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Situational awareness: The ECB today is expected to announce it will lower interest rates to -0.5% and add some stimulus measures, after ending its bond-buying program in December and having already restarted its TLTRO bank lending program. (Quartz)
President Trump announced Wednesday night he would postpone the latest round of tariffs on $250 billion worth of Chinese imports for 2 weeks. The news will likely soothe the market, but the tariffs have already done a number on the U.S. economy.
Why it matters: "The data speaks for itself," Torsten Slok, chief economist at Deutsche Bank Securities, says in a note to clients. "The trade war is having a serious negative impact on the US economy."
Threat level: The trade war with China has already reduced U.S. employment by 300,000 jobs, compared with likely employment levels absent the trade war, Moody’s Analytics estimates.
The big picture: The most damaging part of a trade war is not the tariffs, but the costs associated with the uncertainty it creates. However, the tariffs themselves also are making a dent.
Between the lines: Trump’s tariff policy has reduced the economic benefits from programs like tax cuts and deregulation that had a positive effect on the economy, David G. Tuerck and William Burke write in a recent paper from the National Foundation for American Policy.
The bottom line: Some have argued that because manufacturing and trade are such small pieces of the U.S. economy the trade war would have a negligible impact. But it's no longer just the manufacturing sector that's hurting as a result of the trade war — harm is now being inflicted and felt throughout the economy.
Trump has argued that revenue raised by the tariffs benefits the U.S. by bringing "billions of dollars into our Treasury" and has been "partially responsible for our great economic results."
Reality check: Tuerck and Burke in their paper find that the subsidies provided to American farmers represent 159% of the revenue raised by tariffs through June 30.
Public pension funds are underfunded by trillions of dollars, which is a problem for the states that have guaranteed them, but data shows most Americans have badly underinvested in their own retirement funds as well.
What's new: A survey from Clever Real Estate finds that even baby boomers who are nearing retirement have only saved about 30% of the recommended amount, and the average boomer is about $320,000 shy of the income level financial advisers like Fidelity recommend, based on their average salary.
Worse, data shows many boomers don't have any emergency savings. The study finds:
Axios' Bob Herman writes: Purdue Pharma has tentatively reached the first "global" settlement in the nationwide opioids lawsuit, the New York Times and AP report. The plaintiffs later confirmed this to Axios.
The big picture: The deal would reportedly result in the maker of OxyContin entering bankruptcy and the Sackler family owners paying $3 billion over 7 years, among other terms.
Key quote from plaintiffs' lawyers Paul Hanly, Paul Farrell and Joe Rice:
"While this agreement represents significant progress in the litigation, we continue to move forward toward October’s federal bellwether trial against other opioid manufacturers, distributors, and pharmacies."
Netflix stock has been on a distinctly negative trajectory since early July when it rose to $381 a share, near its all-time high. It's been downhill since then and the stock has lost nearly $100 a share, closing Wednesday at $288.27.
What's happening: The company looks to be loading up its war chest, going on an unprecedented spending spree of original programming and comedy specials in an effort to keep subscribers and lure new ones after reporting disappointing earnings in its last quarter.
But analysts at Bank of America Merrill Lynch argue Apple doesn't have the firepower.
Yes, but: Apple's stock jumped more than 3% on Wednesday, as equity analysts from Barclays, Morgan Stanley, JPMorgan, Goldman Sachs, UBS and others praised Apple's new low-priced offerings, with Morgan Stanley's Katy Huberty calling Apple a "top pick heading into 2020."
Oil prices sank almost immediately after a Bloomberg report that Trump discussed easing sanctions on Iran in an effort to secure a meeting with Iranian President Hassan Rouhani.
Why it matters: The market slumped as the news could mean more supply back on the market, with WTI futures dropped nearly 3% and Brent crude fell more than 2.25%.
The big picture: Oil is still trading within the range that it has been for much of the past 3 months. Despite significant volatility, the market has made little headway in moving decisively up or down as it did during the first half of the year.