PM lifts US beef ban, paves way for Trump tariff talks
A government source, speaking on condition of anonymity, insisted the move, which was communicated to the US government overnight Wednesday (AEST), was based on scientific advice following a review of the restrictions initiated more than 18 months ago, before Donald Trump was elected president for a second term.
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Sydney Morning Herald
43 minutes ago
- Sydney Morning Herald
Firing people can't save Trump from the US economy's unflattering reality
In response, a group of statistical agencies that goes by the name The Friends of the Bureau of Labour Statistics released its own, more factual, statement that read: 'This escalates the President's unprecedented attack on the independence and integrity of the federal statistical system. The President seeks to blame someone for unwelcome news,' it said. It's also worth noting that the group statement was issued by William Beach, who was McEntarfer's Trump-appointed predecessor at the bureau. It's hard to overstate what Trump has done. Imagine if Anthony Albanese decided to sack the nation's chief statistician because the latest inflation data was not what the government wanted. There would, rightly, be an outcry. Naturally, the Trump apologists have been out defending the indefensible, ignoring the fact that the bureau has always revised job numbers (up and down), no matter the occupant of the White House. Last year, while Joe Biden was still in office, the bureau revised its jobs figures between January and July down by 340,000. But the single largest downward revision came in March and April 2020, during the early months of the COVID-19 pandemic, when the number of jobs was cut by almost 925,000. Loading Revisions are part and parcel of what the Bureau of Labour Statistics does. Every month it updates its numbers as it receives more information. The monthly release, plus the revisions, are vital to policymakers (like the Federal Reserve) and investors so they can see how the economy is travelling in as close to real time as possible. Ever since he declared a record crowd at his 2017 inauguration, Trump and reality have been at odds. In the grand scheme of things, crowd size does not really matter. But using a Sharpie to extend the expected landfall of a hurricane, gutting agencies responsible for tracking climate change, and ignoring employment data have very real consequences. Economists and policymakers have, for years, been worried about the statistics coming out of nations where the political leaders meddle with the numbers. In Argentina during the 1990s, the government fired bureaucrats who released less-than-flattering inflation figures and began releasing their own (sound familiar?). Understandably, this made international investors wary and increase their premiums as protection. By 2001, the government was in a full-blown debt crisis and defaulted on $US93 billion of debt. Greece, Turkey, Russia and China have also tried to play fast and loose with statistics over the years. It got to such a point in the case of China that outside economists used electricity consumption or satellite pictures taken at night (to see artificial light) as a de facto measure of GDP because their trust in the official numbers was so low. As financial analyst Ned Davis told The Wall Street Journal, ' Your initial thought is, 'Are we heading toward what you see in Latin America or Turkey, where if the data doesn't look good, you fire someone, and then eventually stop reporting it?'' Just a few days before McEntarfer's sacking, Trump was saying how great the economy was travelling – and demanding the Federal Reserve cut interest rates because it was going so well. Of course, the GDP figures did not show that (growth is slowing while inflation, at 2.7 per cent, is above the Fed's 2 per cent target rate). But Trump couldn't admit that, so he told his own story. Loading Around the same time, the president claimed that his government had cut pharmaceutical prices by '1200, 1300, 1400, 1500 per cent. I don't mean 50 per cent, I mean 1400, 1500 per cent'. And he's the one who thought the Bureau of Labour Statistics was making up numbers. The problem with making up your own numbers, or installing people who will make the numbers show what you want, is that they will be at odds with the lived experience of voters. Just as Biden struggled to convince Americans that the cost of living was getting better while they could see the price of everyday essentials going up, saying the economy is great to people lining up for unemployment benefits has a short shelf life. There's an adage used by economists to describe the models they use to understand the economy: Put crap in, and you get crap out.
Sydney Morning Herald
43 minutes ago
- Sydney Morning Herald
ASX set to slide, Apple rally leads Wall Street higher; $A stronger
Wall Street is rising on Wednesday, led by a rally for Apple. The S&P 500 was 0.7 per cent higher in afternoon trading. The Dow Jones Industrial Average was up 145 points, or 0.3 per cent, in mid-afternoon trade, and the Nasdaq composite was 1.1 per cent higher. Apple alone accounted for nearly half of the S&P 500's gain. It rose 5.7 per cent ahead of an announcement at the White House where it was announced the tech giant will increase its US investments by an additional $US100 billion ($153.7 billion) over the next four years. The Australian sharemarket is set to retreat, with futures at 4.55am AEST pointing to a fall of 27 points, or 0.3 per cent, at the open. The ASX gained 0.8 per cent on Wednesday. The Australian dollar gained. It was 0.5 per cent higher at US65.05¢ at 5.14am. Trading elsewhere on Wall Street was mixed following a jumble of profit reports. McDonald's and Shopify rose following their latest updates, while Super Micro Computer tumbled after its earnings and revenue came in below analysts' expectations. Disney fell after its earnings beat forecasts but its revenue fell short. Loading Worries are still high that President Donald Trump's tariffs may be hurting the economy, but hopes for coming cuts to interest rates by the Federal Reserve and a parade of stronger-than-expected profit reports from US companies have helped steady the market. Companies are under pressure to deliver bigger profits to justify the big gains their stock prices have made since the US market hit a low point in April. The S&P 500 is just a bit below its record, which was set late last month, and the big rally fuelled criticism that the broad market has become too expensive. McDonald's climbed 3.4 per cent after reporting stronger profit and revenue for the spring than analysts expected. A meal tied to the Minecraft movie proved to be a hit for the restaurant chain.
Sydney Morning Herald
43 minutes ago
- Sydney Morning Herald
Chalmers needs to show some courage to help save Australian economy
For the first Albanese government timidity resulted in another bite of the cherry. But, unfortunately, caution is lingering as a second-term hallmark, despite a massive landslide that gave Labor open slather to effect wide-ranging change. This month's Economic Reform Roundtable should have been the vehicle for substantial reform. But, amid the Productivity Commission recommendations for tax reform, unions calling for curbs on negative gearing, the capital gains discount and the use of family trusts, business groups railing against too much change and suggestions that the transition from fossil fuels to renewables be speeded up, the government appears to have lost some chutzpah. A day after Prime Minister Anthony Albanese talked down the roundtable's significance, Treasurer Jim Chalmers also started hosing down expectations, sending a clear message around parliament: excited observers should curb their enthusiasm. Beginning on August 19, the three-day Economic Reform Roundtable aims to build consensus on ways to improve productivity, enhance economic resilience and strengthen budget sustainability in the face of global uncertainty. It brings together a mix of leaders from business, unions, civil society and government. Some 900 submissions have been received and anticipations of change were running high. But the Herald' s chief political correspondent Paul Sakkal said cabinet had become concerned about the huge expectations stoked, and the summit is expected to produce a handful of policies to which Chalmers would immediately commit. Speedier approvals for energy projects, cutting red tape and new incentives for home building were seen as quick wins with wide support from warring unions and business lobbies. More significant changes that gain support from assorted experts, captains of industry and unions will be put off for further examination. The roundtable was already seen at risk of becoming a Canberra gabfest. But tax will undoubtedly be the elephant in the room, given Albanese's refusal to consider changing the GST, a veto that is already tying one of the government's hands behind its back. The exclusion of those major players in taxation and deregulation, states and territories, is another handicap. For a summit considering Australia's economic future, ignoring the GST seems blinkered, especially as economist Richard Holden and independent MHR Kate Chaney suggested to the Herald 's Shane Wright that a 15 per cent GST could deliver a $28 billion boost to government coffers while providing an annual $3300 rebate to all Australians as an offset. However, almost all other taxes are on the table. The Productivity Commission has proposed a company tax cut for smaller businesses, while larger companies pay more. New visions are required in a world where old certainties are quickly fading, and the one reality is that productivity is key to meeting future challenges. That said, courage and big ideas – including controversial reform of the GST – will help drive the Australian economy, not the risk aversion displayed by a Labor government too afraid for, or of, its own mandate to act for the greater good.
