US Treasury Secretary: Fed needs to be examined as an institution
Speaking on US business news channel CNBC on Monday, Bessent was asked whether he thinks President Donald Trump should fire Fed Chair Jerome Powell.
The treasury secretary said, "I think that what we need to do is examine the entire Federal Reserve institution and whether they have been successful."
Bessent has been critical of monetary policies that the Fed has implemented. His remarks are seen as an indication that the Fed policies, including those in the past, also need to be examined.
Regarding the impact of the Trump administration's tariff policy, Bessent said, "there was fear mongering over tariffs, and thus far, we have seen very little, if any, inflation."
He expressed the belief that a rate cut is possible, saying "We've had great inflation numbers."
It is rare that a US Treasury Secretary refers to the need to examine the Fed, which is supposed to be independent of the government.
Bessent was apparently trying to pressure the central bank to cut interest rates.
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Japan Times
an hour ago
- Japan Times
U.S. alcohol sector prepares to fight back against buzzy cannabis drinks
Top alcohol makers have been sitting on the sidelines of a cannabis beverage boom, watching brands in the fast-growing category like Cann and Wynk make deals with beer and booze distributors and gain valuable space on liquor store shelves. Now some alcohol companies, seeing their sales falter, are laying the groundwork to potentially enter the lucrative but risky market, a dozen founders of cannabis brands, ingredients suppliers and drinks manufacturers said. Drinks containing THC, the mood-altering ingredient in marijuana, are restricted to licensed dispensaries in 24 U.S. states where recreational use of pot is legal. But small amounts of THC can also be extracted from hemp, a crop that's related to marijuana but is legal federally. Beverages containing THC derived from hemp can be sold in many liquor shops, convenience stores and supermarkets. That's where Big Alcohol sees opportunity, despite some companies having been burned by past cannabis investments. Corona brewer Constellation Brands has been internally researching hemp-based cannabis drinks to weigh its next steps, a source familiar with the company's thinking said. Absolut Vodka distiller Pernod Ricard has met with Brez, maker of drinks with THC derived from hemp, as recently as last month to discuss a possible investment, Brez's founder Aaron Nosbisch said. "They did not invest now but are circling," Nosbisch said. Corona brewer Constellation Brands has been internally researching hemp-based cannabis drinks to weigh its next steps. | Reuters Pernod declined to comment on the meeting. Constellation Brands said it does not comment on rumors and speculation. Alcohol makers are still suffering a hangover following America's pandemic drinking binge, when sales spiked as cash-flush consumers splurged on pricey bottles of liquor for their homes, and then rushed back to bars when lockdown restrictions lifted. Alcohol sales have been falling ever since as inflation and interest rates rose and wallets became stretched. The companies also now face growing warnings from public health authorities who say drinking even small amounts of alcohol is associated with at least seven types of cancer. Overall U.S. beer volumes fell nearly 6% through May of this year, according to the Beer Institute. Volumes of spirits and wine sold in the same time period have declined by 5.6% and 9%, respectively, according to the Wine & Spirits Wholesalers of America. In a sign of tumult in the industry, the CEO of the world's biggest alcohol maker, Diageo, stepped down last week as the company struggles to revive growth. But hemp-based drinks are expanding fast. The market for drinks infused with THC from hemp is projected to top $1 billion in sales this year, according to market research firm Euromonitor, and climb past $4 billion in 2028. Molson Coors CEO Gavin Hattersley said in January he'd be naive to say THC beverages aren't having an effect "at least in a small way." Tilray Brands, the fourth-largest U.S. craft brewer with brands including Montauk and Shock Top, is selling its new hemp-derived THC seltzers through its beer distributors such as United Distributors in Georgia, executives said in an interview. The company's THC drinks are for sale in 13 states. "There's not a real leader that's taken a hold of the (market) so far, and that's what we look to do," Tilray's CEO Irwin Simon said earlier this year. Others, including Heineken's Lagunitas brand and Pabst Blue Ribbon, the fifth-largest U.S. brewer, have lent their names to THC seltzers for sale in dispensaries in California. Lagunitas is looking to grow distribution of its THC seltzer, potentially using hemp, to other states, a representative from Cannacraft, its ingredient supplier, said. A spokesperson for Lagunitas said it has no immediate plans to expand, but monitors market development and looks for opportunities as consumer tastes and regulations change. Boston Beer, the maker of Samuel Adams, is one of the brewers with the clearest path to eventually enter the U.S. cannabis drinks market, although it has not provided a time frame for doing so. The company is already selling its Teapot brand of THC-infused tea in Canada where weed is legal, and in the last year tested a potential U.S. version made from THC derived from hemp. To test the reformulated product, a panel of trained sensory experts sampled Teapot with both THC from hemp and marijuana, and could not taste a difference, said the company's head of cannabis, Paul Weaver. "This is a source of growth for our organization, flat out," Weaver said. Big Alcohol is treading carefully in cannabis drinks because state and federal regulations have shifted, and could change again, said five executives at ingredients suppliers and THC beverage brands. California, which has legal weed, banned hemp-based drinks last year to try to prevent children from consuming them. Other states have introduced special taxes or restricted sales, ambiguity that has held alcohol companies back from entering the market. Sen. Mitch McConnell, who helped first legalize hemp in 2018 to support farmers in his home state of Kentucky, in July introduced a provision in a government spending bill that could ban intoxicating products using the plant. McConnell wrote in an op-ed published in the Louisville Courier Journal on July 17 that his efforts are aimed at keeping THC gummies that look like familiar candies out of the hands of children. He did not provide comment beyond the op-ed. Big brewers have been burned by past cannabis investments. In 2022, the biggest U.S. brewer Anheuser-Busch inBev exited a deal with Tilray to research cannabis drinks in Canada. The same year, Molson Coors shuttered its U.S. business selling beverages infused with CBD, a compound in marijuana and hemp that does not have psychoactive effects, citing an uncertain regulatory environment. Constellation Brands restructured its investment in Canadian cannabis company Canopy Growth last year after poor sales. Now, however, hemp-based THC drinks are sold widely. Beyond beer's declining sales, brewers face an additional squeeze from tariffs, which threaten to push up prices for imported drinks, and Hispanic consumers, who are staying home due to fears of U.S. immigration enforcement. Liquor stores are embracing the buzzy beverages to boost their margins as the drinks, typically more expensive than a six-pack of beer, start to outsell other types of alcohol. Jon Halper, CEO of Minnesota liquor store chain Top Ten Liquors, said in June that THC beverages now make up 15% of his business after the company introduced them two years ago. By next year, they could grow to rival wine, currently in the mid-20% of his sales, he said. The drinks take shelf space mostly from beer because they are in coolers, Halper said. The margins on cannabis beverages are higher than those for beer and spirits, helping his firm offset softening alcohol sales. Charleston, South Carolina-based Southern Horizon Logistics, a sister company of Budweiser distributor Southern Crown Partners, is now selling more hemp-based drinks than wine and spirits, said Justin Ashby, the company's chief administrative officer. Ryan Moses, CEO of Nashville, Tennessee-based beer, wine and spirits distributor Best Brands, said that growth from THC-infused drinks has helped offset flat and declining alcohol sales. Instead of possible layoffs, Moses has been able to re-allocate employees to the new category. "It could be as big as the other categories five to 10 years from now," Moses said. Consumers like Josh Goldberg, 39, of Lindenhurst, New York, are also trading out beer and tequila for THC seltzers. Goldberg made the switch almost two years ago, and hasn't had a drink since. "It replaces the physical act of drinking with drinking something else," Goldberg said. Halper, the owner of Minnesota liquor stores, said the customers buying THC-infused drinks tend to skew female and over the age of 35. "The soccer mom has really embraced the category in a big way," Halper said.
Japan Times
4 hours ago
- Japan Times
Japan expects only 1% to 2% of $550 billion U.S. fund to be investment
Japan expects only 1% to 2% of its recently agreed upon $550 billion U.S. fund to be in the form of actual investment, with the bulk of it being loans, according to the nation's chief tariff negotiator, Ryosei Akazawa. At the same time, Tokyo would save roughly ¥10 trillion ($68 billion) through lower tariff rates in its deal with America, he said. The $550 billion investment framework will be a combination of investments, loans and loan guarantees provided by financial institutions backed by the Japanese government, Akazawa said on public broadcaster NHK on Saturday night. Of the total, investment would be worth 1% or 2% and the United States and Japan would split the profits of that investment at a ratio of 90-to-10, he said. Japan had originally proposed a 50-50 ratio, he added. The fund is a centerpiece of the deal announced by the two sides that will impose 15% tariffs on Japanese cars and other goods. But the details given by Akazawa suggest the Japanese may end up giving up much less than at first glance. The comments come as officials from countries with deals with the U.S. sift through the terms to explain to the public what they entail. "It's not that $550 billion in cash will be sent to the U.S.,' Akazawa said. "By letting the U.S. have 90% of the profits rather than 50%, I think Japan's loss will be at most a couple of tens of billions of yen. People are saying various things, such as 'You sold out Japan,' but they're wrong.' For the loans provided through the program, Japan will simply be collecting the interest payments, and for the loan guarantees, if nothing happens Japan will also be just collecting fees, Akazawa said. "For that part, Japan's just making money,' he said. Akazawa also clarified that the investment program won't be only supporting Japanese and U.S. firms. As a potential example, he cited a Taiwanese semiconductor firm building a factory in the U.S. "We'd like to put the $550 billion in place during President (Donald) Trump's term,' Akazawa added. Further details of the implementation of the U.S.-Japan deal remain unclear including when the new tariff rates would take effect and when the new investment vehicle would kick off. There's been no joint document signed by both sides for the deal, although the White House has published a fact sheet. "If you say something like, 'Let's create a joint document,' they will say, 'We'll lower tariffs after the document is created,'' Akazawa said. In order to not lose time, "we will demand that they issue an executive order to lower tariffs as soon as possible, regardless of a document.' Last week, Akazawa said he expects universal tariffs on Japan's shipments to be lowered to 15% on Aug. 1, while he said he wanted the car tariffs to be cut to 15% as soon as possible without specifying a date. The Trump administration has touted the deal with Japan as a potential model for others. On Sunday, the U.S. and European Union agreed on a deal that will see the bloc face 15% tariffs on most of its exports with the EU pledging to invest $600 billion in the U.S.
NHK
5 hours ago
- NHK
More than 20% of NASA employees opt to leave agency: US media
US media outlets say nearly 4,000 employees have applied to leave the NASA space agency under a program by President Donald Trump's administration to cut federal spending. CBS News and other media have reported that 3,870 staff, or over 20 percent of NASA's workforce, have applied to leave. The agency employs about 18,000 people. The reports said the deadline for applications for the deferred resignation program was on Friday. The Trump administration says NASA will face a 24-percent year-on-year reduction in the budget for the fiscal year that begins in October. About 360 current and former employees of the agency published an open letter on Monday last week to voice their opposition to the spending cuts. The "Voyager Declaration" says, "The last six months have seen rapid and wasteful changes which have undermined our mission and caused catastrophic impacts on NASA's workforce."
