Archive for ‘US economy’

07/05/2020

Trump says coronavirus worse ‘attack’ than Pearl Harbor

US President Donald Trump has described the coronavirus pandemic as the “worst attack” ever on the United States, pointing the finger at China.

Mr Trump said the outbreak had hit the US harder than the Japanese bombing of Pearl Harbor in World War Two, or the 9/11 attacks two decades ago.

His administration is weighing punitive actions against China over its early handling of the global emergency.

Beijing says the US wants to distract from its own response to the pandemic.

Since emerging in the Chinese city of Wuhan in December, the coronavirus is confirmed to have infected 1.2 million Americans, killing more than 73,000.

What did President Trump say?

Speaking to reporters in the Oval Office of the White House on Wednesday, Mr Trump said: “We went through the worst attack we’ve ever had on our country, this is worst attack we’ve ever had.

“This is worse than Pearl Harbor, this is worse than the World Trade Center. There’s never been an attack like this.

“And it should have never happened. Could’ve been stopped at the source. Could’ve been stopped in China. It should’ve been stopped right at the source. And it wasn’t.”

Media caption Life for asylum seekers in lockdown on the US-Mexico border

Asked later by a reporter if he saw the pandemic as an actual act of war, Mr Trump indicated the outbreak was America’s foe, rather than China.

“I view the invisible enemy [coronavirus] as a war,” he said. “I don’t like how it got here, because it could have been stopped, but no, I view the invisible enemy like a war.”

Media caption US shopping centres re-open: ‘This is the best day ever’

Who else in Trump’s team is criticising China?

The deepening rift between Washington and Beijing was further underscored on Wednesday as Secretary of State Mike Pompeo renewed his rhetoric against China, accusing it of covering up the outbreak.

He stuck by his so far unsubstantiated charge that there is “enormous evidence” the coronavirus hatched in a Chinese laboratory, even while acknowledging there is still uncertainty about its origins.

“Those statements are both true,” America’s top diplomat told the BBC. “We don’t have certainty and there is significant evidence that it came from a lab.”

Chinese state media accused him of lying.

One of the most trusted US public health experts has said the best evidence indicates the virus was not made in a lab.

Dr Anthony Fauci, a member of Mr Trump’s coronavirus task force, said on Monday the illness appeared to have “evolved in nature and then jumped species”.

Why is the US blaming China?

President Trump faces a tough re-election campaign in November, but the once humming US economy – which had been his main selling point – is currently in a coronavirus-induced coma.

A Pew opinion survey last month found that two-thirds of Americans, a historic high, view China unfavourably. But roughly the same margin of poll respondents said they believed Mr Trump acted too slowly to contain the pandemic.

As Mr Trump found his management of the crisis under scrutiny, he began labelling the outbreak “the China virus”, but dropped that term last month days before speaking by phone with Chinese President Xi Jinping.

Both Mr Trump and his likely Democratic challenger, Joe Biden, appear to be fastening on to China’s unpopularity as an election issue, with each accusing the other of being a patsy for America’s primary economic competitor.

As the coronavirus began spreading in the US back in January, Mr Trump signed phase one of a trade deal with China that called a truce in their tariff war. The US president’s hopes of sealing a more comprehensive phase two deal are now in limbo because of the pandemic.

graph showing deaths and cases in the US

Source: The BBC

04/05/2020

Coronavirus: billionaire Warren Buffett’s prediction for America after Berkshire Hathaway’s US$50 billion loss

  • Buffett’s Berkshire posted a record quarterly net loss of nearly US$50 billion
  • Company sells entire stakes in US airlines, Buffett says ‘world has changed’
Warren Buffett speaks during the virtual Berkshire Hathaway annual shareholders meeting. Photo: Bloomberg
Warren Buffett speaks during the virtual Berkshire Hathaway annual shareholders meeting. Photo: Bloomberg

Billionaire investor Warren Buffett said Saturday he’s confident the US economy will bounce back from its pummelling by the coronavirus pandemic because “American magic has always prevailed”.

The 89-year-old made the sanguine prediction about the world’s largest economy as his holding company Berkshire Hathaway reported first-quarter net losses of nearly US$50 billion.

Buffett also announced Saturday that his company had sold all its stakes in four major US airlines last month, as the pandemic clobbered the travel industry.

“It turns out I was wrong,” he said of his acquisitions of 10 per cent stakes in American Airlines, Delta Air Lines, Southwest Airlines and United Airlines.

Berkshire Hathaway had paid US$7 billion to US$8 billion, and “we did not take out anything like that,” he said.

Between the purchases that took place over months, and the sale, “the airlines business I think changed in a very major way” and could no longer meet Berkshire criteria for profitability, he said.

Buffett’s announcement may further hurt airlines already pushed to the brink by coronavirus lockdown measures, now looking to the US government for US$25 billion in relief funds.

Berkshire Hathaway, based in Omaha, Nebraska, called its first-quarter setback “temporary” but said it could not reliably predict when its many businesses would return to normal or when consumers would resume their former buying habits.

Warren Buffett (left) and vice-chairman Charlie Munger at the annual Berkshire shareholder shopping day in Omaha, Nebraska in 2019. Photo: Reuters
Warren Buffett (left) and vice-chairman Charlie Munger at the annual Berkshire shareholder shopping day in Omaha, Nebraska in 2019. Photo: Reuters
“We’ve faced great problems in the past, haven’t faced this exact problem – in fact we haven’t really faced anything that quite resembles this problem,” Buffett said in a lengthy speech on the country’s economic history.

“But we faced tougher problems, and the American miracles, American magic has always prevailed and it will do so again.”

“We are now a better country, as well as an incredibly more wealthy country, than we were in 1789 … We got a long ways to go but we moved in the right direction,” he said, referencing the abolition of slavery and women’s suffrage.

Warren Buffett has traded his old flip phone for Apple’s iPhone

25 Feb 2020

“Never bet against America.”

Buffett is considered one of the savviest investors anywhere. His fortune of US$72 billion is the fourth-largest in the world, according to Forbes, and in normal years, the company’s annual gathering in Omaha is a high-point of the calendar for investors, a “Woodstock for capitalists”.

But the devastating economic impact of the pandemic has hit hard at Berkshire Hathaway’s wide range of investments, and the need for social distancing forced it to hold the annual meeting online.

Buffett addressed his shareholders in a live-stream flanked only by Gregory Abel, who is in charge of Berkshire’s non-insurance operations.

His business partner for six decades, 96-year-old Charlie Munger, did not appear.

China’s first-quarter GDP shrinks for the first time since 1976 as coronavirus cripples economy
Buffett, in a statement, played down his company’s bleak-looking net figure. He said a better measure of the company’s performance was its operating earnings, which exclude investments and are less subject to sharp fluctuations.
By that measure, Berkshire Hathaway saw growth to US$5.9 billion from US$5.55 billion a year earlier.
The brutal drop in the net – to a loss of US$49.75 billion from a profit last year of US$21.7 billion – resulted primarily from the virus-related decline in value of its broad investment portfolio, which ranges from energy to transport to insurance and technology.
Chinese cryptocurrency billionaire finally sits down to eat with Warren Buffett
7 Feb 2020

The annual meeting often has an almost carnival atmosphere, as thousands of fans and investors flock to Nebraska to hear from the celebrated “Oracle of Omaha”. Buffett, famous for his relatively modest lifestyle, turns 90 on August 30.

In documents filed Saturday, Berkshire noted that until mid-March many of its companies were posting “comparative revenue and earnings increases” over the same 2019 period.

Many of its companies – including in rail transport, energy production and some manufacturing and service businesses – are deemed essential and are able to continue working amid the far-reaching confinement orders.

But their turnover slowed considerably in April, the company statement said.

Moves taken by those companies such as employee furloughs, salary cuts and reductions, and capital spending reductions are “necessary actions” and “temporary,” it said.

Source: SCMP

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