September 4 2024

1. U.S. Immigration Wave Reshapes Labor Force
2. Markets Tumble as Manufacturing Weakness Spooks Investors
3. Post-Pandemic Travel Boom Plateaus
4. Election roundup
5. Volkswagen Considers First-Ever Factory Closures in Germany
Sports: U.S. Open Men’s Final Will Feature First American in 18 Years
9/4/476 Western Roman Empire collapses

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1. U.S. Immigration Wave Reshapes Labor Force

The U.S. is experiencing its largest immigration wave in generations, driven by millions of people from around the world seeking personal safety and economic opportunity. Immigrants are swelling the population and changing the makeup of the U.S. labor force in ways that are likely to reverberate through the economy for decades. Since the end of 2020, more than nine million people have migrated to the U.S., after subtracting those who have left, coming both legally and illegally, according to estimates and projections from the Congressional Budget Office. That’s nearly as many as the number that came in the previous decade. Immigration has lifted U.S. population growth to almost 1.2% a year, the highest since the early 1990s. Without it, the U.S. population would be growing 0.2% a year because of declining birthrates and would begin shrinking around 2040, the CBO projects.   

Article Source: WSJ

2. Markets Tumble as Manufacturing Weakness Spooks Investors

The Dow Jones Industrial Average lost 626 points and Nasdaq slumped 3.3% after data out Tuesday showed signs of weakness in the manufacturing sector. ISM's purchasing managers' index came in lower than expected for August, and remained in contraction. S&P Global's PMI also stayed in contraction, while construction-spending data showed a bigger-than-expected decline. Major U.S. indexes finished the session with their worst day since Aug. 5, when concerns about slowing economic growth sparked a global market rout.

Article Source: WSJ

3. Post-Pandemic Travel Boom Plateaus

Revenge travel after the darkest days of the pandemic contributed to travel roaring back across the globe, with airlines, hotels and cruises reporting double-digit growth and travelers using their savings, taking on debt or even selling their homes to splurge on bucket list adventures or multiple trips. Now, at least for some travelers, that furious vacation spending is slowing down. While high-income travelers are still booking luxury experiences and jet-setting abroad, other consumers have been cutting back on travel spending to meet the high cost of living. Data from Tourism Economics (on behalf of the U.S. Travel Association, a travel group) shows that the meteoric rise in post-pandemic travel spending that began in 2021 has reached a plateau. In earnings calls this month, top hotel chains like Hilton and Hyatt reported less demand by leisure travelers for lower-priced brands, while online travel agencies, like Expedia Group and Booking Holdings, and short-term rental companies like Airbnb also noted slowdowns.

Article Source: NYT

4. Election roundup

Harris TV ad blitz 

The Harris campaign will begin a massive advertising blitz on Tuesday, spending $170m on television spots in battleground states and a further $200m on streaming platforms like YouTube and Spotify. According to the campaign, it will be the biggest such spend by “any political organisation ever”. Ms Harris certainly has the cash—she has raised over $500m since becoming the Democratic Party’s candidate in August.

Ed note: do TV ads matter anymore?  

Beware of election forecasts

Even as Joe Biden’s presidential candidacy teetered and polls showed him clearly losing to Donald Trump, the election forecasting site 538 was still estimating that Biden was likeliest to win. It was a conclusion based on odd modeling assumptions that led the site’s original founder, Nate Silver, to declare the 538 model “very obviously broken” and for the site’s new chief to acknowledge an adjustment to its model when it relaunched with Kamala Harris’ candidacy. The episode is notable not just for the skirmishing between rival forecasters — but because it revealed how little value should be placed in these projections at all. Statistical models that aggregate polling data and use it to estimate the probability of each candidate winning an election have become extremely popular in recent years. Proponents claim they provide an unbiased projection of what will happen in November and serve as antidotes to the ad hoc predictions of talking-head political pundits. And of course, we all want to know who is going to win. But the reality is there’s far less precision and far more punditry than forecasters admit. 

Harris small business policy 

Vice President Kamala Harris will propose a tenfold-expansion of a tax deduction for new small businesses and announce a goal of 25 million new small-business applications in her first term if elected president, according to campaign officials. 

US Steel: politics vs reality 

U.S. Steel’s chief executive said the company would close steel mills and likely move its headquarters out of Pittsburgh if its planned sale to Nippon Steel collapses. CEO David Burritt said that the nearly $3 billion that Japan-based Nippon Steel has pledged to invest in the Pittsburgh company’s older mills is critical to keeping them competitive and maintaining workers’ jobs. “We wouldn’t do that if the deal falls through,” Burritt said in an interview. “I don’t have the money.” Burritt’s dour outlook for the storied steelmaker came after Democratic presidential nominee Kamala Harris said Monday that U.S. Steel should remain domestically owned and operated. President Biden, Republican presidential nominee Donald Trump and several members of Congress have similarly lined up against the $14.1 billion deal, which the United Steelworkers union also opposes. Xxx

Article Source: Economist, POLITICO; WSJ

5. Volkswagen Considers First-Ever Factory Closures in Germany

Volkswagen AG is considering factory closures in Germany for the first time in its 87-year history, parting with tradition and risking a feud with unions in a step that reflects the deep woes roiling Europe’s auto industry. After years of ignoring overcapacity and slumping competitiveness, the German auto giant’s moves are likely to kick off a broader reckoning in the industry. The reasons are clear: Europe’s efforts to compete with Chinese rivals and Tesla Inc. in electric cars are faltering.

Antiestablishment populism is on the rise in Europe, fueled not just by migration and economic and security fears, but by a deeper trend: Eroding confidence in governments’ ability to overcome those challenges. In Germany on Sunday, the far-right AfD and a new far-left populist party obtained almost half the votes cast in the eastern state of Thuringia, and together also took more than 40% in neighboring Saxony. In Thuringia, the AfD finished first, the first time a far-right movement has won a state election in postwar Germany. In France, a legislative election that returned a hung parliament and gave the far-right National Rally almost a quarter of all seats—up sharply from the last election—has yet to yield a government two months later. A litany of crises, from immigration to inflation and the war in Ukraine, has helped populists notch up electoral wins from Italy to the Netherlands and from Sweden to Finland in recent years. For some pollsters and analysts, however, crises are nothing new. What is new is voters’ crumbling confidence that elected governments can solve them.

Article Source: Bloomberg, WSJ

Sports: U.S. Open Men’s Final Will Feature First American in 18 Years

A U.S. man will again play in the U.S. Open men’s final. Guaranteed.  It hasn’t happened in 18 years—not since a headbanded Roger Federer thumped a baseball-capped Andy Roddick in four sets at Arthur Ashe Stadium in 2006. Of course, let’s give plenty of love to Roddick, because he’s also the last U.S. man to capture a major of any kind, in 2003, when he won this same, rowdy New York City tournament. (Roddick’s 2009 Wimbledon finals loss to Federer is the last time a U.S. men’s player reached a major final of any kind.) On Tuesday, the American pros Taylor Fritz and Frances Tiafoe each won their quarterfinal matches, ensuring they will meet each other in the men’s semifinals on Friday. The winner will take a place in Sunday’s final—with a chance to redeem a couple of meandering decades for U.S. men’s tennis.

Article Source: WSJ

9/4/476 Western Roman Empire collapses

Sources

1. https://www.wsj.com/economy/how-immigration-remade-the-u-s-labor-force-716c18ee?st=avs69kpg0b903i8&reflink=article_copyURL_share

2. https://www.wsj.com/livecoverage/stock-market-today-dow-sp500-nasdaq-live-09-03-2024

3. https://www.nytimes.com/2024/08/30/travel/travel-demand-cheap-flights.html?smid=nytcore-ios-share&referringSource=articleShare

4. Economist; https://www.politico.com/news/magazine/2024/09/03/election-forecasts-data-00176905?nname=playbook-pm&nid=0000015a-dd3e-d536-a37b-dd7fd8af0000&nrid=c564e993-5468-4c61-8278-38966999b02e&nlid=964328; https://www.wsj.com/politics/elections/kamala-harris-to-propose-expansion-of-small-business-startup-tax-deduction-50fcb696?st=jcqf604bsgj1n7v&reflink=article_copyURL_share; https://www.wsj.com/business/u-s-steel-warns-of-plant-closings-if-sale-collapses-4ef45756?st=27ulha6molp4r19&reflink=article_copyURL_share

5. https://www.bloomberg.com/news/features/2024-09-02/vw-weighs-factory-closures-as-china-targets-europe-s-ev-blunders; https://www.wsj.com/world/europe/europes-populist-surge-isnt-only-about-immigration-it-is-about-fading-trust-a3caff0d

6. https://www.wsj.com/sports/tennis/us-open-francis-tiafoe-taylor-fritz-212a3cb6?st=gqwxcmhnztvc9o1&reflink=article_copyURL_share