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US slaps anti-dumping duties on Chinese pipe fittings

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China is hurting U.S. manufacturers of cast iron soil pipe fittings by “dumping” its products on the American market, the Commerce Department said on Wednesday in announcing it will collect cash deposits from importers of the fittings.

The department said it preliminarily found that Chinese exporters have sold the fittings in the United States at 68.37 percent to 109.95 percent less than fair value and that in 2016 imports of the fittings from China were valued at an estimated $8.6 million. It will issue a final determination on June 27.

The highest “dumping rate” came from Sibo International Limited, according to the Commerce Department, which has put a duty on the company’s fittings of 109.79 percent.

President Donald Trump’s administration has made protecting U.S. manufacturers a priority and since Trump took office has initiated 94 investigations into unfair subsidies and dumping, where a company exports products at artificially low prices.

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Rent controls are becoming a highly divisive issue in Europe

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In front of the criminal court in Moabit, supporters of a left-wing housing project in Köpenicker Straße protest against its eviction. A woman holds a sign with the English inscription “A roof or your head a basic human right”.

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 LONDON — Rent controls are becoming increasingly popular in many European nations, but experts note that they rarely solve housing crises on their own and can even scare investors away.

Rent controls are government policies, whether on local or a national level, that aim to cap house price increases. They are intended to keep housing affordable, at least for the most vulnerable parts of a population. However, the policy has its critics.

In Sweden, for example, rent controls effectively toppled the government there. In Germany, the matter was subject to a year-long legal battle. Meanwhile, lawmakers in the Netherlands, the U.K. and Ireland have all had similar discussions about their property markets.

The root causes

Speaking about lofty prices in the Netherlands, Nic Vrieselaar, a senior economist at RaboResearch, told CNBC that the market is “becoming unacceptable.” “This is a matter of supply-demand due to the low interest rate environment,” he said.

There’s an age-old trend of people flocking to urban areas where there’s more jobs and higher salaries. But, at a time of low interest rates from central banks — which European nations have experienced in the wake of the sovereign debt crisis — and help-to-buy schemes, more people have bought property, either as a first home or as an investment to let. This demand then pushes up prices given the limited housing stock on the market.

High-rise buildings in the Märkisches Viertel in Berlin.

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In addition, the so-called “Airbnb effect” has worsened the situation, experts note. Rather than selling a property or letting it out long term, many landlords choose to make their houses or apartments available for short stays. This then means there’s less stock for the locals, thus contributing to a further acceleration of rental prices.

Between 2010 and the first quarter of 2021, rents increased by 15.3% in the European Union, according to Eurostat.

Separate data gathered by Europe’s statistics office showed that, in 2020, the estimated average rent levels for apartments was the highest in Dublin, followed by Copenhagen, then Paris, Luxembourg and Stockholm.

Colm Lauder, head of real estate at investment bank Goodbody, told CNBC that he expects rental prices to keep rising. He said: “In Ireland, we are concerned that [rent] controls will stop capital coming through.”

A vicious cycle

Property investors see a significant downside in rent controls in that they cap returns. In the case of Ireland, rent increases in certain areas are limited at 4% per year.

“If they can’t get [returns] then they will look elsewhere,” Lauder said.

Private investment plays a crucial role in supporting the housing market, by promoting construction and refurbishment. If investors find higher returns in other nations, they are likely to shift their funds there and supply will remain limited in that initial market.

However, not everybody agrees with this view.

Barbara Steenbergen, a member of the International Union of Tenants and former lawmaker for the German region of Cologne, told CNBC: “We are of course pro rent controls if it’s part of a comprehensive housing package.”

She highlighted how important rent controls are for low and middle-income families, noting that in Berlin, for example, rent increases have gone up exponentially, but salaries have not.

This divide is a “threat to social peace,” she said, while adding that she has not seen investment fleeing in any market that has rent controls. One of the challenges is that investors focus on luxury buildings and less on affordable and social housing, she said.

Ultimately, the solution may lay with the root of the problem.

“What I think needs to be done is increasing supply,” Vrieselaar said.

In a statement published in 2018, the European Central Bank noted that “housing completions in the euro area have remained substantially below their average level since the start of monetary union” in 1999. In addition, the ECB also said that the lack of building permits and labor shortages have been a constraint in improving supply. 

But Vrieselaar suggested that governments should change the way they tax the sector, so they can better tackle the housing crisis. Essentially, he believes that the Netherlands should tax people’s wealth more, including their second and third homes and lower the burden on people’s incomes so tenants have more room to spend on their rent.

 

 

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Credit Suisse Q2 2021 earnings

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Credit Suisse bank.

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LONDON — A Credit Suisse investigation into its dealings with the collapsed U.S. hedge fund Archegos Capital revealed Thursday that the Swiss bank had failed “to effectively manage risk.”

The bank’s financial results have been heavily overshadowed by heavy losses following the scandal involving Archegos earlier this year.

“The investigation found a failure to effectively manage risk in the Investment Bank’s Prime Services business by both the first and second lines of defense as well as a lack of risk escalation,” Credit Suisse said as it published the report of the independent external investigation.

“It also found a failure to control limit excesses across both lines of defense as a result of an insufficient discharge of supervisory responsibilities in the Investment Bank and in Risk, as well as a lack of prioritization of risk mitigation and enhancement measures,” the bank also said.

Nonetheless, the investigation concluded that there had not been “fraudulent or illegal conduct” nor ill intent from its side and its employees.

In the wake of the sandal, the head of its investment bank, Brian Chin, and chief risk and compliance officer, Lara Warner, stepped down. The executive board decided to waive bonuses for the 2020 year, and also cut the proposed dividend.

António Horta-Osório, chairman of Credit Suisse, said Thursday: “While the bank has already taken a series of decisive actions to strengthen the risk framework, we are determined to learn all the right lessons and further enhance our control functions.”

Earnings

The outcome of the investigation was published at the same time as the Swiss lender reported its second-quarter results.

Credit Suisse said its net income reached 253 million Swiss francs ($278.3 million) for the three-month period ending June, missing expectations in its own poll of analysts. The stock is down 17% year-to-date.

At the end of the first quarter, Credit Suisse reported a hit of 4.4 billion Swiss francs due to the Archegos saga. However, Credit Suisse said Thursday that it was taking an additional pre-tax loss of 594 million Swiss francs related to the hedge fund collapse.

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How much athletes from 12 countries earn for winning medals

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Hidilyn Diaz of Team Philippines competes during the Weightlifting – Women’s 55kg Group A on day three of the 2020 Olympic Games at Tokyo International Forum on July 26, 2021 in Tokyo, Japan.

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Why some athletes earn more

More than 600 U.S. athletes are competing at the Tokyo Olympics, and the United States has so far won 11 gold, 11 silver and 9 bronze.

The U.S. Olympic and Paralympic Committee rewards athletes $37,500 for every gold medal won, $22,500 for silver and $15,000 for bronze. Most of that prize money is not taxable unless athletes report gross income that exceeds $1 million.

U.S. athletes also receive other forms of support including health insurance, access to top-tier medical facilities and college tuition assistance.

In comparison, Singapore rewards its gold medalists nearly 20 times more than the U.S. Players who clinch their first individual gold medal for the city-state stand to receive 1 million Singapore dollars ($737,000). The prize money is taxable and awardees are required to return a portion of it to their national sports associations for future training and development.

The country sent only 23 athletes to Tokyo.

The sporting economy in the U.S. allows athletes to better monetize their talents as most of it is driven by the private sector, according to Unmish Parthasarathi, founder and executive director at consulting firm Picture Board Partners.

In places like Singapore, India and elsewhere, many of the national sporting initiatives are driven by governments that sometimes use higher monetary rewards to encourage a growing sporting culture, he told CNBC.

Malaysia also has hefty rewards for its Olympic winners.

Athletes who win gold receive 1 million ringgit ($236,149), while silver winners are awarded 300,000 ringgit, and 100,000 ringgit is given to athletes who win bronze. In dollar terms, a Malaysian Olympic bronze winner will receive a higher performance reward than a gold winner from Australia or Canada.

How athletes make money

Beyond receiving monetary and non-monetary rewards from their countries for winning medals, Olympians rely on other revenue streams for their sporting endeavors.

Athletes from bigger, more competitive countries receive stipends or training grants from their national sports associations. Top performers collect prize money by winning national and international tournaments. Others draw regular salary by holding a variety of jobs.

Some, like U.S. badminton player Zhang Beiwen, reportedly relied on crowdsourcing to finance their trip to Tokyo. Most Team USA athletes are not represented by sports agents and some have no sponsors or endorsements at all, according to a Forbes report.

Naomi Osaka of Team Japan serves during her Women’s Singles Third Round match against Marketa Vondrousova of Team Czech Republic on day four of the Tokyo 2020 Olympic Games at Ariake Tennis Park on July 27, 2021 in Tokyo, Japan.

David Ramos | Getty Images

A handful of athletes may score multimillion dollar endorsements or sponsorship deals, either before competing at the Olympics or after achieving success in the Games. For example, tennis star Naomi Osaka reportedly made $55 million from endorsements in 12 months, and was named the highest-paid female athlete ever, according to reports.

But scoring lucrative deals is rare, and hardly the norm.

Parthasarathi pointed out that one profitable career move for some athletes is to go into coaching after retirement as people are willing to pay a premium for former Olympians.

Disclosure: CNBC parent NBCUniversal owns NBC Sports and NBC Olympics. NBC Olympics is the U.S. broadcast rights holder to all Summer and Winter Games through 2032.

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