Member Briefing April 28, 2022
500 -Today’s Daily Briefing is the 500th Published by the Council of Industry
We note this milestone with pride and optimism, as well as a tinge of sadness. We remain very proud of all of our members and associate members who do so much good for the region through the darkest days of the the pandemic. We are optimistic that you continue to help shape a better future for your employees, for the region, our nation and the world. And we can’t help but feel sad for the losses experienced by so many in our community over the past 26 months.
Look for 501 on Monday.
COVID 19 UPDATE 1
Posted on Mar. 12, 2020
Over the next few days and weeks we will be using this Blog Page to keep you updated on the impacts of COVID 19 including policy changes, cancellations, best practices and resources. We will let you know when we have updated the page via email, but check back regularly for news related to the virus and Hudson Valley Manufacturers.
New York Court of Appeals Rejects Lawmaker-Drawn Redistricting Maps
New York’s highest court tossed out both congressional and state Senate district maps on Wednesday, ruling that they were drawn “with an unconstitutional partisan intent.”
In a majority 4-3 decision, the state Court of Appeals ruled that the maps must be redrawn by a neutral expert, acknowledging that “it will likely be necessary to move the congressional and senate primary elections to August,” the judges wrote, siding with the Supreme Court.
Invasion of Ukraine Headlines
- Ukraine and Russia: the Latest News – Reuters
- Chinese Drone Maker DJI has Suspended Sales in Both Ukraine and Russia – Fortune
- Russia Bans Hundreds of British Lawmakers – The Hill
- Lawmakers Prepare to Tackle More Aid for Ukraine in Shift to Long-Term Support – WSJ
- Rouble Hits Over 2-Year High vs Euro in Moscow as Russia Halts Some Gas Supplies – Reuters
- Top Gazprombank Executive Flees Russia to Join Ukraine War, For Ukraine – Moscow Times
- Map – Tracking Russia’s Invasion of Ukraine – Live Universal Awareness Map
U.S. Trade Deficit in Goods Jumps 17.8% to Record $125.3 Billion
The U.S. trade deficit in goods widened to a record high in March amid a broad surge in imports, suggesting that trade remained a drag on economic growth in the first quarter. The report from the Commerce Department on Wednesday also showed solid increases in retail and wholesales inventories. But the pace of inventory accumulation was probably not fast enough to provide a boost to gross domestic product growth.
The jump in inventories will offset some of the surprise in the trade deficit, but economists expect to see downward revisions to forecasts for tomorrow’s Q1 GDP report.
New Era of Supply Shocks Risks Years of Inflation Pressure
The decades preceding the pandemic were characterized by chronically weak demand and a seemingly limitless supply of capital, labor and raw materials, resulting in persistently low inflation and interest rates. Those conditions have since flipped. Demand is robust, especially in the U.S., where fiscal and monetary support have been especially generous. Advanced economies report shortages of labor, and Covid-19 continues to snarl supply chains, most recently in China. Meanwhile, Russia’s invasion of Ukraine has triggered widespread shortages of commodities, in particular for food and energy.
Maybe this is a run of bad luck that will be behind us in a year or so. Or maybe it is a prelude to an era in which geopolitical tensions, protectionist policies and natural disasters repeatedly stress the world’s supply networks. Central banks, which spent the last decade fighting off deflationary headwinds, might spend the next battling inflationary headwinds.
US COVID – More Than Half of People in U.S. Likely Had Covid-19, CDC Says
Nearly 60% of people in the U.S., including three in four children, exhibited signs of previous Covid-19 infection as of February, a Centers for Disease Control and Prevention report said. Antibodies from prior infection can be detectable for at least two years after infection, but that doesn’t necessarily mean that those with such antibodies are totally protected against reinfection, Dr. Clarke said.
The estimated proportion of people in the U.S. with detectable, infection-induced antibodies jumped from 34% in December 2021 to 58% by February 2022, according to a study the CDC released Tuesday, highlighting the reach of the winter Omicron surge that washed over the country.
Pfizer Asks FDA to Authorize Booster Shots for Kids Ages 5 Through 11
Children ages 5 through 11 who’ve received two shots of the Pfizer COVID-19 vaccine may soon be eligible for a booster. That’s if the Food and Drug Administration agrees to a request made Tuesday by pharmaceutical companies Pfizer and BioNTech to authorize their booster shot for kids in this age range. The companies submitted data to the FDA showing that the low-dose booster shot is safe for children ages 5 through 11 and could help protect them against omicron. Currently, boosters are only authorized for people ages 12 and older.
The companies say a third shot for younger kids could help counter waning immunity that has left other age groups more vulnerable, especially against omicron, which is better at getting around the immune system.
WHO Says Weekly COVID Deaths Have Dropped to Lowest Level Since March 2020
Deaths caused by COVID-19 have dropped to their lowest levels since March 2020, but World Health Organization Director-General Dr. Tedros Adhanom Ghebreyesus warns that slowing down testing in many countries will hamper the WHO’s ability to track the virus as it continues to mutate and spread.
UNICEF head of global health, vaccines and pandemic response Lily Caprani is calling on developed countries with high vaccination rates to increase vaccination rates in other regions to help prevent the emergence of new variants.
Democrats Launch Attempt to Rescue Biden’s Economic Agenda
Democrats began a last-ditch effort to cobble together a narrower version of President Biden’s once-sweeping economic agenda that could win the critical support of Sen. Joe Manchin (D., W.Va.) and hand the party a legislative victory ahead of the fall’s elections. Democrats see the coming weeks as a critical window to attempt to rescue their waylaid ambitions in the 50-50 Senate.
Mr. Manchin met with Senate Majority Leader Chuck Schumer (D., N.Y.) on Tuesday to discuss the possibility of a party-line package focused on raising taxes and reducing the budget deficit, and he convened a group of lawmakers from both parties on Monday to discuss ways to bolster energy production, another priority for Mr. Manchin.
The Role of the CEO Has Permanently Changed. Here’s What it Will Take to Lead a Company in the Future
Fortune’s Geoff Colvin talked to a plethora of CEOs and their advisers and concluded that the pandemic fundamentally changed corporate leadership. For many CEOs, he writes, the last two years were:
“…the most demanding, most disorienting, most exhausting experience of their careers, and for some the most frightening. Yet history suggests it’s just possible that they may someday remember it with gratitude. The past two years have been a classic crucible experience. It has been painful, and it has forced CEOs to look into themselves more deeply than most people ever do. It has transformed them. Few people seek out a crucible experience. But those who go through one almost always conclude much later, looking back, that it changed them for the better.”
Supply Concerns Drive Natural-Gas Prices Higher
Natural-gas prices swung higher on both sides of the Atlantic on Wednesday after Russia stopped exports to Poland and Bulgaria, a move that investors feared could portend deeper global supply strains ahead. European benchmark prices rose on Wednesday by 4.1% to settle at 107.43 euros, or about $114.28, per megawatt-hour, in a turbulent day of trading. That is well below the peak price European gas reached in March, but still roughly five times as expensive as a year ago.
In the U.S., the benchmark price climbed 6.1% Wednesday to settle at $7.27 per million British thermal units, building on a significant surge that has lifted natural-gas prices from under $4 at the start of the year. Typically, prices decline as spring’s milder weather sets in.
777X Delay, Air Force One Woes Lead to $1.2 Billion Loss for Boeing
Boeing shares were in free-fall early Wednesday after the aviation giant reported a $1.2 billion loss in an ugly quarter weighed down by fresh one-time costs on its Russia business, the Air Force One presidential jet and the new 777X plane. The loss marks the latest round of disappointing results for the commercial jet maker, which has also suspended deliveries of its 787 plane due to a series of production issues.
Offsetting those negatives somewhat has been the improvement in the commercial air market, as well as progress on ramping up deliveries of the 737 MAX, which was grounded for more than a year following two deadly crashes.
GM Sticking to 25%-30% Production Growth Target, Greater Availability of Semiconductors Key
General Motors Corp. Chair and CEO Mary Barra has reiterated the car giant’s 2022 goal of growing vehicle production by 25% to 30% despite ongoing supply chain problems and inflationary pressures. A key to Barra’s optimism is an improvement in the availability of semiconductors, which she and CFO Paul Jacobson told analysts and investors is becoming more reliable and should continue to improve through the second half. On top of that, Barra lauded GM teams’ work to find alternative sources for various other parts and tackle other supply chain the company is facing “on a weekly or almost daily basis.”
GM posted a net profit of $2.9 billion in the first three months of this year, a drop of 3% from the prior-year period. Revenues rose nearly 10% to almost $36 billion even though total vehicle sales fell to 1.4 million from more than 1.7 million in early 2021 while adjusted earnings before interest and taxes slipped 8% to $4.0 billion.
Hudson Valley Bridge Tolls to Increase on May 1st
Tolls on the five bridges in the Hudson Valley that cross the Hudson River will be increasing at midnight on May 1, 2022. The new rates are the third phase of a four-year, phased-in toll revision on the spans operated by the Bridge
Authority. Starting in 2020, the Bridge Authority began an incremental increase in toll rates on May 1 of each
year, with the final phase set to take effect on May 1, 2023.
Passenger cars with E-ZPass, which make up the majority of customers, see an increase of $0.10 each year during the toll revision. The new toll rate schedule was approved in early 2020 after a lengthy public review and regulatory process.
Adjusting: Variable-Rate Mortgage Demand Doubles as Interest Rates Rise
Mortgage rates moved even higher last week, crashing refinance demand and prompting potential homebuyers to apply for riskier loan products which offer lower rates. Total mortgage application volume fell 8.3% last week compared with the previous week, according to the Mortgage Bankers Association’s seasonally adjusted index. Demand is now half of what it was a year ago.
Rising rates are to blame. The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($647,200 or less) increased to 5.37% from 5.20%, with points rising to 0.67 from 0.66 (including the origination fee) for loans with a 20% down payment. That is the highest rate since 2009. The rate was 3.17% the same week one year ago. Buyers are, however, turning more now to adjustable-rate mortgages, which offer lower interest rates. The average rate on a 5-year ARM was 4.28% last week.
SUNY New Paltz Engineering School Senior Design EXPO May 6th
The faculty, staff and students of the School fo Science and Engineering at SUNY New Paltz invite Council of Industry members to attend the Annual Engineering Design Expo May 6th 3:00 – 5:00 p.m. in the Science Hall Lobby. The event is sponsored by Fellow members Elna Magnetics, Central Hudson and Selux. The Expo showcases the talents of some of the brightest students in the Hudson Valley region.
For more information about the EXPO, please contact Rebecca LaVallee 845-257-3784.