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Illustration: Sarah Grillo/Axios
The IMF lowered its growth forecast yesterday for the third time in 6 months to its lowest projection since the financial crisis.
Why it matters: It's a stark reversal from the "synchronized global growth" theme the IMF had jubilantly welcomed just 2 years ago and even a departure from last year's wistful optimism.
The big picture: IMF officials had been sounding the alarm ahead of the group's annual meetings in Washington this week.
Yes, but: Lagarde and Gopinath have made a point to say that they don't see a recession in the near term, and they expect growth to pick up in late 2019 and in 2020.
Yes, but, but: The IMF's rosy future economic projections rely on politicians avoiding "costly policy mistakes" and working cooperatively. Globally, politicians have been doing just the opposite.
Watch this space: Asked by Axios during Tuesday's press conference how the IMF factors growing political dysfunction and the fact that central banks this year have had to add more stimulus rather than begin normalizing interest rate policy, Gopinath dodged.
The IMF's prediction of 3.3% global growth in 2019 still relies on a lot of optimistic assumptions.
The 3.3% estimate is down from estimates of 3.5% in January and 3.7% in October. All of the world's developed economies, including the U.S., and most major emerging-market economies saw a write-down in their outlook.
Sony shares jumped 8% after Reuters' Svea Herbst-Bayliss and Liana Baker reported that activist investor Daniel Loeb’s hedge fund Third Point was building a stake in the company to push for changes that include shedding some businesses.
Why it may be different this time: Sony is now under new management and its stock has been 10% lower over the last 12 months. Third Point is raising a dedicated investment vehicle to target between $500 million and $1 billion to buy more Sony shares, per the report.
Thought bubble from Axios' Sara Fischer: Analysts don't expect Sony to bow to Third Point's pressure to sell Sony Pictures this time around, especially given that the firm will have even less leverage now than it did when it first pushed the Japanese giant to sell Sony Pictures in 2014.
The bottom line: The market for studio-quality content has skyrocketed as a result of a digital TV and movie streaming boom, which has Third Point convicted that Sony Pictures is a hot asset to sell, and Sony convinced that it's a hot asset to keep.
Crude oil prices look to be decoupling from oil and gas supply again in 2019. Brent, the global benchmark, is trading above $70 a barrel on international markets.
The big picture: The run-up in prices so far comes despite global discoveries of oil and gas reaching 3.2 billion barrels of oil equivalent in the first quarter. Most of the gains were recorded in February, when 2.2 billion barrels were discovered — the highest since August 2015, Rystad Energy said in short note.
Quick take: The big finds are another sign that fears of a crude supply crunch opening up by the early 2020s likely won't come to pass, Axios' Ben Geman writes.
What's next: "[T]he push for substantial new discoveries shows no signs of slowing down, with another 35 high impact exploration wells expected to be drilled this year, both onshore and offshore," Rystad said.
But, but, but: "Forecasts of a supply gap persist, but they’re being pushed further out into the future," Bloomberg reported in late January, and the IEA has warned against complacency.
The Nasdaq is recommending regulatory reforms to the SEC, including a change to rules that could impact smaller public companies, investors' access to market data and the cost of trading — all of which, the exchange says, could spur more innovation, Axios' Courtenay Brown reports.
Why it matters: It's the latest attempt by a stock exchange to shift current rules in a way that it says will benefit investors.
Background: SEC chairman Jay Clayton, a 2017 Trump appointee, has taken a harder line on stock exchange practices in the "interests of America’s retail investors" — most recently by trying to implement a controversial pricing program that's since been halted while a judge decides whether to take up a lawsuit by NYSE, Nasdaq and Cboe Global Markets to block the initiative.
Among the proposals:
But, but, but: Don't expect immediate action (if any) by the SEC, which tends to move slowly.
Go deeper: 3 stock exchanges take on the SEC
The velocity of money in the U.S. has been consistently falling for nearly a decade but is now starting to see a sustained pickup. It could be the first real sign of inflation in the U.S. after years of stagnation.
What it means: The velocity of money is a measure of how quickly money is spent in a given time period. It's a metric used to determine whether people in a country are spending and saving and at what rate.
The big picture: As the Fed has sought to stimulate growth in the U.S. economy through bond buying and low interest rates, the amount of money stock has risen to record highs while the velocity of money has fallen to record lows.
There was a bit of a misunderstanding between Treasury Secretary Steve Mnuchin and Rep. Maxine Waters, the chairwoman of the House Financial Services Committee, yesterday.
A brief snippet of the conversation:
Waters: "As I have said, if you wish to leave, you may."
Mnuchin: "If you'd wish to keep me here so that I don't have my important meeting and continue to grill me then we can do that. I can cancel my meeting and I will not be back here. I will be very clear. If that's the way you would like to have this relationship."
Waters: "Thank you! The gentleman, the secretary, has agreed to stay to hear all the rest of the members. Please cancel your meeting and respect our time."
It went on like that, and it ended spectacularly.