Payments Imbalance – Future Komp Mon, 21 Nov 2022 08:45:37 +0000 en-US hourly 1 Payments Imbalance – Future Komp 32 32 UK is already in recession, says UK finance minister 2022 Mon, 21 Nov 2022 08:45:37 +0000

UK is already in recession, UK finance minister says

The much-awaited alternative plan, which includes a tax hike that would affect the country and millions of people, was announced by Britain’s finance minister on Thursday. He warned that Britain appears to be in recession and so the situation is certain to get worse.

As well as outlining the Government’s strategies to rekindle the economic fallout from the shock waves caused by Liz Truss’ predecessor Liz Truss’s cut mini-budget in September, Chancellor Jeremy Hunt presented the Autumn Statement in the House of Commons with the support from the British Prime Minister. Rishi Sunak.

The conflict between Russia and Ukraine has driven up energy prices, which the Independent Office for Budget Responsibility (OBR) says are the main culprits for the fall. Economic expansion is not expected before 2024.

“There are three global crises,” Hunt noted. “The Energy Problem, the Inflation Trigger Condition, and Economic Catastrophe.”

“With the help of our health, safety and necessities strategy in the meantime, we may be able to stay afloat at this time. We are doing it now with British tenacity and sensitivity. The tough choices we make in our strategy will improve government spending, reduce inflation and preserve jobs, he added.

In response to the extraordinary global challenges presented by the outbreak and the Russia-Ukraine crisis, the UK Treasury said the plan it outlined is a targeted package of assistance to those most in need, to reduce debt and spending of the state and to fight against inflation. situation. Combining tax increases with spending cuts, the overall savings to the budget have been estimated at £55 billion.

Due to the lowering of the top corporate tax rate and the freezing of several other taxes, thousands of citizens are expected to pay higher taxes in subsequent years.

Instead of starting at £150,000 as it currently does, the increased rate of 45 pence of income tax will start to be payable at £125,140. The personal exemption and higher rate levels for income tax are maintained for an additional 2 years until April 2028.

The finance minister said he had “made valid points” in his decisions by asking for more contributions from those who have more and thus scrapping tax increases that would “particularly harm development”.

He said the government needed to take ‘tough steps’ to support the economy and promised its strategy would lead to a ‘lesser depression’.

According to the minister, the UK is already in a recession.


Recessions and downturns are both terms used to describe when a country’s economy contracts for two consecutive three-month quarters. Companies often face falling profits, falling wages and high unemployment rates during downturns. As a result, less tax revenue is collected by the government to pay for public services.

Along with protecting pensions, increasing benefits for people who depend on government support to keep pace with inflation, and increasing the windfall tax on the profits of big energy companies, the fall statement also made other relevant announcements. Exemption from paying vehicle excise tax for electric car users will end in April 2025.

The allocation for the National Health Service (NHS) has been increased by £3.3 billion, while an additional £2.4 billion has been allocated to education each year. The government has also declared additional funding for adult protection of £1billion in 2019 and £1.7billion in 2024, for a total of a ‘historic £8billion’ program for the country’s health systems.

From April next year the National Living Pay, or the minimum wage to be provided one way or another to employees, would rise to £9.50 an hour for over-23s at £10.42.

The news was met with a mixed response from financial markets, as the opposing Labor Party condemned the Conservative government for robbing the public at a time when families were already struggling due to the cost of living issue.

She referenced the song ‘Each Breathe You Take’ and added, ‘It’s a recognizable line: every lease they impose, every cut they implement, every tax they impose – conservatives are hurting you.

For the first time since 2008, the British economy is in recession.


The last time the UK experienced a recession was during the 2008 financial crisis, which completely destroyed the global economy.

To MPs gathered in the House of Commons to watch his hour-long economic speech, known as the Autumn Statement, Hunt, the Chancellor of the Exchequer and the 2nd member of the UK Cabinet after Prime Minister Rishi Sunak , made this disturbing statement.

He described the status of the world’s fifth largest economy, which has been badly hit by rising inflation and energy costs. On top of the COVID-19 outbreak and war-induced supply chain disruptions in Ukraine, the last prime minister and her chief economist self-inflicted by offering tax cuts that sent shock waves in the money markets.

To address the roughly $64 billion imbalance in government finances, which economists have dubbed a ‘huge black hole’, Hunt’s suggestions focus on a painful mix of tax increases and spending cuts public.

Share prices in the UK hit their lowest point of the day as the finance minister spoke, but recovered to near levels at the end of trading in London. Nonetheless, the pound fell slightly to trade at 1.17 to the US dollar. Even though the government had hinted at its intentions ahead of the release of the Chancellor’s statement in the hope that the information would not alarm investors, this decline has occurred.

The annual threshold for paying the highest rate of tax, which is 45%, will increase from £150,000 to just over £125,000. Since these and other levels were to be locked in for 2 years, millions of citizens would eventually be forced into higher tax brackets when they earn more money (salaries increase by 5.5% per year , but not at the same rate as inflation, which is 11.1%).

The government, according to Hunt, will maintain the energy price levy that his predecessor Liz Truss enacted, but will increase it slightly from April 2019. Oil and gas companies will also be forced to pay a higher tax. high, called exceptional tax, on their income during the year 2028. This tax will apply to income that will have increased due to the increase in oil and gas prices.

As a result, fiscal policy will be tightened considerably next year, deepening the recession currently in place, according to a study by Samuel Tombs, chief UK economist at Pantheon Macroeconomics. Hunt noted that his proposal would result in “lower energy bills” and “a less pronounced downturn” for the UK.

Edited by Prakriti Arora

UK warehouse operators slam rising corporate tax rates | Retail business Thu, 17 Nov 2022 21:18:00 +0000

The UK warehouse industry has criticized a tax hike on business rates aimed at online retailers such as Amazon as the Chancellor used the levy to ‘soften the blow’ for high street shops.

The government has stated that the measure in Fall statement from Jeremy Hunt Thursday tackled the “bricks-for-clicks fiscal imbalance” by raising the bill for large warehouse rates by 27% and retailer rates by 20%.

Hunt also abandoned plans for a online sales tax on e-commerce giants because of their “complexity”, opting instead for higher tariffs on warehouses operated by companies such as Amazon, DHL and John Lewis’ online store. He barred them from relief while doling out billions to limit the pain of high street retailers, pubs and restaurants.

Clare Bottle, chief executive of the United Kingdom Warehousing Association (UKWA), whose members include Amazon, Coca-Cola, Clipper Logistics and DHL, said the tax increase was “unfair”, “painful” and “disproportionate”. .

According to property adviser Altus Group, the valuation on which Amazon must pay prices for its warehouse in Tilbury, Essex, will rise from £7.1m to £12.3m, an increase of 74%. Supermarkets with food delivery businesses, such as Tesco and Sainsbury’s, are also likely to be affected.

“Warehouses are big buildings and they’re already paying their fair share,” Bottle said, accusing the government of “muddled thinking” and ignoring the low margins made by many warehouse companies.

The warehouse grab has given the government leeway to limit the rise in trade tariffs for many high street retailers, restaurants and pubs. Hunt announced a £1.6bn transitional relief package and £2.1bn relief package for hospitality businesses, expand Covid-19 emergency support.

Tariff bills will fall immediately for businesses whose property values ​​have fallen, rather than the previous gradual reduction, a move welcomed by sectors worried about how they are doing survive the expected recession in the UK.

Kate Nicholls, chief executive of UKHospitality, a lobby group representing hotels, pubs and restaurants, said she was delighted that businesses whose property valuations plummet “will immediately see the benefit on their bills, along with increases will be capped.”

Hunt also announced business tax changes for banks and insurers. radical reforms to UK insurance rules – known as Solvency II – will reduce the amount of capital they have to set aside as safety buffers and allow them to invest money from life insurance and pension policies in a wider and potentially riskier range of assets.

The Association of British Insurers claimed the changes would free up around £100billion over 10 years, money the government hopes to channel into UK investments like infrastructure projects that help with their leveling scheme. However, the reforms do not stipulate that the money should be used to invest in UK projects. Critics, including Liberal Democrats, fear the funds will simply be invested overseas. This could lead to higher returns for insurers, but ultimately would not help Britain’s economic growth plans.

“If the money pledged for collapsing UK hospitals and decaying rail lines ends up flowing overseas, taxpayers will be rightly furious,” said Liberal Democrat Treasury spokeswoman Sarah Olney .

Mick McAteer, a former board member of the Financial Conduct Authority, said the changes would put policyholders at risk because insurers can invest in higher-risk assets and advance expected returns on their accounts, which could make them more profitable than they are now. are.

“This benefits shareholders at the expense of policyholders, who are exposed to the risk that these higher returns will not materialize over time,” McAteer said.

The Treasury also bowed to pressure from the city to cut the surtax on banks next year from 8% to 3%. Some lenders were concerned about a collection exceptional tax by stealthas they reaped the benefits of higher interest rates.

Richard Milnes, UK banking tax partner at accountant EY, said banks would be “particularly relieved” not to face further tax hikes. Banking lobby group UK Finance had warned the Chancellor that the sector would otherwise face “excessive” taxation compared to financial centers such as New York and Dublin.

Europe’s sovereign debt cannot continue to rise indefinitely Tue, 15 Nov 2022 09:10:28 +0000


Time and again, European leaders have pledged to address an imminent threat to their union: excessive public debt. Yet time and time again, events – first the pandemic, now a war-related energy shock – have undermined their plans, compounding the problem.

It can’t last forever. At some point, a major government will probably end up going insolvent. The European Union must be much better prepared than it is.

When divergent economies share a currency without sharing coffers, imbalances invariably arise. German exports and savings, for example, create debts in other countries. A decade ago, such imbalances – coupled with official mismanagement – ​​led to a Greek financial debacle that nearly tore the eurozone apart and imposed suffering on millions of people. But instead of getting to the root of the problem by forming a fiscal union, European leaders reiterated an old pledge: Over time, they would seek to reduce public debt to a safer level.

No chance. Amid emergency spending to mitigate the pandemic and mitigate the effects of energy price volatility, the debt burden has mostly headed in the opposite direction. In 2021, the combined gross debts of eurozone governments amounted to 95% of gross domestic product, up from 86% in 2010 and well above the agreed target of 60%.

So, is another crisis coming? That will depend on whether investors think European governments can control their debt-to-GDP ratio. To some extent, this year’s inflation spurt will help, by increasing the denominator. But rising interest rates will make it difficult to keep the numerator from racing.

Take Italy, with a ratio of 151%. Official projections show that its debt burden will decline significantly over the next decade. But that assumes borrowing costs of only about 2%. If, on the other hand, Italy’s debt rolls over at current interest rates of around 4%, its outlook will be more precarious. Just to keep the debt ratio stable, the government would have to embark on a policy of permanent austerity, maintaining an average primary budget surplus (excluding debt repayment) of nearly 1.5% of GDP – this which, while not unprecedented, would risk provoking popular unrest and harming public opinion. investment. Reducing debt to 60% of GDP, even over two decades, would require larger sustainable primary surpluses than any country has ever achieved.

If at some point the markets decide that Italy’s debt is unsustainable, officials will have only two options: cancel the debt at the expense of private investors or save Italy at the expense of European taxpayers. Under current conditions, the former would likely trigger a financial crisis, as Italian banks are among the biggest holders of their government debt. The second is a political non-starter, especially in relatively well-off countries like Germany.

Ultimately, only a genuine risk-sharing union – in which fiscal transfers compensate for asymmetric shocks – can ensure the long-term viability of the euro. In the meantime, Europe must at least create the conditions for a relatively orderly restructuring of sovereign debt. To this end, policymakers should accelerate the diversification of banks’ holdings away from the debts of their home governments, demand more loss-absorbing capital, and complete banking sector reforms – such as the harmonization of deposit insurance. and streamlining of supervisory authority – necessary to ensure that failures can be dealt with with minimal collateral damage.

Beyond that, Europe needs a sovereign bankruptcy mechanism. The aim should be to ensure that when a government proves unable to pay its debts, losses are imposed on private creditors as quickly and fairly as possible – thus minimizing taxpayer involvement and avoiding the type of series of rescues that have done so much damage in Greece.

As the economist Herbert Stein so aptly said, “if something can’t go on forever, it will stop.” Europe has an interest in being ready.

More from Bloomberg Opinion:

• Central banks have a break but cannot afford to rest: Mohamed A. El-Erian

• India is a bright spot for global oil demand: Javier Blas

• Erdogan’s ego trip undermines NATO: Andreas Kluth

The editors are members of the Bloomberg Opinion Editorial Board.

More stories like this are available at

]]> China’s low birth rate hit by sky-high costs associated with weddings Sat, 12 Nov 2022 16:00:45 +0000

BEIJING — China’s low birth rate issues have been further complicated by high prices demanded for traditional dowries by families of brides. Chinese social media platforms have recently been appalled at the price a groom’s family have been asked to pay, which has even led to the story being censored by authorities.

The engaged couple saw their engagement fall apart after the bride’s family demanded $163,000 for the privilege of marrying their daughter. Due to their lack of financial resources, the couple was forced to separate.

“I always thought excessive bride prices were stories that only existed on the internet until it happened to my own family,” reads the first line of what was one of the most popular articles on the site. The writer’s cousin fell in love with a woman from Jiangxi province.

A Chinese bride in a traditional red wedding dress gazes out over her city before her wedding ceremony.
(Digital Fox News)


The article went viral and received some 22 million hits, with many comments praising the groom and his family for avoiding terrible beautiful family.

People react by having their wedding photos taken near the Forbidden City in Beijing on March 15, 2021.
(REUTERS/Tingshu Wang)

The dowry tradition of giving gifts to the bride’s family has existed for hundreds of years in China, and although a 1950 law prohibits forced marriages and any form of asking for property, the custom is widely held. remained in place.

China’s significant demographic imbalance has been a cause that costs have ballooned. The communist nation ended its one-child policy in 2015 and has since resulted in a surplus of around 34 million men, as many families preferred to have a son rather than a daughter. In many regions, the average bride price can easily be five times the average annual disposable income, and financial pressures have made this a problem for Chinese authorities.


With a population of around 1.4 billion, China continues to be the most populous country in the world. However, with birth rates falling for years, it is estimated to hit an all-time high this year, falling below 10 million from last year’s 10.6 million births. Moreover, China’s fertility rate of 1:16 in 2021 was below the OECD standard of 2:1 for a stable population.

A groom lifts a cloth covering his bride’s face during their traditional Chinese wedding ceremony in Beijing May 15, 2004. Some young people in China are returning to their roots for more traditional weddings and turning away from Western-style ceremonies that had won in popularity.
(REUTERS/Wilson Chu WC)

To combat low growth rates, Chinese authorities have recently introduced numerous measures to encourage couples to have more children, including extended maternity leave and other financial incentives. Beijing has also introduced a 30-day reflection period for couples wishing to divorce. Nevertheless, the will to have more children is among the weakest in the world. According to the Chinese government, excessive bride prices are another obstacle for young people to start starting families.

Recently, local authorities have put in place many rules to limit excessive bride prices. In September, national authorities also decided to intervene when they announced a national testing campaign to “promote a series of standards” and strict regulations on “vulgar standards”. The campaign will last until the end of the year.


An expectant mother Li Zhao, 35, chooses baby products at a store in Beijing October 30, 2015. Li Zhao, a six-month pregnant office worker, said the one-child policy was cruel because aving a baby is a basic civil right. However, she does not want to have a second baby for personal reasons. China has ended its one-child policy, a symbol for decades of invasive and coercive government planning, but the change was met with a disinterested shrug from many young couples.
(REUTERS/Kim Kyung-Hoon)

Reuters recently reported that China’s National Health Commission said COVID-19 also contributed to the decline in the country’s marriage and birth rates.

The Reuters report went on to say that demographers also said that China’s uncompromising zero-COVID policy to quickly eradicate any epidemic with strict controls on people’s lives may have done deep and lasting damage to their desire to have children.


Reuters contributed to this report.

JP Morgan wants to make tenant data accessible to all landlords Fri, 04 Nov 2022 13:20:46 +0000

This series explores surveillance and its intersection with race and civil rights. made possible with support from the Ira A. Lipman Center at Columbia University.

On Monday, JP Morgan Chase announced that it was piloting a new platform called “Story”, an online property management system that allows landlords to manage their portfolio of properties, collect rents, select tenants and view market information, including sale prices and vacancy rates.

This has been touted by the banking giant as a way to modernize rent payments and make them “stress-free” for tenants. Sam Yen, a JP Morgan executive, told Motherboard that this platform is specifically designed to modernize rent payment by completely eliminating paper checks: are still made in paper checks. In discussions with residents, as we questioned them, they said, ‘That’s the only reason I have a checkbook.'”

While a platform like this could make it easier for tenants to pay rent, Story is actually a massive data platform that tenant organizers and privacy advocates say will make it worse. inequality between landlords and tenants and will further reinforce discrimination in housing.

“It’s one thing to just allow tenants to submit rent payments online, these types of platforms aren’t uncommon and that’s something the JP Morgan platform is supposed to help do. But these guys of platforms aim to provide insights to property management companies based on data analytics in a space where there is already an abundance of technologies that make decisions about who gets and keeps access to housing,” Ridhi Shetty, the policy advisor for the Center for Democracy and Technology’s Privacy and Data Project, told Motherboard.

According to a JP Morgan spokesperson, “Story was designed for multi-family owners and operators who operate on a smaller scale, where there aren’t many purpose-built solutions. Many of these businesses are manual and intensive. paper, with competing priorities and limited support. Story can help these operators optimize the way they run their business.” Story will give owners “access to valuable data and insights, including more than 1,500 pieces of curated and original content, and see a holistic, real-time view of their portfolio”.

Specifically, JP Morgan says it will help landlords use data to screen tenants and “analyze markets.” CNBC reported that this includes helping landlords”set rent levels. It’s not hard to imagine a landlord raising rent because JP Morgan data suggests their market can handle it.

“Do these analyzes take into account why someone missed a payment? For example, someone withheld rent because a landlord failed to make repairs or insure a dwelling habitable or has failed to comply with the landlord’s obligations under the existing lease,” Shetty said. “Will this type of information lead the landlord to make changes or improve their own practices to ensure that tenants in the future will be more likely to maintain regular payments because landlords are meeting their obligations? Alternatively, by using rent payment data, landlords can often penalize tenants without correcting the factors that led to these incidents in the first place. There is an imbalance between who is going to benefit from this type of information about data collection.”

According to the 2022 State of the Nation Housing Report set up by Harvard University’s Joint Center for Housing Studies, low-income households and households of color are struggling to pay rents by up to 42% this year. Along with soaring prices for gasoline, food and other basic necessities, insufficient housing supply and higher interest rates, many tenants have been left homeless. The Story tool and similar tools can drive up rental prices without considering why tenants may not be able to send rent payments on time, said Rene Moya, a tenant organizer from the Debt Collective at Motherboard.

“As we know, nationwide, the inability to pay rent is by far the number one reason tenants face eviction. Landlords know and abuse that all the time and automated tools, such that JP Morgan is trying to build and publish, are just one more weapon in the arsenal of landlords, to weaponize this inability and difficulty in paying rent that tenants face,” Moya says. think that kind of innovation, but innovation for landlords is just going to lead to even more instability in the lives of tenants, but a better return on investment for landlords.”

The information Story hopes to provide isn’t new to owners. ProPublica recently investigated a piece of software called RealPage’s YieldStar, which helps landlords price apartments in the United States. RealPage, whose clients include some of the nation’s largest property managers, has been criticized for integrating its clients’ internal rent data into its software, giving landlords an aggregated and anonymous view of what their nearby competitors are charging “. Its algorithm, ProPublica found, was driving up rents, and the company encouraged landlords to leave some apartments vacant in order to raise rents and be more profitable. These tools can therefore be used to prioritize landlord incomes, while exacerbating housing inaccessibility and inequality.

The problem with Story and similar tools is that the power to use them is solely in the hands of landlords, and the vast majority of the benefits go to the landlord as well (meanwhile, tenants get the vaguely marginal benefit of being able to pay his rent online).

“What all of these types of technologies do is bring a ton of clarity and transparency to landlords, but there’s nothing quite like it for tenants. Renters don’t have the kind of ability that landlords have to be able to see what the real state of the rental housing market is. They don’t even know who the true ultimate owners of the buildings they live in are,” Moya said.

In this sense, Story and similar tools are quasi-surveillance tools where tenants obtain a minimum of comfort while giving up a large amount of data that can ultimately be used against them or aggregated with other people’s data to harm tenants as a whole.

“If we could use very basic forms of technology to show who ultimately owns the buildings, what the nominal rents are in those buildings, whether there had been any code violations in the past, all those sorts of things would help tenants to determine for themselves if the building they potentially want to rent is good enough. More importantly, it would help if our municipal officials in different parts of the country could check in and see what kinds of abuses are happening at ground level in our buildings. But there’s no transparent, clear way for tenants to be able to report it or show it to city officials,” Moya said.

Another tool Story is providing landlords with is a tenant screening discount through TransUnion’s SmartMove, which Story says will allow landlords to “proactively manage risk.” SmartMove uses credit reports, criminal records and eviction history in its reports. This type of screening can be very detrimental to the black and Latino communities, which are overrepresented in the criminal justice system and more likely to be deported than other demographic groups. SmartMove also creates a “ResidentScore“, which is a score intended to predict the reliability of a prospective tenant.

Several cities have considering banning this type of algorithm; last year Washington D.C. introduced legislation it “would make it illegal for companies and organizations to use discriminatory algorithms to make decisions about key areas of life opportunity, including education, employment, housing, and public housing and services such as credit, health care and insurance”. Researchers from Dartmouth and Georgetown Law School, meanwhile, Noted that ResidentScore “can perpetuate inequality on the pitch”.

“The Department of Housing and Urban Development has cautioned against using arrest and eviction records, the former because an arrest is not necessarily indicative of a conviction or a reliable predictor criminal behavior, and deportation records can often result from nuisance calls. to law enforcement against people experiencing domestic violence,” Shetty said. “In these cases, using only the arrest record for eviction records without that context will penalize tenants and potential tenants without considering the factors that contributed to the development of this type of data. And that continued to translate into people being denied the opportunity to access housing because of their race, their disability and also their gender identity. All this data without knowing the context in which it was generated will lead to unfavorable decisions regarding current and potential tenants. »

The US Department of Housing and Urban Development has issued guidelines in 2016, which said it was against federal law to refuse to rent or renew a lease based on an individual’s criminal history. In August, a bill was introduced in New York this would restrict the owners’ ability to check applicants’ criminal backgrounds. If this bill passes, NYC would join a number of cities, including San Francisco and Chicago, in preventing landlords from checking candidates’ criminal records. However, history continues to list these reports as part of its offerings to owners.

“There are ways to harness technology to improve the lives of tenants,” Moya said. “Instead, what we’re seeing is technology being harnessed to automate inequities for renters, especially at a time when their cost of living is being squeezed by massive rent increases.”

This article is part of Monitoring status, made possible by a grant from the Ira A. Lipman Center for Journalism and Civil and Human Rights at Columbia University, in conjunction with Arnold Ventures. The series will explore the development, deployment and effects of surveillance and its intersection with race and civil rights.

]]> Better protections for Kiwis using Buy Now, Pay Later Wed, 02 Nov 2022 01:52:00 +0000

Better controls to prevent vulnerable consumers from ending up in Buy Now, Pay Later (BNPL) debt traps are on the way, the Minister for Business and Consumer Affairs, Dr David Clark, announced today.

“It’s the right thing to do. As the global cost of living crisis puts pressure on New Zealanders and their families, we are taking action to help them avoid unmanageable debt, especially as the Christmas season approaches,” said David Clark.

“While for many BNPL can be a useful way of spreading the cost of large household purchases, we try to prevent vulnerable people from going into debt if lenders allow them to take on more than they can afford. .

“The BNPL sector is clearly a grassroots innovation. The amount spent with BNPL in New Zealand rose to $1.7 billion in 2021 from $755 million in 2020. That’s why we need to make sure these products and the companies that offer them serve consumers well. and that they can be held responsible. »

The government has agreed affordability checks should apply to BNPL loans above a certain threshold (proposed at $600), meaning borrowers will enjoy the same kind of protection as borrowers using other credit agreements – such as credit cards and personal loans. Options on how affordability checks should be done will be consulted.

Small loans, below the threshold limit, will not have to go through the same process, but full credit reports will have to take place.

All suppliers will be required to have hardship processes in place and adhere to a dispute resolution system. Directors and senior officers will also need to be certified fit and proper by the Commerce Commission.

“We will strike the right balance between protecting consumers and enabling continued access to low-cost credit by applying the Consumer Credit Agreements and Finance Act 2003 (CCCFA) in a proportionate way,” said David Clark.

The Department for Business, Innovation and Employment (MBIE) aims to begin consultation on the details, including a proposed $600 threshold and what will apply above the threshold, later this year . Final regulations are expected to be established in 2023.


/Public release. This material from the original organization/authors may be ad hoc in nature, edited for clarity, style and length. The views and opinions expressed are those of the author or authors.View Full here.

AFC Gamma: Interesting speculation with high yield (NASDAQ: AFCG) Sun, 30 Oct 2022 14:19:37 +0000


It’s been a while since I wrote an article on the AFC Gamma (NASDAQ:AFCG). Since May, the stock has been pretty much cut sideways (while paying two quarterly dividends of $0.56), but I thought it was high time I wrote an update on this cannabis. Mortgage REIT.

Investment thesis

AFCG is a small cap lender focused on the cannabis industry. Due to regulatory complexity and uncertainty, they are one of the few publicly traded companies that operate in the space. Because of this, they are able to get double digit returns on their portfolio. This leads to a hefty dividend yield of 13.1% as the company pays almost all of its profits to shareholders. One of the red flags that investors should be aware of is external management, but I think this is offset by significant insider ownership. They also intentionally targeted limited license jurisdictions, which I believe reduces the risk of the loan portfolio. Despite the risks and complexity of the market, the imbalance between supply and demand for capital in the cannabis industry should lead to attractive returns for AFCG.


AFCG operates in a space that most financial institutions have avoided by lending to cannabis companies. Due to regulatory complexity, AFCG can guarantee significant returns on its loan portfolio. The cash interest rate on the portfolio is 11.8% based on the most recent investor presentation, and the yield to maturity is 18% after taking into account various fees. Although I consider AFCG a more speculative bet than REITs like Innovative Industrial Properties (IIRP) or NewLake Capital Partners (OTCQX: NLCP), I still like the risk/reward proposition.

The AFCG is betting on two things: a continued mismatch between the supply and demand of capital available to the cannabis industry and investors who continue to seek revenue opportunities. As long as the legalization effort remains stalled, the capital available to the industry will be limited. This should give cannabis REITs looking to step in and fill this gap with attractive opportunities, whether on the real estate side for IIPR and NLCP or on the lending side for AFCG and Chicago Atlantic Real Estate Finance (REFI).

Insider ownership, external management and portfolio strategy

The company has significant insider ownership, so management should have an incentive to maintain dividends as it continues to grow the loan portfolio. However, AFCG is externally managed, which most REIT investors consider a red flag. In a previous disclosure they included language on how they could internalize management once they reach a certain size, but I still see external management as a downside.

AFCG loan map

Loan portfolio map (

They continued to avoid unlimited license states, which is a prudent choice in my opinion. While some states have chosen to go in different directions with legalization and regulation, and this has its pros and cons, licensing in limited license jurisdictions can be a valuable safeguard if a business is not able to meet its obligations.

At present, this does not appear to be an issue for AFCG, which said in the latest earnings call that all borrowers are up to date with their interest payments and no loans are unaccounted for. . We have seen tenant issues with IIPR in the last quarter, so it may become an issue for AFCG in the future. While worth watching by investors, the AFCG is currently trading around book value as of the end of the second quarter.


At the end of the second quarter, AFCG’s book value was $17.03, down one penny from the prior quarter. I think we’ll probably see stocks stay fairly close to book value, but I’m curious to see what book value will be with the upcoming Q3 report. As a relatively young public company, AFCG does not have a long operating history, but as an investor, I would like to see the book value grow over the long term with the dividend. As a mortgage REIT, most of AFCG’s return will be driven by the juicy dividend which has seen impressive dividend growth since its IPO.

The dividend

In my last post, the AFCG had offered investors juicy dividend increases for several consecutive quarters. Since then, there was a token rise of a penny in Q2, then the dividend was flat at $0.56 in Q3. I won’t increase my position unless the stock price drops even further, but I expect the company to at least maintain the dividend over the next year. They only have a few loans maturing in 2023 and this is a relatively small part of their portfolio of around $15 million. I don’t count on further increases, but the dividend yield now sits at 13.1%, which is attractive. I plan to continue to reinvest dividends unless we see a significant increase in the stock price.


My speculative position within the AFCG is small due to cannabis industry risks and regulatory complexity. However, with stocks trading close to book value, I think we will see attractive returns driven by the large dividend. The company has impressive returns on its loan portfolio, and the portfolio is expected to continue to grow over the next two years. External management is something to consider, but the insider ownership and limited licensing strategy for the portfolio makes me bullish on AFCG. Investors who understand the risks associated with the industry might consider AFCG and its hefty dividend.

Hundreds of Thousands of Scammed Workers Reimbursed Record $532 Million Sun, 23 Oct 2022 20:55:00 +0000

The Fair Work Ombudsman (FWO) has recovered a record $532 million from employers detention rights of their employees during the previous financial year – three times higher than the previous year.

Wages went to 384,805 underpaid employees in Australia who had paychecks, pensions and benefits withheld, and who were paid under their award rate.

The FWOs Annual Report published at the end of last week showed a fourfold increase in salaries recovered since the previous year.

Watch the latest news on Channel 7 or stream for free on 7plus >>

There were 137 new disputes filed in fiscal year 2021-22, an increase of 80% and the first time more than 100 disputes were filed with FWO in a single year.

More than half of the record sum recovered by FWO came from large corporate employers, who had to reimburse nearly $279 million to more than 267,000 employees. This figure is six times higher than the previous year.

Also in 2021-22, the FWO launched action against two of the country’s largest employers, the Commonwealth Bank of Australia and Coles Supermarkets, over alleged underpayments, with both cases still in Federal Court.

Coles and the Commonwealth Bank of Australia are both involved in legal proceedings launched by the Fair Work Ombudsman. Credit: AAP

Migrant workers were found to have been exploited in a large number of cases.

“The agency obtained approximately $2.7 million in court-ordered fines, of which approximately $1.8 million came from cases involving exploited migrant workers,” FWO said.

“These workers may be vulnerable because they are often unaware of their rights at work or may be reluctant to speak up.

Fair Work Ombudsman Sandra Parker said employers must “put compliance first”.

“All employers must prioritize having systems in place and getting the guidance they need to ensure they are paying workers their legitimate entitlements,” she said.

“Those doing the wrong thing, including big business, are caught – and we don’t hesitate to take enforcement action where appropriate.”

seek advice

Not all wages had to be recovered through legal proceedings – thousands of compliance notices were also issued by the regulator, with recoveries increasing by 23%.

It also settled 18,622 workplace disputes between workers and employers.

Many Australians have asked for advice on rights and an action plan to reclaim these benefits, with 350,000 customer inquiries by phone and digital channels, and 27 million visits to access information online.

This information includes how often an employer is legally required to provide a payslipwhat should be on this payslip and how to solve the problem, as well as detailing industry reward rates.

Where wage theft is a crime

Wage theft was criminalized in Victoria in 2020 in a bid to hold employers to account.

Under legislation that takes effect in 2021, employers who dishonestly withhold wages, pensions or other entitlements from employees could be fined up to $198,264 for individuals, $991,320 dollars for businesses and up to 10 years in prison.

Employers who make mistakes in good faith or exercise due diligence in paying wages and fees are not guilty under the laws.

In Queensland in 2020, wage theft has also been reclassified as theft under the criminal code, and now Queensland employers who deliberately underpay their workers could be jailed for up to 10 years or fined close to $1 million under new state laws.

In March of this year, a Senate report titled Systemic, sustained and shameful, found that a “vicious circle of underpayment” had broad economic repercussions and drove down wages across the board.

He said employers were using a power imbalance to disadvantage their workers, with women and First Nations people more likely to suffer.

“There is a direct link between precarious work and underpayment, reflecting the power imbalance between employers and workers, and workers’ fear of speaking out or seeking redress for fear of losing their jobs,” says The report.

He found that wage theft, including withholding pension rights, created a downward economic spiral and impacted people’s pensions, with taxpayers having to foot the bill in the form of increased pension payments. pension.

But he found the current penalties to be “not in line” with community expectations, with only civil penalties available for wage theft.

-With PAA

Kanye West is suing the Melbourne burger bar that opened as a tribute.

Kanye West is suing the Melbourne burger bar that opened as a tribute.
You want to buy silver at $18, says silver market analyst and author Peter Krauth Thu, 20 Oct 2022 20:18:00 +0000

Editor’s Note: With such volatility in the markets, stay up to date with daily news! Get our quick roundup of today’s must-see news and expert opinion in minutes. Register here !

(Kitco News) – There is a significant disconnect in the silver market between paper and physical bullion investment demand, and this is an environment where profits are made, according to a market analyst.

Silver appears to be building a solid bottom between $17 and $18 an ounce, and while markets may remain volatile in the short term, current prices represent long-term value, said Silver Stock newsletter founder Peter Krauth. Investor and author of a recently published book, The Great Silver Bull.

Krauth added that he sees $18 an ounce as strong long-term support for silverwhich represents the all-inclusive average sustaining costs for silver producers.

“When silver hits $18, you should definitely buy,” he said. I don’t see it going down for long, because that would further upset the supply and demand imbalance in the market,” he said in an interview with Kitco News.

Krauth’s bullish outlook for silver comes as the precious metal has come under heavy selling pressure for most of 2022 and has significantly underperformed gold as fears of recession weighed on industrial demand. Rising interest rates, pushing the US dollar to its highest level in 20 years

However, Krauth added that despite weak investment demand, silver’s fundamentals have not changed as the precious metal continues to be a vital part of the ongoing global transition to green energy. He added that the imbalance of supply and demand was acutely felt among physical investors forced to pay record premiums for bullion because there was not enough supply.

“Low investment demand doesn’t change the fundamentals of money. It just adds to the sharp disconnect and it’s in these types of markets that you find the best investment opportunities,” he said. -he declares. “We know from history and experience that when the silver market remediates and corrects, it happens very, very quickly.”

Krauth added that while investors have been disappointed with short-term price action this year, the precious metal has made impressive gains. He pointed out that from mid-2018 to mid-2019, silver was trading below $15 an ounce.

He added that while silver has been volatile since the COVID-19 pandemic, the average price for the past three years is above $22 an ounce, up nearly 40% from the previous three-year average in 2017. to 2019.

As investor interest ebbs and flows, Krauth noted that industrial demand continues to see steady growth. Analysts expect more than 100 million ounces of silver to be consumed in the solar energy sector this year.

“The world will not be able to meet its green energy goals without silver. Industrial demand will only continue to grow, and that creates a rising floor for silver prices,” he said. he declares. “Silver has become a critical and replaceable metal.”

As for what will bring investors back to the market, Krauth said bond yields and the U.S. dollar need to stop rising. The yield on 10-year bonds pushed above 4%, reaching its highest level since 2008; at the same time, the US dollar continues to trade near its highest level in more than 20 years. Krauth pointed out that these assets represent significant competition with silver.

However, he added that markets are starting to see the end of the Federal Reserve tightening cycle early next year and when that happens investors sitting on the sidelines will step in. Krauth said he sees silver prices returning to the low $20 range by mid-year and to the high $20 range by the end of next year.

“We’ll look back and see the current price as a bargain,” he said.

For investors looking to build a silver portfolio, Krauth said they should hold 10% in physical metal, 50% in large silver producers and royalty streamers, 20% in developing producers looking to build mines, and 20% in junior explorers.

“When you look at equities, you don’t have to take huge risks in your portfolio; there are a lot of senior producers out there who are having exceptional returns,” he said. “Like physical metal, mining stocks have been so battered that there is a lot of value in the market.”

Disclaimer: The opinions expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure the accuracy of the information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. This is not a solicitation to trade commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article accept no responsibility for loss and/or damage resulting from the use of this publication.

Harvard Medical Researchers Discover Surprising Pain Protective Properties Sun, 16 Oct 2022 15:36:06 +0000

Researchers at Harvard Medical School have analyzed molecular crosstalk between pain fibers in the intestine and the goblet cells that line the walls of the intestine. The work shows that chemical signals from pain neurons prompt goblet cells to release protective mucus that coats the gut and shields it from damage. The results show that gut pain is not just a sensing and signaling system, but plays a direct protective role in the gut. Credit: Chiu Lab/Harvard Medical School

What if pain was more than just an alarm bell?

New research in mice sheds light on how pain neurons protect the gut from damage.

Pain is one of evolution’s most effective mechanisms for detecting injury and letting us know something is wrong. It acts as a warning system, telling us to stop and pay attention to our bodies.

What if pain was more than just a warning sign? What if pain was in itself a form of protection?

A new study by researchers at Harvard Medical School suggests that this may well be the case in mice.

The startling research reveals that pain neurons in the mouse gut regulate the presence of protective mucus under normal conditions and stimulate gut cells to release more mucus during states of inflammation. The study was published on October 14 in the journal Cell.

The work describes the steps in a complex signaling cascade, demonstrating that pain neurons engage in direct crosstalk with intestinal mucus-containing cells called goblet cells.

Goblet cells come from pluripotent stem cells and get their name from their cup-shaped appearance that resembles a goblet. Their main function is to secrete mucin and create a protective layer of mucus. Goblet cells are also thought to play a role in regulating the immune system.

“Pain turns out to be able to protect us in more direct ways than its typical job of detecting potential damage and sending signals to the brain. Our work shows how pain mediating nerves in the intestine communicate with nearby epithelial cells that line the intestines,” said study lead researcher Isaac Chiu. “This means that the nervous system plays a major role in the gut beyond just giving us an unpleasant feeling and is a key player in maintaining the gut barrier and a protective mechanism during ‘inflammation.” Chiu is an associate professor of immunobiology at the Blavatnik Institute at HMS.

A direct conversation

Our intestines and respiratory tract are dotted with goblet cells. Named after their cup-shaped appearance, goblet cells contain gel-like mucus composed of proteins and sugars that acts as a protective coating that shields the surface of organs from abrasion and damage. The new research found that intestinal goblet cells release protective mucus when triggered by direct interaction with pain-sensing neurons in the gut.

In a series of experiments, the researchers observed that mice lacking pain neurons produced less protective mucus and experienced changes in their gut microbial composition – an imbalance between beneficial and harmful microbes known as dysbiosis.

To clarify how much of this protective crosstalk occurs, the scientists analyzed the behavior of goblet cells in the presence and absence of pain neurons.

They found that goblet cell surfaces contain a type of receptor, called RAMP1, that ensures the cells can respond to adjacent pain neurons, which are activated by food and microbial cues, as well as mechanical pressure, chemical irritation or drastic temperature changes. .

The experiments further showed that these receptors connect to a chemical called CGRP, released by nearby pain neurons, when the neurons are stimulated. These RAMP1 receptors, the researchers found, are also present in human and mouse goblet cells, making them sensitive to pain signals.

Experiments have further shown that the presence of certain gut microbes activates the release of CGRP to maintain gut homeostasis.

“This finding tells us that these nerves are triggered not only by acute inflammation, but also initially,” Chiu said. “Just having regular gut microbes seems to tickle the nerves and cause the goblet cells to release mucus.”

This feedback loop, Chiu said, ensures that microbes signal to neurons, neurons regulate mucus, and mucus keeps gut microbes healthy.

In addition to microbial presence, dietary factors also played a role in activating pain receptors, the study showed. When the researchers gave mice capsaicin, the main ingredient in red chili peppers known for its ability to trigger intense, sharp pain, the mice’s pain neurons were quickly activated, causing the release of copious amounts protective mucus by goblet cells.

In contrast, mice lacking pain neurons or goblet cell receptors for CGRP were more susceptible to colitis, a form of intestinal inflammation. This finding could explain why people with gut dysbiosis may be more prone to colitis.

When the researchers administered pain-signalling CGRP to animals that lacked pain neurons, the mice experienced a rapid improvement in mucus production. The treatment protected the mice against colitis even in the absence of pain neurons.

The finding demonstrates that CGRP is a key instigator of the signaling cascade that leads to the secretion of protective mucus.

“Pain is a common symptom of chronic inflammatory bowel conditions, such as colitis, but our study shows that acute pain also plays a direct protective role,” said study first author Daping Yang. postdoctoral researcher at Chiu Lab.

A possible downside to pain suppression

The team’s experiments showed that mice lacking pain receptors also had more severe lesions from colitis when it occurred.

Since painkillers are often used to treat patients with colitis, it may be important to consider the possible adverse consequences of pain blocking, the researchers said.

“In people with bowel inflammation, one of the main symptoms is pain, so you might think we would want to treat and block pain to relieve suffering,” Chiu said. “But part of this pain signal could be directly protective as a neural reflex, raising important questions about how to carefully manage pain in a way that doesn’t lead to further harm.”

Additionally, a class of common migraine medications that suppress CGRP secretion may damage gut barrier tissue by interfering with this protective pain signaling, the researchers said.

“Given that CGRP is a mediator of goblet cell function and mucus production, if we chronically block this protective mechanism in people with migraine and they take these drugs long term, what is it happening?” Chiu said. “Will the drugs interfere with people’s mucosa and microbiomes?”

Goblet cells have several other functions in the intestine. They provide a passageway for antigens – proteins found on viruses and bacteria that trigger a protective immune response by the body – and they produce antimicrobial chemicals that protect the gut from pathogens.

“A question that arises from our current work is whether pain fibers also regulate these other goblet cell functions,” Yang said.

Another avenue of research, Yang added, would be to explore disruptions in the CGRP signaling pathway and determine whether dysfunctions are at play in patients with a genetic predisposition to inflammatory bowel disease.

Reference: “Nociceptor Neurons Direct Goblet Cells Through a CGRP-RAMP1 Axis to Drive Mucus Production and Gut Barrier Protection” by Daping Yang, Amanda Jacobson, Kimberly A. Meerschaert, Joseph Joy Sifakis, Meng Wu, Xi Chen, Tiandi Yang, Youlian Zhou, Praju Vikas Anekal, Rachel A. Rucker, Deepika Sharma, Alexandra Sontheimer-Phelps, Glendon S. Wu, Liwen Deng, Michael D. Anderson, Samantha Choi, Dylan Neel, Nicole Lee, Dennis L. Kasper, Bana Jabri, Jun R Huh, Malin Johansson, Jay R. Thiagarajah, Samantha J. Riesenfeld and Isaac M. Chiu, October 14, 2022, Cell.
DOI: 10.1016/j.cell.2022.09.024

Co-authors included Amanda Jacobson, Kimberly Meerschaert, Joseph Sifakis, Meng Wu, Xi Chen, Tiandi Yang, Youlian Zhou, Praju Vikas Anekal, Rachel Rucker, Deepika Sharma, Alexandra Sontheimer-Phelps, Glendon Wu, Liwen Deng, Michael Anderson, Samantha Choi, Dylan Neel, Nicole Lee, Dennis Kasper, Bana Jabri, Jun Huh, Malin Johansson, Jay Thiagarajah and Samantha Riesenfeld.

The work was supported by the National Institutes of Health (grants R01DK127257, R35GM142683, P30DK034854, and T32DK007447); the Food Allergy Science Initiative; the Kenneth Rainin Foundation; and the Digestive Diseases Research Core Center under P30 grant DK42086 to the University of Chicago.

Jacobson is an employee of Genentech Inc.; Chiu sits on the Scientific Advisory Boards of GSK Pharmaceuticals and Limm Therapeutics. His lab receives research support from Moderna Inc. and Abbvie/Allergan Pharmaceuticals.