Skip to contentSkip to site index The S&P 500 and the Nasdaq hit an all-time high on Monday after news of a potential coronavirus treatment lifted investors’ sentiment. Like thousands of migrant workers from Africa and Asia, I am finally in the land of my dreams, Qatar. I knew working here would be tough, but in the land of my dreams, every day feels like a nightmare. Some cities who threw initial investment in a next-generation nuclear power plant planned at Idaho National Laboratory are getting leery over their involvement, with Logan opting out altogether and Lehi possibly poised to follow suit. Attorney General Letitia James is conducting a broad inquiry into the Trump Organization’s financial dealings that includes an investigation into whether President Trump and his son Eric Trump improperly inflated the value of a 230-acre family retreat in Westchester, court filings revealed Monday. “It’s not going to be a serious correction, not anywhere again down near those March lows,” Wharton professor Jeremy Siegel told CNBC on Tuesday.
Delta Air Lines said in an internal memo that it will need to furlough nearly 2,000 pilots in October, a reflection of the lackluster recovery nearly six months after the coronavirus pandemic battered the airline industry.
“The voluntary measures currently on the table just don’t move the needle enough,” John Laughter, senior vice president of flight operations, said in the Monday memo, referring to the airline’s early retirement program. “It’s with this reality that we unfortunately will move forward to furlough 1,941 pilots in October.”
The furloughs would mostly affect pilots who are newer to the company, though some or all could be spared if the Delta pilot’s union agrees to an across-the-board cut, Mr. Laughter said. Though there is bipartisan support to extend federal funding for the industry to keep workers employed, it remains in limbo as stimulus talks have stalled.
On Friday, the pilot’s union, the Delta Master Executive Council, said that 1,806 pilots had signed up for early retirement, with most expected to leave the company on Sept. 1.
The union criticized Delta management on Monday for using the threat of furloughs to pressure pilots to accept cuts.
“It’s not too late for management to complete discussions at the bargaining table and help mitigate the need to furlough,” Chris Riggins, a union spokesman, said in a statement.
President Trump’s repeated insistence that he wants to permanently repeal the payroll tax, which is used to fund Social Security, would deplete the trust fund used to pay for the entitlement program by the middle of 2023, according to a review by the fund’s actuary.
While the assessment is based on hypothetical legislation, it highlights the risks in Mr. Trump’s plan to inject money into workers’ pockets and contradicts his promise to leave Social Security funds untouched.
“Under this hypothetical legislation, benefit obligations could not be met after the depletion of the asset reserves and elimination of payroll taxes,” said Stephen C. Goss, the chief actuary at the Social Security Administration.
His assessment came in response to a request from four senators — Chuck Schumer of New York, Ron Wyden of Oregon and Chris Van Hollen of Maryland, all Democrats, and Bernie Sanders of Vermont, an independent — seeking information about the implications of a hypothetical measure that would eliminate the payroll tax after January 1, 2021.
Traditionally, employees and employers each pay a Social Security payroll tax of 6.2 percent of wages, or 12.4 percent when put together. Mr. Trump, who temporarily deferred payroll taxes as a way to circumvent stalled relief negotiations in Congress and provide aid to workers, has said that he hopes to make the payroll tax cut permanent if re-elected in November.
His suggestion, which has met resistance in both parties and would require Congress to approve legislation doing so, prompted the senators to request the analysis.
“This analysis makes clear: This is another thinly veiled attempt to gut Social Security and go after the American people’s hard-earned benefits,” Mr. Van Hollen said in a statement.
Wall Street pushed further into record territory on Monday as the S&P 500 rose 1 percent. Shares in Europe and Asia were also higher.
Airline stocks rallied, with American Airlines, Delta Air Lines and United Airlines all gaining about 10 percent, after the Transportation Security Administration said Sunday was the second busiest day of travel since the pandemic. Carnival Corp., the cruise ship giant, was one of the best-performing stocks of the day.
The enthusiasm for stocks sent bond prices lower. Both major benchmarks for oil futures — Brent crude and West Texas Intermediate — saw gains.
The rally reflected some rising hopes about medical advances against the coronavirus. In the United States, the Food and Drug Administration authorized the emergency use of blood plasma from people who have recovered from coronavirus infections for patients hospitalized with Covid-19. Although convalescent plasma has not been proven to work in randomized trials, many researchers see it as a potential bridge until a more effective treatment, or a vaccine, is available.
Trump aides reportedly told lawmakers that a vaccine would probably be approved before drug trials are complete, in time for the presidential election in November. Such a move would most likely raise concerns that the administration was cutting corners for political purposes.
When coronavirus shutdowns caused millions of layoffs and furloughs this year, landlords feared they would stop receiving rent checks, tenants worried they would be evicted, and economists and politicians braced for a housing crisis.
Nearly six months into the pandemic, few of those fears have materialized. Interviews and surveys of landlords across the country have shown little difference in rent collections from a year ago. The government’s financial-rescue efforts appear to have helped tenants keep their homes.
But those government programs are running out. The $600 a week in extra unemployment benefits from the federal CARES Act ended last month, and only about 20 states still have eviction moratoriums, down from 43 in May.
Now mounting bills are forcing many tenants to take drastic measures, some with long-term effects.
Nura Moshtael, 45, has long dreamed of becoming a commercial pilot, and this year, she finally began to work toward that goal, starting two new jobs to save for flying lessons. But now she has lost both of them because of the coronavirus. Last month, unable to afford rent, she left her apartment and moved back into her childhood home with her mother in Macon, Ga.
She has abandoned her dream of becoming a pilot. “That’s dead in the water now,” she said. “I can’t afford to chase that dream anymore.”
Sunday was the second busiest day of travel since the pandemic clobbered airlines this spring, according to data from the Transportation Security Administration. More than 840,000 people were screened at airport checkpoints on Sunday, about 34 percent as many as last year. The only day with more screenings was the Thursday before the July 4 weekend, which saw 37 percent as many screenings as a year ago.
American Airlines received approval from the Environmental Protection Agency to use a new cleaning spray on its planes that purports to kill coronaviruses on surfaces for up to seven days. The agency described the product, Allied BioScience’s SurfaceWise2, as groundbreaking and a “first-ever long-lasting antiviral product.” American said it would start using SurfaceWise2 in the coming months.
Across the United States, department stores are shuttering and malls are defaulting on their loans, a sign of the economic devastation wrought by the coronavirus.
But for a handful of Wall Street investors, the trend has turned out to be very, very profitable.
Months ago, a few hedge funds saw the demise of malls coming, and bet that many of those brick-and-mortar icons of America wouldn’t be able to make their debt payments, a trade known as a “short.” So as their prediction has come true, in part with the help of the pandemic, those investors have made hundreds of millions of dollars.
Carl Icahn, one of the country’s best-known investors and a onetime corporate raider, made $1.3 billion on one trade alone. He had made the bet last year after meeting with Catie McKee, a 31-year-old analyst for MP Securitized Credit Partners, a hedge fund. Ms. McKee, who spotted the opportunity by inspecting malls’ mortgages, more than doubled investors’ money on the trade.
The trades, known as the “mall short” in financial circles, again raise the debate over the value of such bets, particularly amid the backdrop of a pandemic that has devastated the economy. Some criticize such trades as bottom-feeding because they can push a business over the edge while contributing little to the economy. But defenders of the “short” say it can help expose corporate fraud or deflate a dangerously overvalued asset, which can aid the smooth functioning of markets.
When European countries ordered businesses to shutter and employees to stay home as the coronavirus spread, governments took radical steps to shield workers from the prospect of mass joblessness, extending billions to businesses to keep people employed.
The layoffs are coming anyway.
Airbus, BP, Renault, Lufthansa, Air France, the Debenhams department store chain, Bank of Ireland, the retailer W.H. Smith and even McLaren Group, which includes the Formula One racing team, along with countless smaller businesses, are among those planning cuts that will sweep factory workers, retail employees and high-paid white-collar workers into the ranks of the unemployed.
The tsunami of layoffs is about to hit Europe as companies prepare to carry out sweeping downsizing plans to offset a collapse in business from the outbreak. Government-backed furlough schemes that have helped keep around a third of Europe’s work force financially secure are set to unwind in the coming months.
As many as 59 million jobs are at risk of cuts in hours or pay, temporary furloughs, or permanent layoffs, especially in industries like transportation and retail, according to a study by McKinsey & Company.
Governments are warning that millions will soon lose paychecks.
“Europe has been successful at dampening the initial effects of the crisis,” said John Hurley, senior research manager at Eurofound, the research arm of the European Union. “But in all likelihood, unemployment is going to come home to roost, especially when the generous furlough programs start to ease off,” he said.
“There’s going to be a shakeout,” he added, “and it’s going to be fairly ugly.”
With a federal moratorium coming to an end, legal aid lawyers say they are preparing to defend renters in housing court.
For tenants, especially those with limited means, having a lawyer can be the difference between being evicted or being able to stay on in a rented home. Yet legal representation for tenants is relatively rare in housing courts. Surveys from several big cities over the years have shown that in housing court, landlords are represented by lawyers at least 80 percent time, while tenants tend to have lawyers in fewer than 10 percent of cases.
This unlevel playing field is about to come into sharper focus in the months ahead, now that the four-month pause on evictions provided by the CARES Act, followed by a 30-day notice period that ends on Monday, is coming to an end. The moratorium had provided protection to about 12 million tenants living in qualifying properties. Additionally, local moratoriums in some states had protected renters in homes not covered by the federal law.
“Tenants are not equipped to represent themselves, and eviction court places them on an uneven playing field that allows landlords to run roughshod over their rights,” said Ellie Pepper of the National Housing Resource Center, which focuses on housing policy and funding issues.
Demand for legal assistance with housing issues is on the rise in states where local moratoriums for rentals not covered by the CARES Act have already ended. In the Atlanta area, legal aid lawyers say calls seeking help in dealing with private landlords are running 25 percent higher than they were two months ago. In particular, lawyers said, calls are coming in from Clayton County, one of the poorest areas that Atlanta Legal Aid serves.
“Our caseloads haven’t yet exploded, because the courts just started hearing cases that were pending before the pandemic struck,” said Lindsey Siegel, a lawyer with Atlanta Legal Aid. “But it’s coming.”
🗣 The Republican National Convention kicks off on Monday with the only in-person component of either party’s events: a roll call of delegates inside the Charlotte Convention Center. Over four days of programming, speakers include the former U.N. ambassador Nikki Haley; Senator Mitch McConnell; Vice President Mike Pence; Secretary of State Mike Pompeo; former Mayor Rudy Giuliani of New York; the Ultimate Fighting Championship’s president, Dana White; and all four of President Trump’s adult children. Mr. Trump himself will speak every night of the convention.
⛰ The Jackson Hole Symposium is held virtually on Thursday and Friday, featuring central bank chiefs from around the world. Jay Powell, the Fed chair, delivers the keynote on Thursday, which is expected to address how the bank is fighting the pandemic downturn and grappling with persistently low inflation.
🛍 On the earnings front, a number of retailers open their books: Best Buy on Tuesday and Abercrombie & Fitch, Dollar General, Dollar Tree and Gap on Thursday. Other companies publishing their latest financials include J.M. Smucker and Salesforce on Tuesday and Rolls-Royce and WPP on Thursday.
✈️ Creditors for Virgin Atlantic vote on Tuesday on the airline’s rescue deal, which includes a reduction in the amount it owes to lenders, suppliers and others. The company has warned that it will soon run out of cash if the agreement is not approved.
Author: Niraj Chokshi
Stock Market News for Aug 25, 2020
The S&P 500 and the Nasdaq hit an all-time high on Monday after news of a potential coronavirus treatment lifted investors’ sentiment. While, the Dow edged past 28,000 points for the first time in six months boosted by rally among growth-sensitive stocks.
The Dow Jones Industrial Average (DJI) added 378.13 points, or 1.4%, to close at 28,308.46 and the S&P 500 rose 34.12 points, or 1% to close at 3,431.28. The Nasdaq Composite Index closed at 11,379.72, adding 67.92 points, or 0.6%. The fear-gauge CBOE Volatility Index (VIX) decreased 0.8%, to close at 22.37. Advancing issues outnumbered declining ones for 2.52-to-1 ratio on the NYSE and a 1.26-to-1 ratio on the Nasdaq favored advancers.
On Monday, the Dow closed above 28,000 for the first time in six months and was only 4.2% away from its record closing high on Feb 12, 2020. The Boeing Company (BA – Free Report) gave the Dow its biggest lift as the aircraft maker shares surged 6.4%. Boeing stocks sports a Zacks Rank #4 (Sell). You can see the complete list of today’s Zacks #1 Rank (Strong Sell) stocks here.
Of the 11 major sectors of the S&P 500, only health sector ended in the red. Energy and financials emerged as the highest gainers of the broader index, advancing 2.8% and 2.3% for the session. Companies benefiting from economic reopening also closed higher. Shares of American Airlines Group Inc. (AAL – Free Report) and United Airlines Holdings, Inc. (UAL – Free Report) closed at least 10% higher for the day.
Overall, the S&P 500 posted 45 new 52-week highs and no new lows, while the Nasdaq Composite recorded 84 new highs and 36 new lows.
On Sunday, the U.S. Food and Drug Administration gave emergency authorization for convalescent plasma treatment for hospitalized coronavirus patients. The treatment uses blood plasma donated by people who have recovered from the Covid-19.
Post the authorization, President Donald Trump said at a news conference on the same day that the plasma treatment cuts the coronavirus mortality rate by 35%.The Trump administration is also considering fast-tracking AstraZeneca PLC (AZN – Free Report) and Oxford University’s experimental COVID-19 vaccine and hopes to deploy it in November before Americans head to the Presidential election polls.
Shares of Liminal BioSciences Inc. (LMNL – Free Report) , ThermoGenesis Holdings, Inc. (THMO – Free Report) and XBiotech Inc. closed 7.1%, 11.1% and 6.6% for the session.
Additionally, the news brought optimism among traders and helped beaten-down cyclical sectors to rally on Monday. Stocks from energy and industrials sectors and areas that would benefit from a faster economic rebound helped the Nasdaq and the S&P 500 rally for the session.
Last year, it generated $24 billion in global revenues. By 2020, it’s predicted to blast through the roof to $77.6 billion. Famed investor Mark Cuban says it will produce “the world’s first trillionaires,” but that should still leave plenty of money for regular investors who make the right trades early.
See Zacks’ 3 Best Stocks to Play This Trend >>
Author: Zacks Investment Research
I Came to Work in Qatar to Pursue My Dreams, But My Life is a Nightmare
The author is one of the 93 migrant workers Human Rights Watch interviewed for a new report on salary abuses ahead of Qatar’s 2022 FIFA World Cup, he has requested anonymity for his safety; work visas and residence permits for migrant workers in Qatar are directly tied to employers, hence workers are often afraid to speak publicly against salary abuses.
Like thousands of migrant workers from Africa and Asia, I am finally in the land of my dreams, Qatar. I knew working here would be tough, but I thought I would be able to regularly send money home to my family and live decently.
I had imagined that once here, I could sneak a peek at gli Azzuri, the Italian national team and my favorite, but seeing the way Qatar treats workers like me preparing for the 2022 FIFA World Cup, my excitement dwindled.
In the land of my dreams, every day feels like a nightmare.
The soaring unemployment rate in Kenya, my home country, pushes thousands of young people to look for jobs overseas. A family friend had moved here recently to work in the hospitality industry. He appeared to have a decent life. That, plus the lack of income tax and the promise of medical coverage helped lure me here.
My friend did say that working in the Gulf is not for the faint of heart, but I asked myself if things could be worse than they are in Kenya. I have a bachelor’s degree with honors and still found no stable job opportunities in my hometown. I knew I needed something to supplement the freelance writing I was doing.
I found a local recruiting agent who agreed to facilitate my visa and job application process for a security guard job. He demanded $1,500 in recruitment fees. This is a huge amount, but I asked around and I found that all Kenyan migrant workers pay recruitment fees for a job in Qatar. My parents offered to cover me. They said it would leave them in a financial crunch, but it would be worth it to see my life take off. After working hard their whole lives, both of them will be forced to retire this year, so it is up to me to fend for myself and shoulder my family’s responsibilities.
The recruiting agent turned out to be both disorganized and surreptitious. The flight he arranged for me was an eight-hour journey from my hometown. I had paid him to secure me a job as a security guard, but after the non-refundable payments were made, when he handed me my paperwork hours before my departure, I discovered my visa and employment contract were for a cleaning position. Not to worry, he said, when I get to Qatar I can change jobs.
My Qatar dream was finally in motion as the plane powered into the gloomy night sky. I was greeted by the architectural masterpiece that is Hamad International Airport. Things were bound to pick up now, I thought. But my employer, who was supposed to meet me, was nowhere to be found. After numerous frantic phone calls, he told me to get a taxi and go to my accommodations.
Inside my room, at the shoebox accommodations I found four other workers who seemed miserable. We didn’t talk much. The place was rundown, with no beds, only used mattresses and soiled duvets which harbored an insect colony. I willed myself to be optimistic and decided to talk to my employer in the morning about changing jobs.
My employer heard my concerns and took me for an interview at a local security services company. I was offered an employment contract that seemed fair. For eight hours of work a day, my monthly salary would be 1,500 Qatari riyals ($412), I would be paid at a higher rate for any overtime work, and the employer would cover my health care and housing.
In Qatar, a migrant worker needs to get their previous employer’s written permission to change jobs while on contract. While for me, it was a smooth process, other workers have told me how difficult it was for them, and how employers often use the power they have over workers to further exploit them. My new company made it a point to inform me that they themselves never give workers the permission to change jobs. I didn’t think too much about this, I was just happy to leave my infested room and start earning money. In retrospect, I wish I had.
The legal transfer of my immigration documents took a month, without pay, and when I finally was ushered into the security company’s housing, I was ready for better days.
The new housing was better than where I had been living, but still not up to bare minimum standards. Ten of us were stacked in a stuffy room. About 15 people shared a toilet, and about 60 shared the communal kitchen, which was built for a handful of people.
Since then, with different assignments, I have lived in various places. At one point I was sleeping in the educational facility I was guarding. For the last month I have been sharing my room with five other men from my company, and for a while, water from the air conditioner was leaking onto our beds.
As for my working conditions, the four hours of overtime I put in daily are ignored in my pay slips, I work seven days a week without a day off, wages are delayed for up to three months, and during this time they don’t even provide us with a food allowance.
My March salary arrived in June, April’s salary came in July. I have not been paid for May, June, and July. For every day that my wages are delayed, I go deeper into debt, because I send 1,000 Qatari Riyals ($275) a month home and have no choice but to borrow money for food.
I have been here for more than six months, but I have not been issued a Qatar Identity Card, which is mandatory for migrant workers. Other employees tell me it takes eight to ten months for our company to issue Identity Cards. Without the card, I can’t take a complaint to the Labor Department; I can’t even step out of my housing without risking arrest.
I have not had a single off day since I started working six months ago – a single day off will cost me 50 Qatari Riyals ($14). I desperately need a few days off to fight the fatigue that is dragging me down. However, I also desperately need a complete salary to break even and start moving toward a decent life.
My assignments vary. I have worked at hotels, offices, and schools. Currently I stand for 12 hours a day, outside a hotel in one of Qatar’s upscale neighborhoods. I am tasked with directing and controlling traffic, conducting regular foot patrols, and assisting and escorting guests who enquire about whether rooms are available. My duty is made harder by the unwavering and relentless Middle East sun.
I finally got a health card after five months. Imagine being in a foreign country during a global pandemic and not having health care. To make matters worse, it seems that my company doesn’t care much about personal protective equipment. They bring gloves and masks just once in a while. The hotel staff often lends us masks. Luckily, the only person I know of who has had Covid-19 was a supervisor at the hotel before I was assigned here.
My workmates encourage me when I am at my lowest points. We understand the systematic challenges workers experience daily. The government talks about reforming labor laws but most of it feels like it is only on paper. People on the ground are really suffering and rogue employers are getting away with gross injustices. The class division is stark in Qatar. The country is one of the richest in the world, but it was built and continues to run on the fuel of its migrants. The exploitation and oppression have taken a mental and physical toll on us, but the resolve to improve our lives keeps us going.
The 2022 World Cup is another thorny matter. Even the biggest and glitziest stadiums can’t justify maltreatment of workers.
Overworked, underpaid, and left on my own without any security net, I have a false choice: stick it out, or return to Kenya, defeated and drowning in debt.
The author asked not to use his name for his protection.
Northern Utah city opts out of planned nuclear power project over money concerns
SALT LAKE CITY — Cost concerns over Logan’s participation in a next-generation nuclear power plant planned at Idaho National Laboratory led the city to withdraw from the project, and Lehi is considering a similar move in its council meeting Tuesday.
“My concerns were many and varied,” Logan Finance Director Richard Anderson said of last week’s decision.
“First of all I think the project is interesting and intriguing and something that I think is important. I would love to see nuclear power because it is cleaner and is a base load power source. I would love to see it succeed,” Anderson said.
Still, changes in funding by the U.S. Department of Energy for the Carbon Free Power Project caused Anderson concern, as it did for Mark Montgomery, the city’s light and power director, and prompted both of them to recommend Logan withdraw its participation.
“We don’t have the experience to be swimming in these waters. I didn’t feel good about it,” Anderson said.
The city, as a member of the Utah Associated Municipal Power Systems, invested $400,000 and was due to commit another $654,000 by Sept. 14 or vote to bow out altogether.
Cities and special service districts that have their own municipal power systems in Utah and surrounding states have been eyeing NuScale’s Small Modular Reactor project as a way to diversify their energy portfolios, especially as aging coal plants are retired.
The plant’s unique design features 12 distinct modules, with the first scheduled to come online in 2029 with the 11 others following the next year. It is currently undergoing licensing review at the U.S. Nuclear Regulatory Commission, and while there is a global race to be the first to successfully deploy this technology, NuScale is ahead of its competitors.
The project is backed heavily by the U.S. Department of Energy, which gave NuScale a competitive award of $226 million in 2013 to develop the technology. Two years later, the federal agency gave NuScale $16.7 million for licensing preparation.
Ultimately, the energy department committed to spend $1.4 billion on the project with an eye toward reducing carbon emissions, combating climate change and to position the country as a world leader in nuclear technology.
But critics say the proposed 720-megawatt plant is too risky and ratepayers — hence taxpayers — should not be footing the cost for technology they say is yet to be proven.
LaVarr Webb, spokesman for the municipal power association, said the investment schedule was specifically designed with these exit opportunities if cities or special districts become nervous.
The project, he added, will not proceed if costs prove too high.
The project has also come under criticism for what some say is a lack of transparency.
Earlier this month, the Utah Taxpayers Association urged cities to withdraw ahead of the deadline and complained about meetings in which groups were turned away unless they were project participants.
Rusty Cannon, vice president of Utah Taxpayers Association, said because the municipal power association is exempt from Utah’s open meeting laws, it can close its doors to others.
“We asked to observe a recent meeting and were denied access. That is the same response many others have also received,” Cannon said.
While association leaders have spent hours on video calls with the association and others, Cannon said that format does not provide the same answers.
Webb said meetings in which non-project participants were turned away, with perhaps the exception of one, are in line with why other governmental entities can close meetings under Utah law, such as contractual issues, litigation or personnel issues.
On Tuesday in Lehi, the City Council will consider a resolution outlining the city’s withdrawal from the project.
Author: Amy Joi O’Donoghue
N.Y. Attorney General Letitia James sues Eric Trump, Trump Organization in connection with financial fraud investigation
President Trump has more tax trouble.
New York Attorney General Letitia James is conducting a broad inquiry into the Trump Organization’s financial dealings that includes an investigation into whether President Trump and his son Eric Trump improperly inflated the value of a 230-acre family retreat in Westchester County, court filings revealed Monday.
Papers unsealed in Manhattan Supreme Court indicate James’ office has not yet determined whether the president, his family or his company broke any laws. The civil investigation centers on allegations Trump’s company committed fraud by attempting to minimize real estate taxes, including on his Seven Springs property in Bedford.
The Trump Organization received a $21.1 million tax deduction on the property with a 50,000-square-foot mansion in 2015. Eric Trump is president of the corporate entity that owns Seven Springs and was “intimately involved” in efforts to develop the site, according to the AG’s office.
The attorney general opened the probe in March 2019 following Michael Cohen’s testimony to Congress, filings state. Other Trump properties, including 40 Wall Street in lower Manhattan; Trump International Hotel and Tower Chicago, and the Trump National Golf Club in Los Angeles, are part of the investigation, according to papers. The AG’s office said it sought court intervention after months of stonewalling by Eric Trump and the company.
“[The Office of Attorney General] is currently investigating whether the Trump Organization and Donald J. Trump … improperly inflated the value of Mr. Trump’s assets on annual financial statements in order to secure loans and obtain economic and tax benefits. One particular focus of this inquiry, as relevant here, is whether the Trump Organization and its agents improperly inflated, or caused to be improperly inflated, the value of the Seven Springs estate,” Assistant Attorney General Matthew Colangelo wrote.
Trump bought the Seven Springs estate in 1995 for $7.5 million and attempted to develop it as a golf course and residential development. When those efforts failed, he scored a tax break by pledging not to build on nearly 75% of the property. The Seven Springs mansion boasts 60 rooms, 15 bedrooms and two servant wings. The Trump Organization’s website describes it as a family retreat, though Trump has preferred visiting Mar-a-Lago in Florida and his golf club in Bedminster, N.J., during his presidency.
“This is simply a discovery dispute over documents and the like. As the motion papers clearly state, the [attorney general] has made no determination that anything was improper or that any action is forthcoming. We will respond to this motion as appropriate,” Trump Organization attorney Alan Garten said.
Manhattan District Attorney Cy Vance Jr. is locked in a separate legal battle with Trump over the president’s personal tax returns in connection with an investigation of hush money payments made to women during the 2016 presidential campaign.
James asked a judge to force Eric Trump and the company to comply with seven subpoenas. The AG named Eric Trump because he has refused to testify under oath, she said. The suit also names Trump attorneys who James says are making overly broad claims of attorney-client privilege.
“Nothing will stop us from following the facts and the law, wherever they may lead. For months, the Trump Organization has made baseless claims in an effort to shield evidence from a lawful investigation into its financial dealings,” James said in a news release. “They have stalled, withheld documents, and instructed witnesses, including Eric Trump, to refuse to answer questions under oath. That’s why we’ve filed a motion to compel the Trump Organization to comply with our office’s lawful subpoenas for documents and testimony. These questions will be answered and the truth will be uncovered, because no one is above the law.”
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Cohen told Congress that Trump routinely inflated his value when seeking loans or trying to secure a spot on the Forbes lists of the richest people. Meanwhile, Trump minimized his worth to avoid real estate taxes, according to Cohen.
Details of the AG’s investigation were filed under seal.
“[The Office of Attorney General] has kept this investigation confidential to avoid prejudice to the investigation and to avoid undue reputational harm to witnesses and the subjects of the investigation,” Assistant Attorney General Austin Thompson wrote.
“[The Office of Attorney General] has obtained information in this investigation from numerous individuals and entities whose identities it has sought to keep confidential. Premature public disclosure of their identities or the evidence they have provided could impair [the Office of Attorney General’s] ability to seek further testimony and documents from those and other witnesses and entities.”
The filing came on the first day of the Republican National Convention.
- Letitia James
- Eric Trump
- Trump Organization
Author: Stephen Rex Brown
Even another coronavirus spike in the fall won’t derail Wall Street’s rally, says Jeremy Siegel
The rally on Wall Street would not be derailed for long even if there were another spike in coronavirus cases this fall, Wharton School professor Jeremy Siegel told CNBC on Tuesday.
“It’s not going to be a serious correction, not anywhere again down near those March lows. A little pause if we get that wave, but I don’t think it’s going to really stop the longer-term momentum upward,” Siegel said on “Squawk Box.”
Siegel’s comments come one day after the S&P 500 hit an all-time high and closed above 3,400 for the first time, with the benchmark index now more than 55% above its coronavirus-era lows on March 23.
Stocks are forward-looking assets, with much of their value derived from earnings at least 12 months into the future, Siegel stressed, when explaining why the market may be resilient this fall in the face of a lingering pandemic and related economic challenges.
“That’s why you can have a ‘U’ economy, a ‘W’ economy, and you can still have a ‘V’ stock market,” the longtime market bull said, describing the various scenarios for the shapes the charts could take.
Siegel also remained hopeful that scientists and doctors would be able to develop vaccines and therapeutics that diminish the risks presented by Covid-19 alongside continued support from the Federal Reserve. “Even if it takes another six months more than we hope to get an effective vaccine, when you come back with the liquidity that’s provided by the Fed, that’s a really powerful force.”
Tech companies have been a major driver of the stock rally since March as stay-at-home orders caused widespread adoption of remote work and an acceleration of the online shopping trends that had been in place prior to the pandemic.
With the coronavirus demonstrating the importance of technology in the modern world, Siegel said he believes there is room for those stocks to remain strong in 2021 while other parts of the market that have lagged in the recovery to outperform next year.
“I don’t think that that means that tech is going to go down,” Siegel said. “The amount of the liquidity that’s been added to this economy is there. It’s not going to be withdrawn by the Fed because unemployment is going to remain high for a long time. … So I think there’s room really for both groups to go up in 2021, even though we finally might get a turn towards value.”
Additionally, yields on U.S. Treasurys remain very low, as do interest rates on bank accounts, Siegel said. Both of those factors continue to benefit value stocks as investors seek yield, he argued.
“Dividend-paying stocks are still 2%, 3%, 4% and those are mostly value stocks. To the extent people search those, and the extent that the economy finally reopens with therapeutics and vaccines, that does argue for a rotation,” said Siegel. But, he reiterated, “[It] does not necessarily mean, though, that the tech stocks have to go down.”
Author: Kevin Stankiewicz