Talks to end GM strike take 'turn for the worse,' UAW says - CBC.ca

Talks for a new four-year labour contract between General Motors Co. and its striking workers cooled Sunday after the United Auto Workers (UAW) rejected the largest U.S. automaker's latest offer.

GM made an offer to the union that basically repeated one that the UAW had previously rejected, said Terry Dittes, the UAW vice-president in charge of the GM department, in a letter to members. The union provided a copy of the letter to Reuters.

"These negotiations have taken a turn for the worse," he said.

"We, in this union, could not be more disappointed with General Motors," Dittes said. "The company has shown an unwillingness to fairly compensate … the UAW."

In a statement, GM said it continues to negotiate in good faith "with very good proposals that benefit employees today and builds a stronger future for all of us."

The company said it is committed to talking around the clock to resolve the dispute.

Impasse linked to new products

Dittes said the UAW made an offer to GM on Saturday that covered wages, signing bonuses, job security, profit-sharing and other issues. GM responded on Sunday morning with its counteroffer, he said, which "did nothing to advance a whole host of issues."

Dittes also sent a sharp letter to GM's vice-president for labour relations Sunday, saying: "You didn't even have a professional courtesy to explain why you could not accept, or why you rejected, our package proposal for each item we addressed."

A person briefed on the talks said Sunday that the union voiced concerns about GM increasing production in Mexico, where it now builds pickup trucks, small cars and two SUVs. The person, who spoke on condition of anonymity because the talks are private, said both sides are far apart on guarantees of new products in U.S. factories.

GM officials previously said the Detroit company's labour rates are the highest in the industry and it needs the ability to build some vehicles in other markets to keep costs down.

The sides have been meeting daily since the GM strike began on Sept. 16.

Canadian layoffs, solutions promised

The strike means about 2,000 workers have been on temporary layoff since Sept. 20 at GM's assembly plant in Oshawa, Ont. They were on a line that makes Chevrolet Impalas and Cadillacs. Nearly 700 workers were handed temporary layoff notices the same day at the GM propulsion plant in St. Catharines, Ont.

Just before the strike began, GM revealed that its offer to the UAW included plans to invest more than $7 billion US in its U.S. plants over the life of the deal.

GM also said it had "solutions" for the Lordstown, Ohio, and Detroit assembly plants that it had previously said would cease making vehicles. Sources said at the time that those plans included a battery plant in Ohio and building an electric truck in Detroit.

Analysts estimate the strike has cost GM more than $1 billion US, while LMC Automotive estimated on Thursday that GM has lost production of 118,000 vehicles through Oct. 2.

Industry analysts say GM is losing more than $80 million US a day as the strike continues. Workers earn $250 per week in strike pay while they're on the picket lines, about one-fifth of what they normally make.

Wages and pensions are among the issues that remained unsettled.

Striking workers have said they want a bigger share of the more than $30 billion US in profits that GM has made during the past five years. But the company wants to cut its labour costs so they are closer to those at U.S. factories run by foreign automakers, mainly in the south.

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October 07, 2019 at 12:14AM

UAE telecom du sees no evidence of ‘security holes’ in Huawei's 5G technology: CTO - Reuters

FILE PHOTO: A Huawei company logo is pictured at the Shenzhen International Airport in Shenzhen, Guangdong province, China July 22, 2019. REUTERS/Aly Song

DUBAI (Reuters) - United Arab Emirates (UAE) telecoms company du saw no evidence of security concerns about Huawei’s 5G technology, the company’s chief technological officer Saleem Albalooshi told Reuters on Sunday.

“Huawei is our partner in rolling out our 5G network... From a security perspective.. we have our own labs in the UAE and we visit their labs... we have not seen any evidence that there are security holes specifically in 5G,” Albalooshi said.

Washington has been warning allies against using the Chinese company’s equipment, which it says presents a security risk.

Huawei has repeatedly denied the U.S. allegations, which were raised earlier this month during a visit by Federal Communications Commission Chair Ajit Pai to Saudi Arabia, the United Arab Emirates, and Bahrain, all of which use Huawei equipment.

When asked about U.S. threat that it will stop intelligence-sharing with nations that use Huawei equipment, Alabooshi said it is a concern.

“Of course, this is definitely a concern.. but such a thing is the government’s decision. We follow our government’s roads and we are governed by the regulator,” he said.

Reporting by Tuqa Khalid

Our Standards:The Thomson Reuters Trust Principles.

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October 06, 2019 at 08:24PM

HSBC to cut up to 10,000 jobs in drive to slash costs: FT - Reuters

FILE PHOTO: A man walks past a logo of HSBC at its headquarters in Kuala Lumpur, Malaysia August 6, 2019. REUTERS/Lim Huey Teng/File Photo

(Reuters) - HSBC Holdings Plc (HSBA.L) is planning to cut up to 10,000 jobs as interim Chief Executive Officer Noel Quinn seeks to reduce costs across the banking group, the Financial Times reported on Sunday.

The plan represents the lender’s most ambitious attempt in years to cut costs, the newspaper said, citing two people briefed on the matter. It said the cuts will focus mainly on high-paid roles.

HSBC could announce the beginning of the latest cost-cutting drive and job cuts when it reports third-quarter results later this month, the FT said, citing one person briefed on the matter.

Quinn became interim CEO in August after the bank announced the surprise departure of John Flint, saying it needed a change at the top to address “a challenging global environment.”

Flint’s exit was a result of differences of opinion with chairman Mark Tucker over topics including approaches to cutting expenses, a person familiar with the matter told Reuters in August.

The reported job cuts come after the lender said it would be laying off about 4,000 people this year, and issued a gloomier business outlook with an escalation of a trade war between China and the United States, an easing monetary policy cycle, unrest in its key Hong Kong market and Brexit.

HSBC declined to comment.

Reporting by Shubham Kalia in Bengaluru; Editing by Peter Cooney and Daniel Wallis

Our Standards:The Thomson Reuters Trust Principles.

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October 07, 2019 at 03:21AM

CARGOLIFT CONUNDRUM: Liberal cargo plane inefficient 1960s-era gas guzzler - Toronto Sun

It’s a fine example of late 1960s aviation technology — hard at work helping Justin Trudeau earn his second term as prime minister.

The Liberal leader raised eyebrows earlier this week after admitting his campaign consists of a second airplane — a Boeing 737-200 cargo freighter chartered from Montreal-based Nolinor Aviation — prompting Conservative Leader Andrew Scheer to label Trudeau a “climate hypocrite” during the French language debate on Oct. 2.

Manufactured in 1975, the aircraft spent most of its life with Aer Lingus in Ireland before being purchased by Nolinor in 2017.

Considered one of the least efficient and worst polluting airliners in current service, the 737-200 was among the first generation of Boeing’s venerable 737 family of narrow-body airliners.

The 737-200 was manufactured in 1966 and 1988, and only 58 remain in service today — largely by charter companies and airlines in developing nations such as Zimbabwe, Democratic Republic of the Congo and Central African Republic as they’re the only airliner still capable of taking off and landing on gravel airstrips.

Technical specifications for the 737-200 list a 4,899 kilometre range and, according to data provided by Nolinor, the craft burns an average 3,691 litres of fuel per hour with its Pratt & Whitney JT8D engines, introduced on the Boeing 727 in 1962.

Trudeau’s primary plane — a next-generation 737-800 chartered from Air Transat — has a published range of 7,400 km and consumes nearly 500 less litres of fuel per hour than the 200.

Liberal Leader Justin Trudeau boards his campaign plane in Ottawa on Sept. 29, 2019. Ryan Remiorz / The Canadian Press

Using publicly available data from flight tracking websites, the Sun determined the Liberal’s cargo plane embarked on 35 trips between the beginning of the campaign on Sept. 11 and Oct. 4. logging over 27,000 km — nearly three-quarters the circumference of the earth.

While the plane’s longest flight was Sept. 19 between Halifax and Saskatoon — 3,239 km — many of the trips were under 200 kilometers.

The shortest flight was a 31 km hop between Mirabel — Nolinor’s home airport — and Montréal–Trudeau on Oct. 3.

That came a day before another series of short flights — 233 km from Montréal–Trudeau to Quebec City, 313 km to Mont-Joli a few hours later, 675 km to Ottawa International that evening, followed almost immediately by a 136 km return to Montréal-Mirabel by 8:30 p.m.

On Sept. 25, the plane departed Vancouver at 12:30 PDT on a 3,100 km flight to Sudbury ahead of his infamous ‘canoe’ campaign stop.

Federal Liberal leader Justin Trudeau canoes around Lake Laurentian during a campaign stop at the Lake Laurentian Conservation Area in Sudbury, Ont. on Thursday, Sept. 26, 2019. (John Lappa/Postmedia Network) John Lappa / Postmedia Network

After landing in Sudbury, the plane almost immediately took off again for Peterborough, Ont., a 327 km trip south.

The plane departed for Sudbury at 12:10 p.m. the next day, returning to Peterborough about two hours later.

It then flew to Toronto on the 27th — an 18 minute, 118 km hop.

Other short flights include Charlottetown to Halifax on Sept. 18 (160 km), five trips between Mirabel and Ottawa (136 km), and a 12 minute, 62 km journey from Toronto Pearson to Hamilton.

Advances in aviation over the past few decades, says Asia Times aviation journalist D.M. Chan, have largely concerned reducing weight and improving fuel efficiency.

“Engines are far, far better,” he told the Sun, particularly between modern aircraft and those built prior to the 1970s oil crisis.

“They’re more efficient, not to mention quieter.”

Winglets, a relatively new innovation on commercial airliners intended to reduce wake turbulence behind aircraft, have resulted in significant fuel savings for airlines, Chan said, describing the savings from flared or curved wingtips equalling about 10 billion gallons of jet fuel — or a global emissions reduction of over 105 megatons of CO2.

The Toronto Sun contacted the Trudeau campaign requesting specific details about the plane’s short trips — specifically regarding the multiple flights between Sudbury and Peterborough.

Liberal party spokesperson Pierre-Olivier Herbert dismissed the Sun’s inquiries as a “ridiculous distraction” and criticized the Conservative Party for not purchasing carbon credits during the campaign.

The Trudeau campaign has promised to offset emissions during their campaign by purchasing carbon credits.

bpassifiume@postmedia.com

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October 06, 2019 at 10:11AM

The Trumponomics experiment is failing before our eyes - Business Insider

President Donald Trump at a tour of an advanced manufacturing lab in Iowa in 2018.AP

• Economic data is pointing toward a recession, and no one should be surprised.
• Yes, it's late in our economic cycle, and that matters. But President Donald Trump's policies are also very much to blame here.
• Trump promised to buck economic thought and go full protectionist. Economists warned him this would damage the global economy, but he didn't listen.
• Feel free to walk by the White House and scream "I told you so!"
• Visit Business Insider's homepage for more stories.

When Donald Trump became the 45th president of the United States, he promised to launch an economic experiment.

Ignoring the past few decades of economic liberalization, multilateralism, and openness, Trump promised to close the economy, renegotiate our trade deals nation by nation, and refocus the US economy on a relatively small sector, manufacturing, which makes up less than 20% of the economy.

To some, that experiment was a refreshing turn from the steady plod toward globalization that Americans have experienced for the past 50 years. To others — especially to economists — this was folly.

Protectionism, as experts well know, is bad news. They reminded Trump that steel tariffs have only brought the US pain — but Trump slapped them on our allies anyway. He was warned about his tax policies; about disrupting the North American Free Trade Agreement, our trade deal with Canada and Mexico; about ripping up the Trans-Pacific Partnership, a major trade deal forged by the Obama administration and supported by members of both parties; and about confronting China alone. But Trump did it all anyway.

And so the world found out what happens when the most powerful country in the world takes 100 years of economic knowledge and flushes it down the toilet. Experiment, on.

Voila, America

Here we are, three years into the Trump administration's experiment, with a recession rapping at the door of the US economy. How do we know?

• The pesky yield curve keeps inverting, showing us that investors are worried about what's around the corner for the US economy.
• For the first time in a long time, Wall Street waited with bated breath for one number, from the ISM services survey, which told us that 80% of the US economy had slowed to levels unseen since 2016.
• The services contraction came amid manufacturing's slump, which has been with us since last year and just reached its lowest point since 2009.
• People have lost interest in buying big-ticket items like washing machines.
• Chief financial officers across the country are feeling gloomier than they have in three years.

Deutsche Bank

Employment numbers remain strong — though hiring is slowing — and consumer confidence remains somewhat steady. But allow me to remind you that those are lagging indicators. When a recession comes, the consumer is the last to know.

Running with scissors

Recessions are cyclical; that's a fact. But there are things you can do to hasten them, and the Trump administration has done all it can to do that. His policies have basically been the economic equivalent of running at breakneck speed with a pair of very sharp scissors.

Trump ran on a platform of ignoring the rules of economics and turning personal grievances into policy. Now we know what that can do to the mightiest economy on the planet.

Trade wars have disrupted agriculture and manufacturing, ripping up supply chains and costing the government billions in aid. Erratic policies have spooked Wall Street and exhausted and frustrated our allies. The world is now a place where the United States cannot be trusted, and that is a world where growth is slower. Just about every respectable economist in the game told Trump this would happen, but he and his allies didn't want to hear it.

So now we're here, in a moment that the World Trade Organization says could produce "a destructive cycle of recrimination." When there is no trust between counterparties in markets and everyone gets desperate, there can be unintended consequences. Monetary and fiscal policies will shift as countries try to get used to a world growing more slowly, and this could, the WTO said, "destabilize volatile financial markets" and "produce an even bigger downturn in trade."

Sometimes rules are rules for a reason.

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2019-10-06 12:01:09Z
52780402567699

World's Best-Run Pension Funds Say It's Time to Start Worrying - Yahoo Finance

(Bloomberg) -- Back in 2012, the world’s best-managed pension market was thrown a lifeline by the Danish government to help contain liabilities. That was when interest rates were still positive.

Seven years later, with rates now well below zero, even Denmark’s $440 billion pension system says the environment has become so punishing that it may be time for a change in European rules.

Henrik Munck, a senior consultant at Insurance & Pension Denmark, an umbrella organization, says the way liabilities are currently calculated “could cause a negative spiral” that forces funds to keep buying low-risk assets, drive yields lower and the value of liabilities even higher.

The warning comes as pension firms across Europe struggle to generate the returns they need to cover their growing obligations. In Denmark, some funds saddled with legacy policies guaranteeing returns as high as 4.5% have had to use equity to meet their obligations.

To calculate liabilities, pension firms use a complex mathematical formula constructed by the European Insurance and Occupational Pensions Authority (EIOPA). The formula is intended to shield funds from erratic market swings that artificially inflate or hollow out balance sheets. But with negative rates more entrenched, there are signs the EIOPA curve, as it’s called, may not be working as intended.

“When pension funds across Europe de-risk simultaneously, it may actually become pro-cyclical: it increases the price movements, and it could result in yet more downward pressure on the EIOPA yield curve, exacerbating the problem,” Munck said.

The curve is comprised of several elements. Its backbone -- the euro interest-rate swap curve -- has sunk since its implementation about four years ago, driving up the value of liabilities.

Sinking Swap Rates

The European Commission has started reviewing the regulatory framework around insurers -- Solvency II -- with a view to proposing improvements by the end of next year. Insurance Europe, an industry group, is urging the commission to address the curve in its evaluations.

In the meantime, pension funds have been coping by buying up riskier assets. The Dutch, ranked with Denmark as the world’s best performing pension providers by Mercer, have complained to the European Central Bank about the fallout on the industry.

And Then...

And then there’s the headache of what’s called the volatility adjustment (VA), which is set on a country-by-country basis and is designed to cushion the impact of erratic markets. According to Bloomberg Intelligence senior analyst Charles Graham, there’s “widespread” agreement that VA is “flawed.”

“It is something that EIOPA is considering recommending changing, but the challenge is still what to replace it with, or how to fine tune it,” Graham said.

Earlier this year, EIOPA unexpectedly slashed Denmark’s VA to roughly a third its previous level, causing considerable alarm in the industry.

According to Anders Damgaard, the chief financial officer of Denmark’s biggest commercial pension fund, PFA, which has about $100 billion in assets, EIPOA’s reason for the adjustment made sense: The new VA incorporates call options that let Danish borrowers buy back the bonds that fund their mortgages. The long-term covered bonds to which those call options are attached are a cornerstone of Danish pension funds’ investment portfolios.

With interest rates at unprecedented lows, a record number of borrowers are now taking advantage of those call options to refinance their mortgages. Damgaard says the way EIOPA calculates the volatility adjustment means the very device that’s intended to mute market swings has itself become more volatile. Worse, because it’s “an artificial number,” pension funds can’t hedge it, he says.

“That’s really where the main challenge is for us,” Damgaard said. “We have an unhedgeable component of the yield curve -- which is actually active on the entire yield curve -- and you can’t hedge it, which means that the balance sheet posts are very volatile.”

PFA, like many Danish pension funds, started scaling back guaranteed products for retirees many years ago. That’s given it a buffer to help absorb some of the shock of growing liabilities. But not everyone’s as well prepared. “If the discount curve is more volatile and you can’t hedge it, you can -- if you don’t have enough capital -- be forced to lower risk on the more hedgeable space, to compensate,” Damgaard said.

Olav Jones, deputy director general of Insurance Europe, says the pension industry “does not see any need to change the way the risk-free curve is generated, but there is a need to improve how the VA is generated.” Right now, it’s “generally too low and generally leads to liabilities that are inflated” and creates artificial volatility in insurers’ balance sheets, he said.

To contact the reporter on this story: Frances Schwartzkopff in Copenhagen at fschwartzko1@bloomberg.net

To contact the editors responsible for this story: Tasneem Hanfi Brögger at tbrogger@bloomberg.net;Paul Sillitoe at psillitoe@bloomberg.net

For more articles like this, please visit us at bloomberg.com

©2019 Bloomberg L.P.

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2019-10-06 08:13:32Z
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World's Best-Run Pension Funds Say It's Time to Start Worrying - Bloomberg

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World's Best-Run Pension Funds Say It's Time to Start Worrying  Bloomberg
https://www.bloomberg.com/news/articles/2019-10-06/world-s-best-run-pension-funds-say-it-s-time-to-start-worrying

2019-10-06 04:00:00Z
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