has declined, improved, or stayed about the same compared with the previous month. IHS Markit then tallies responses up to produce a net figure where 50 signals no change in activity from month to month. Therefore, anything below 50 is seen as a contraction, and anything above 50 an expansion.Recently, however, the figures – which central bankers rely on as a bellwether for growth – have been increasingly looking out of whack with what’s going on in the real world.As we’ve noted before, when read at face value, they show that activity levels in many economies in Europe continued to decline in May and June despite an easing of lockdowns.This morning IHS Markit added an important disclaimer to that effect to its press release recording the final eurozone PMIs. It said – in essence – that the indicators should not be read as an accurate reflection of changes in output from month to month when conditions are as volatile as they are right now:   To be fair, this is a point Chris Williamson, IHS Markit’s chief business economist, has made to us in the past. (IHS Markit has today also published an article going into a great deal of depth about what the European manufacturing PMIs do – and don’t – show right now. It’s here and it’s worth reading.)*The problem is that the reason why the PMIs are so influential is because of their timeliness and their ease of use – the 50 level viewed by many as some magic marker that separates an expansion in activity from a contraction from month to month.

Is UK heading to no-trade-deal Brexit? Banks assess risk - (Reuters) - Britain and the European Union remain far apart in negotiations on a new trading relationship and analysts at many banks say the risk of a no-trade-deal Brexit at the end of the year is firmly back on the table.  Talks are being held this week in Brussels but Britain’s refusal to extend the end-2020 deadline has increased pressure to reach a deal by then or be cast adrift without any trading arrangements in place. “We think there is a 50-50 chance of a no trade-deal Brexit,” said Sarah Hewin, chief Europe economist at Standard Chartered. “There are big hurdles still and no one is really talking about Northern Ireland at the moment,” she said, referring to one of the main stumbling blocks in past negotiation rounds. Berenberg analysts put a 60% chance on a deal not being reached in time, but expect a transition to World Trade Organization (WTO) rules via small steps, with only a 5% probability of a disorderly outcome.

UK economy shows biggest drop in 40 years in early 2020 - (Reuters) - Britain’s economy shrank by the most since 1979 in early 2020 as households slashed their spending, according to official data that included the first few days of the coronavirus lockdown. Gross domestic product dropped by a quarterly 2.2% between January and March, the Office for National Statistics (ONS) said. That was below the median forecast in a Reuters poll of economists for a fall of 2.0%. Prime Minister Boris Johnson will set out his plan to speed up the British economy’s recovery later on Tuesday when he will promise to fast-track 5 billion pounds of infrastructure investment. Britain’s economy may have contracted by 20% in the first half of 2020, the Bank of England said earlier this month as the full effects of the lockdown hammered most sectors in the April-June period. The BoE has said the slump in the economy this year could be the worst in three centuries. Tuesday’s figures - which build on previously released data for the first quarter - showed a surge in household saving as their spending collapsed by the largest amount, in cash terms, since records began in the 1950s. “The lockdown of most businesses on March 23 meant that households were unable to spend even if they wanted to,” said Thomas Pugh, UK economist at Capital Economics, adding that it will take the economy until 2022 to regain its pre-crisis level.

Broader reopening of UK schools leads to spread of COVID-19 infections - Education Minister Gavin Williamson has threatened parents and families who refuse to send their children back to school in September with fines, insisting that the directive announced by Prime Minister Boris Johnson last week is “compulsory.” The threat of £60 fines per pupil, which double if not paid within 21 days, comes under conditions in which the latest Public Health England’s (PHE) statistics reveal that schools are now register second in the outbreaks of acute respiratory infections. The broadly opposed “wider opening” of schools began on June 1. Such was the opposition that the government was forced to limit it to nurseries, reception stage, year 1 and year 6, plus year 10 and year 12 on a de facto part-time basis, from June 15, with plans to open all primary schools in July scrapped. The latest Public Health England Weekly COVID-19 Surveillance Report reveals that up to June 24, schools stand just below care homes, but above hospitals for infections. There has been an overall increase in detections outside hospitals, with the wider reopening of schools a contributing factor. The report shows that the number of outbreaks in schools increased from 24 to 44 in a week—16 more than were recorded at hospitals. It confirms that the rise “coincides with wider school reopening” and criticises the lack of an expansion of “test and trace” systems meant to accompany the wider reopening of schools. Although a relatively small number, schools made up nearly 20 percent of “new acute respiratory outbreaks,” which rose from 199 to 223. The doubling of infections in schools within a week, following a still limited reopening of schools, should send alarm bells ringing for those concerned with public safety. Not so for the Conservative government. The scientific evidence has not only been ignored but met with belligerence and intimidation, with threats of fines for families who resist sending their children back to schools in September, with a deadly virus still in circulation.

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