Month: February 2019

Fed to Stop Shrinking Portfolio This Year, Powell Says 

The Federal Reserve will stop shrinking its $4 trillion balance sheet later this year, Fed Chairman Jerome Powell said on Wednesday, ending a process that investors say works at cross-purposes with the Fed’s current pause on interest rate hikes. 

“We’ve worked out, I think, the framework of a plan that we hope to be able to announce soon that will light the way all the way to the end of balance sheet normalization,” Powell told members of the House Financial Services Committee in what were his most detailed remarks to date on the subject. 

“We’re going to be in a position … to stop runoff later this year,” he said, adding that doing so would leave the balance sheet at about 16 percent or 17 percent of GDP, up from about 6 percent before the financial crisis about a decade ago. 

The U.S. gross domestic product is currently about $20 trillion, suggesting the Fed’s balance sheet would be between $3.2 trillion and $3.4 trillion. 

The Fed has been trimming its balance sheet — bulked up by trillions of dollars of bond-buying during the post-crisis years to help keep interest rates low and bolster the economy — by as much as $50 billion a month since October 2017. As recently as a few months ago it had expected to keep shrinking its portfolio for another couple of years. 

New tack

But in a series of meetings that began in November, the Fed has been devising a new approach. With rising demand for currency around the world, and from U.S. banks for reserves held at the central bank, Fed policymakers now believe a big balance sheet is necessary just to ensure it has proper control over the short-term interest rates it sets to manage the economy. 

In addition, Fed policymakers now say balance sheet policy should take financial and economic conditions into account. 

Questions about the plan remain, including whether the Fed will adjust the maturities of its Treasury portfolio, and how it will go about shedding the mortgage-backed securities (MBS) it accumulated during its asset-buying days. 

Powell said the Fed still has a bunch of decisions ahead of it. 

“The one on MBS sales is really closer to the back of the line — really, we have to decide about the maturity composition, things like that, and we’ll be working through that in a very careful way,” Powell said.  “Markets are sensitive to this.” 

Powell’s remarks on the balance sheet came toward the end of more than two hours of testimony before the Democrat-led House panel that includes several new members, including New York Democrat Alexandria Ocasio-Cortez. 

But the Green New Deal advocate and Bronx populist asked no questions during the debate, and much of what Powell said on Wednesday repeated comments made Tuesday to the Republican-controlled Senate Banking Committee, including that the economy is on solid ground and the Fed would be patient on raising rates. 

Inflation goal unchanged

Powell was asked, as he was in the Senate, about the Fed’s plan to rethink its policy framework this year. He assured lawmakers that the Fed is merely trying to refine its approach so it can meet its current 2 percent inflation goal. 

“We are not looking at a higher inflation target, full stop,” he said. 

Powell also repeated his warnings against a failure by Congress to raise the debt ceiling, saying there would be “bad consequences” should the United States default on its debt payments. 

Powell by law appears two times a year before Congress to brief members of the House Financial Services Committee and the Senate Banking Committee on monetary policy and the state of the economy. 

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US Trade Official: Deal with China Not Near Agreement

The top U.S. trade official said Wednesday that a new trade deal with China is not close to being completed.

“Much still needs to be done before an agreement can be reached,” U.S. Trade Representative Robert Lighthizer told a congressional panel in Washington. “If we can complete this effort, and again I say if, and if we can reach a resolution on the issue of enforceability, we might have an agreement that enables us to turn the corner in our relationship with China.”

The U.S. and China, the world’s two biggest economies, have been negotiating for months on a new agreement, even as they have imposed hefty new tariffs on billions of dollars of each other’s exports.

 

WATCH: US-China Trade Talks ‘Not Close’

Lighthizer said the countries’ negotiators, who have been meeting in Washington and Beijing, “are making real progress.”

President Donald Trump cited that progress Sunday in postponing what would have been a sharp increase in U.S. duties on $200 billion in Chinese imports that would have taken effect Friday.

The most recent U.S. statistics show China last year had a $382 billion trade surplus in deals with the United States through November. Trump is trying to alter trade terms between the two countries to end what the U.S., Japan and European countries contend are China’s unfair trade practices, including state intervention in markets, subsidies of some industries and theft of foreign technology.

China has offered to increase its purchase of American farm products and energy as part of a new trade pact.

Members of Congress, both Republicans and Democrats, urged Lighthizer to reach a wide-ranging trade agreement.

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Meet Elon Tusk: Tesla Chief Changes Twitter Display Name

Silicon Valley billionaire Elon Musk changed his Twitter display name to “Elon Tusk” in another late-night flurry of tweets on Wednesday, which also promised news from his electric carmaker Tesla Inc later this week.

In a series of tweets to his 25 million followers following charges from the U.S. Securities and Exchange Commission earlier this week, Musk accused the regulator of failing to read Tesla’s annual reports and said its oversight was “broken”.

On Wednesday, he changed his display name and added an elephant tag.

Social media platforms have featured a number of memes involving wordplay around Musk’s name this week.

He also promised Tesla would have “news” at 2 p.m. California time on Thursday. The company, deep in debt as it ramps up production of its popular Model 3 sedan, is due to repay a $920 million convertible bond a day later.

Musk had promised last year to have his public statements vetted by the company’s board, as part of a settlement with the SEC that headed off demands for him to resign as Tesla CEO.

Tesla did not immediately respond to request for comment.

 

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Malawi Vaccinates Young Girls Against Cervical Cancer

Malawi officials say the country has the world’s highest rate of cervical cancer, but only two oncologists serving the nation of 17 million people. In an effort to reduce cervical cancer deaths, the government has rolled out a massive vaccine campaign against the human papilloma virus (HPV), which can cause cervical cancer.

The immunization project follows a pilot effort in two districts between 2013 and 2015.

The campaign is run with funding from the Global Alliance on Vaccines and is expected to reach 1.5 million girls between the ages of 9 and 14 across the country.

The U.N. children’s agency, UNICEF, is among organizations implementing the project.

“The disease starts when you engage in sexual behavior and contract a virus we call human papilloma virus that causes cancer slowly, over time,” said Steve Macheso, an immunization specialist for UNICEF in Malawi. “So we are trying to catch the girls early before their sexual debut so that when even they contract human papilloma virus, the virus does not cause cancer when they grow up.”

Other organizations supporting the effort are the World Health Organization and the Clinton Health Access Initiative.

Health experts say cervical cancer causes the largest number of cancer deaths among women in Malawi.

“For the whole Malawi, we are talking about close to 3,600 new cases every year. And over 2,000 of these women die from this kind of cancer every year. This is the highest number of cervical cancer cases in the world,” said Dr. Leo Masamba, one of only two oncologists in Malawi.

Masamba says results of the HPV vaccination effort will not be felt for decades.

“In between, whilst we are waiting for those 10 to 30 years, there will still be quite a lot of cervical cancer cases coming from people that have already been infected with HPV now. We need to make sure that treatments are still available, and other interventions like palliative care is still available,” Masamba said.  

Loveness Kalanda is happy that her 9-year-old daughter will be vaccinated.

“I wish if it was possible, government should have considered vaccination for us older women because this disease is not selective,” she said, adding that she wished there were another way to protect older women from the disease.

Jonathan Chiwanda, the national cancer coordinator in the Ministry of Health, told reporters in the capital, Lilongwe, that measures are in place to tackle the disease.

“All along we have been doing surgeries, we have been offering chemotherapy. We have also been giving antiretroviral drugs with help from remission for the Kaposi sarcoma (type of cancer),” he said.

In addition, he said, the government will soon open its first-ever cancer center in Lilongwe, which will be offering radiotherapy and other treatment to patients.

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Michael Jackson Brothers Say Accusers’ Film Neglects Facts

The family of Michael Jackson had a feeling the years-old child molestation allegations against the pop superstar would resurface at some point. So they say they weren’t entirely surprised to learn that a forthcoming HBO documentary would feature two of his accusers.

“I thought, ‘Oh here we go again,’” Jackson’s oldest brother Jackie Jackson said Tuesday of the moment he learned of “Leaving Neverland” while on tour in Australia. “That’s the first thing we said,” Jackie Jackson said during an interview with The Associated Press seated next to his brothers Tito, Marlon and his nephew, Taj.

The documentary, which premiered at the Sundance Film Festival to a standing ovation , will starting Sunday air the abuse allegations of two men , Wade Robson and James Safechuck, who had previously denied Jackson molested them and supported him to authorities and in Robson’s case, very publicly.

“It was going to be the 10-year anniversary,” Taj Jackson said, referring to his uncle’s June 2009 death. “I remember a year ago I was like, ’This is too appetizing for the media. They’re going to do something. This is the time when everyone comes out of the woodwork, the same cast, the same characters that have been discredited throughout the years. They have a platform now to talk about Michael Jackson.”

It was the latest and most public pushback from the family and Jackson estate, which have repeatedly denounced the documentary in recent weeks through written statements, a lawsuit , and letters to HBO and Britain’s Channel 4, which plan to air the film. HBO announced Wednesday that it will air a special on Monday night in which Oprah Winfrey also interviews Robson and Safechuck.

Their central criticism has been the film’s failure to talk to family members or other defenders of Jackson, whom they insist never molested a child.

The brothers said they would have answered the allegations had the filmmakers asked them.

“Oh, we definitely would have come and talked to them about the situation … to protect our brother,” Tito Jackson said. “He’s not here no more. He’s passed, and, we’re his brothers, we’re supposed to do this.”

Marlon Jackson added, “I look at it as yes, you’re protecting your brother, but you’re telling the truth, and we want people to understand the truth. And I do not understand how a filmmaker can make a documentary and not want to speak to myself or some of the other families that were at Neverland.”

The documentary’s director Dan Reed has repeatedly defended his film, which uses only the voices of Robson, Safechuck and their families.

“It’s the story of these two families and not of all the other people who were or weren’t abused by Michael Jackson,” Reed told the AP the day after the film’s premiere. “People who spent time with him can go, ‘he couldn’t possibly be a pedophile.’ How do they know? It’s absurd.”

Robson, 36, and Safechuck, 40, both came forward as adults, first via 2013 lawsuits and later in the documentary, to talk about the alleged abuse, which Robson says started when he was 7, Safechuck when he was 10.

Both had previously told authorities there had been no abuse, with Robson testifying in Jackson’s defense at the 2005 molestation trial that ended with the superstar’s acquittal.

Jackson family members say they were especially stunned to first hear such allegations coming from Robson, a noted choreographer who has worked with Britney Spears and ’N Sync. Many Jacksons, including Taj, had known Robson and his family since he was a child. Robson had dated Jackie Jackson’s daughter for over seven years.

“I was like ’No that can’t be Wade Robson not the same guy that I knew, They must have got the names wrong,” Taj Jackson said. “Wade was the most adamant person when it came to 2005 and the trial. He was their first defense witness. He was the star witness. He was adamant that nothing ever happened.”

Taj Jackson said he remembers thanking Robson the day he testified, and Robson responding that it was the least he could do for Michael.

“To see that 180, it feels like the biggest backstab that you could possibly feel,” he said.

The film acknowledges and discusses the men’s initial denials of abuse. Both say they experienced trauma that emerged as adults when they started to accept what happened to them.

No one in the Jackson family has any memory of meeting Safechuck. They have focused their criticism on Robson, whose allegations, they say, have coincided with financial problems. They say in particular that being denied a job with a Jackson-themed Cirque du Soleil show prompted him to change his story.

Robson has said it had no bearing on the allegations, and that he actually removed himself from the Cirque du Soleil show because he was having nervous breakdowns. Those prompted him to talk to his therapist for the first time about the abuse.

The men’s lawsuits have been thrown out on technical grounds, but are on appeal.

The Jackson estate’s lawsuit , filed last week, alleges “Leaving Neverland” violates a 1992 contract agreeing the channel would not disparage Jackson in the future. HBO called the lawsuit a desperate attempt to undermine the film.

Jackson’s family urged those inclined to watch “Leaving Neverland” to look deeper into the situation.

“That’s all we’re worried about is just facts,” Marlon Jackson said. “The facts, which are public record, tell a totally different story than what this documentary talks about.”

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Boeing Unveils Unmanned Combat Jet Developed in Australia

Boeing on Wednesday unveiled an unmanned, fighter-like jet developed in Australia and designed to fly alongside crewed aircraft in combat for a fraction of the cost.

The U.S. manufacturer hopes to sell the multi-role aircraft, which is 38 feet long (11.6 meters) and has a 2,000 nautical mile (3,704-kilometer) range, to customers around the world, modifying it as requested.

It is Australia’s first domestically developed combat aircraft in decades and Boeing’s biggest investment in unmanned systems outside the United States, although the company declined to specify the dollar amount.

Defense contractors are investing increasingly in autonomous technology as militaries around the world look for a cheaper and safer way to maximize their resources.

Boeing rivals like Lockheed Martin and Kratos Defense and Security Solutions are also investing in such aircraft.

Four to six of the new aircraft, called the Boeing Airpower Teaming System, can fly alongside a F/A-18E/F Super Hornet, said Shane Arnott, director of Boeing research and prototype arm Phantom Works International.

“To bring that extra component and the advantage of unmanned capability, you can accept a higher level of risk,” he said.

The Mitchell Institute for Aerospace Studies in the United States said last year that the U.S. Air Force should explore pairing crewed and uncrewed aircraft to expand its fleet and complement a limited number of “exquisite, expensive, but highly potent fifth-generation aircraft” like the F-35.

“Human performance factors are a major driver behind current aerial combat practices,” the policy paper said. “Humans can only pull a certain number of Gs, fly for a certain number of hours, or process a certain amount of information at a given time.”

In addition to performing like a fighter jet, other roles for the Boeing system early warning, intelligence, surveillance and reconnaissance alongside aircraft like the P-8 Poseidon and E-7 Wedgetail, said Kristin Robertson, vice president and general manager of Boeing Autonomous Systems.

​”It is operationally very flexible, modular, multi-mission,” she said. “It is a very disruptive price point. Fighter-like capability at a fraction of the cost.”

Robertson declined to comment on the cost, saying that it would depend on the configuration chosen by individual customers.

The jet is powered by a derivative of a commercially available engine, uses standard runways for take-off and landing, and can be modified for carrier operations at sea, Robertson said. She declined to specify whether it could reach supersonic speeds, common for modern fighter aircraft.

Its first flight is expected in 2020, with Boeing and the Australian government producing a concept demonstrator to pave the way for full production.

Australia, a staunch U.S. ally, is home to Boeing’s largest footprint outside the United States and has vast airspace with relatively low traffic for flight testing. 

The Boeing Airpower Teaming System will be manufactured in

Australia, but production lines could be set up in other countries depending on sales, Arnott said.

The United States, which has the world’s biggest military budget, would be among the natural customers for the product.

The U.S. Air Force 2030 project foresees the Lockheed Martin F-35A Joint Strike Fighter working together with stealthy combat drones, called the “Loyal Wingman” concept, said Derrick Maple, principal analyst for unmanned systems at IHS Markit.

“The U.S. has more specific plans for the wingman concept, but Western Europe will likely develop their requirements in parallel, to abate the capabilities of China and the Russian Federation and other potential threats,” he said.

Robertson declined to name potential customers and would not comment on potential stealth properties, but said the aircraft had the potential to sell globally.

“We didn’t design this as a point solution but a very flexible solution that we could outfit with payloads, sensors, different mission sets to complement whatever their fleet is,” she said. “Don’t think of it as a specific product that is tailored to do only one mission.”

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Brazil’s Senate Confirms Campos Neto as Central Bank Chief

Brazil’s Senate confirmed Roberto Campos Neto as central bank governor on Tuesday, after he stressed that controlling inflation and reining in public spending were critical to supporting economic growth.

Much work must still be done to secure Brazil’s economic recovery, Campos Neto told the Senate’s economic committee at his confirmation hearing.

He indicated there would be little change, if any, to monetary policy, echoing the central bank’s current stance that decisions are based on “caution, serenity and perseverance.”

The Senate approved Campos Neto by a vote of 55 in favor to six opposed, following unanimous confirmation by the economic committee.

He will officially assume the role with the signature of President Jair Bolsonaro, likely later this week.

Campos Neto is a former senior executive at Banco Santander Brasil SA. A University of California-trained economist, he has spent his career in banking and market trading and is acutely aware of the impact central bank policy decisions and communications have on markets, analysts say.

In his testimony Tuesday, Campos Neto said the country must keep opening up capital markets to foreign and domestic investors, while avoiding inflationary stimulus or state intervention.

His rhetoric largely mirrored that of several advisers to President Jair Bolsonaro, most of whom are pushing for an overhaul of the nation’s costly public pension system and a broad series of privatizations.

Campos Neto predicted Brazil’s economy would perform better this year than last, thanks in part to reforms the government is promoting.

Brazilian interest rates have been held at a record low 6.50 percent but economic growth has slowed in recent months, weakening what was already a sluggish recovery from the 2015-16 recession.

“While his market knowledge could make him adopt a more forceful stance at some point, the need to build credibility, particularly at the beginning of his tenure, would favor prudence,” said a U.S.-based source with first-hand experience of Brazilian markets.

Campos Neto refused to discuss whether Brazil should sell any of its $375 billion reserves, saying it was something that would require more analysis.

International FX reserves serve as an insurance policy in times of crisis, he said.

“The price of that insurance is much lower now,” he said, noting the narrowing of the spread between U.S. and Brazilian interest rates to less than 400 basis points from over 1,200 bps a couple of years ago.

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Parkinson’s Drug Trial Offers Glimmer of Hope for Brain Cells

An experimental drug could offer hope for restoring damaged brain cells in Parkinson’s patients, scientists said on Wednesday, although they cautioned that a clinical trial was not able to prove the treatment slowed or halted the neurodegenerative disease.

The trial involved delivery of a protein therapy directly into the brains of Parkinson’s patients. Scientists said some brain scans revealed “extremely promising” effects on damaged neurons of those who received the treatment.

“The spatial and relative magnitude of the improvement in the brain scans is beyond anything seen previously in trials,” said Alan Whone, a Parkinson’s specialist at Britain’s Bristol University who co-led the trial.

Researchers said the therapy warranted further investigation even though it failed to demonstrate improvement of symptoms in patients who received it when compared to others given a placebo.

“The primary outcome was disappointing,” Whone told reporters at a briefing in London.

Parkinson’s is a neurodegenerative disease that affects around one percent to two percent of people over age 65. It causes tremors, muscle stiffness and movement and balance problems. Although some medicines can improve symptoms, there is no cure or treatment that can slow progression of the disease.

This trial involved 41 patients who all underwent robot-assisted surgery to have tubes placed into their brains.

That allowed doctors to infuse either the experimental treatment – called Glial Cell Line Derived Neurotrophic Factor (GDNF) – or a placebo directly to the affected brain areas. GDNF is made by privately-held Canadian biotech firm MedGenesis Therapeutix.

Half of the patients were given monthly GDNF infusions and half received monthly placebo infusions. After nine months, all participants were offered the GDNF infusions for a further nine months.

Results showed some signs of improvements, Whone said, but there was no significant difference between the treatment and placebo groups. He said this was in part due to the sizeable placebo effect in this trial.

The placebo effect has been known to confound clinical trials of treatments for conditions involving the brain, boosted by patients’ expectations that a potential treatment will work.

But the brain scan results suggested the drug might be starting to reawaken damaged brain cells. After nine months, there was no change in the scans of patients who received a placebo, but those who got GDNF showed major changes in a key area of the brain affected by the disease.

Whone said this suggested GDNF could be “a means to possibly reawaken and restore” brain cells that are gradually destroyed in Parkinson’s.

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Dining Out? This App Will Help You Find a Quiet Restaurant

When it comes to dining out, the noisiness of a restaurant can ruin an otherwise good meal. But a crowdsourcing app is helping diners choose where to eat based on noise levels. Tina Trinh reports.

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Scientists Study Tiny Creatures With Big Impact on the Ocean

It’s not just human workers who commute each day. Millions of tiny creatures that form the base of the ocean food chain migrate in giant swarms each night. They go up and down – from deep waters to the surface to feed, then back to the depths as dawn breaks. Scientists are looking at how this vertical commute affects the ocean, which is a key regulator of climate by storing and transporting heat, carbon, nutrients and freshwater around the world.

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First Iranian-American Woman to Win Oscar Turns to Iran-Themed Films

The first Iranian-American woman to win an Oscar, Rayka Zehtabchi, says she wants to build on Sunday’s triumph of her documentary about menstruation by producing several films with Iran-related themes.

“I’m very interested in telling Iranian stories as well as women’s stories,” the 25-year-old Los Angeles-based filmmaker told VOA Persian in a Skype interview on Monday. “I was raised in Southern California pretty much my whole life, but the older I get, the more I feel like I connect with and learn about my Iranian culture.”

WATCH: Rayka Zehtabchi discusses being connected to her culture

Zehtabchi won the award for best documentary short at Sunday’s Academy Awards ceremony in Hollywood for “Period. End of Sentence.” The Netflix-produced film is about women in rural India fighting the stigma surrounding menstruation by manufacturing sanitary pads to enable adolescent girls to stay in school while managing their periods.

Los Angeles high school students inspired the film by raising money to buy pad-making machines for the villagers of Hapur district, 90 kilometers east of the Indian capital, New Delhi. “Just seeing that there are these young people who care so deeply about this cause that is affecting women all over the world, and being a young woman myself, I felt compelled to jump on board,” Zehtabchi said.

Zehtabchi directed the film and shared the Oscar with American producer Melissa Berton.

Iranian-born British-American actress Nazanin Boniadi congratulated Zehtabchi on Twitter for being the first Iranian-American woman to achieve such a feat.

Watch: Rayka Zehtabchi, on being first Iranian-American Oscar winner

“It didn’t even cross my mind that I’d be the first Iranian-American woman to win an Oscar, but I feel absolutely incredible,” said Zehtabchi, the daughter of Iranian immigrants to the United States. “My dad passed away three years ago from lung cancer, and I wish he could have been there to see it, because he would have been very proud,” she added as her voice filled with emotion.

Watch: Rayka Zehtabchi, on her family’s journey to U.S.

The filmmaker said one of her next productions will be a narrative feature about her family’s journey to the United States in the early 1990s. “I’m very interested in exploring the immigrant experience and how it could be devastating but also hilarious at times, being a foreigner in a new country and having to learn how to assimilate.”

Zehtabchi said she also is working on feature version of a 2016 short film that marked her directorial debut, “Madaran.” Based on a true story about an Iranian mother who must decide whether to end or spare the life of her only son’s killer at his execution, the original film qualified for Oscar contention in the Live Action Short category that year.

Watch: Rayka Zehtabchi’s message to other young Iranian women

Asked for her message to other young women of Iranian origin who have cheered her success, she said: “You are strong and you are beautiful and you can do anything if you put your mind to it.”

This article originated in VOA’s Persian Service.

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Fed’s Powell: ‘No Rush’ to Hike Rates in ‘Solid’ But Slowing Economy

The Federal Reserve is in “no rush to make a judgment” about further changes to interest rates, Fed Chairman Jerome Powell told U.S. lawmakers on Tuesday as he spelled out the central bank’s approach to an economy that is likely slowing.

In two hours of testimony to the Senate Banking Committee, Powell elaborated on the “conflicting signals” the Fed has tried to decipher in recent weeks, including disappointing data on retail sales and other aspects of the economy that contrast with steady hiring, wage growth, and ongoing low unemployment.

“The baseline outlook is a good one,” Powell said, but slower growth overseas is a drag on the U.S. economy that “we may feel more of” in the coming months.

“We have the makings of a good outlook and our (rate-setting) committee is really monitoring the crosscurrents, the risks, and for now we are going to be patient with our policy and allow things to take time to clarify.”

If anything, Powell’s comments solidified a Fed policy shift last month in which it indicated it would pause a three-year cycle of rate hikes, which had been projected to run well into 2020, until the inflation or growth dynamics change.

The flow of new workers into the labor force, for example, has surprised the central bank and means “there is more room to grow,” Powell said.

Powell, who has led the Fed for just over a year, faced virtually no pushback from Republicans on the Senate panel, as former Fed chief Janet Yellen had in the past, that the central bank was courting inflation or financial risks by leaving rates too low.

After raising rates four times in 2018, and anticipating further hikes in 2019, the Fed in January switched to a “patient” stance as concerns about the global economy took root, and markets voiced doubts about the U.S. economic recovery.

The Fed’s benchmark overnight lending rate currently is within a range of 2.25 percent to 2.50 percent.

There was also little said by lawmakers about the Fed’s evolving plan to maintain a balance sheet of perhaps $3.5 trillion, which would be lower than the current $4 trillion but still massive by historical standards. Republican lawmakers generally have pushed the central bank to reduce a financial footprint inflated by crisis-era programs many in the party considered risky.

Financial markets were largely unmoved by Powell’s testimony, which was the first of his two hearings this week in Congress. He is due to appear before the House of Representatives Financial Services Committee on Wednesday.

U.S. Treasury yields were lower in afternoon trading while major U.S. stock indexes were slightly higher. The dollar was weaker against a basket of currencies.

Political Shift

Powell told lawmakers that the Fed expected the U.S. economy to grow solidly but at a slower pace this year than the estimated 3 percent growth for 2018, an outlook that was built into the central bank’s policy statement in January.

The “patient” approach to rate hikes has been a staple of Fed commentary since early last month.

“As long as we have steady growth with no inflation, that should keep the Fed at bay,” said Jack Ablin, chief investment officer at Cresset Wealth Advisors in Chicago.

But Tuesday’s hearing did offer a preview of issues the central bank may confront as the 2020 presidential campaign takes shape, and Democrats use their recently-won control of the House to press new economic and political ideas.

Amid a growing debate over whether the U.S. government may have far more room to expand its debt than conventional economics might recommend, or whether the Fed’s own balance sheet might help finance a “Green New Deal” of economic and environmental programs, Powell made clear he was among the traditionalists.

“The idea that deficits don’t matter for countries that can borrow in their own currency I think is just wrong. I think that U.S. debt is fairly high as a level of (gross domestic product) and, much more importantly than that, it’s growing faster than GDP,” Powell said. “To the extent that people are talking about the Fed – our role is not to provide support for particular policies” on environmental, social or other related issues.

Indeed, asked about the upcoming need to boost the U.S. debt ceiling, he said he considered the prospect of a U.S. government default on its obligations “a bright line, and I hope we never do pass it.”

Powell’s appearances on Capitol Hill this week, part of his semi-annual testimony to Congress, are his first since Democrats won control of the House in the November elections. They also follow the kickoff of a number of 2020 presidential campaigns.

Along with questions that ranged from the sources of rural poverty to the impact of climate change on banks, Senate committee members pressed points likely to figure into the Democratic primary battle.

“The Fed works for big rich banks that want to get bigger and richer,” said Senator Elizabeth Warren, a Massachusetts Democrat running for president. She questioned whether Powell would be adequately aggressive in reviewing a proposed megamerger between U.S. regional lender BB&T and rival SunTrust Banks.

Powell pledged an “open and transparent” review of the deal.

When asked whether there had been any “direct or indirect” communication from the White House about interest rates, Powell deferred, saying he would not comment on private conversations with other officials.

President Donald Trump has castigated the Fed for raising rates, arguing that the monetary tightening was undercutting his administration’s efforts to boost economic growth.

On Tuesday, Powell repeated his oft-heard pledge that the Fed will make policy decisions “in a way that is not political.”

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Underprivileged Children Find a Spot in Prestigious Literary Magazine

A library run by a volunteer group in New Delhi’s largest slum resettlement colony is helping underprivileged teenagers become writers. Some have had their stories published in India’s best-known Hindi language literary magazine as well as in other publications. For VOA, Anjana Pasricha reports from New Delhi.

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Noise-weary New York Ponders a Gentler, European-style Siren

If two New York City lawmakers get their way, the long, droning siren from police cars, fire trucks and ambulances that has been part of the city’s soundtrack for generations — WAAAAAhhhhhhh — would be replaced by a high-low wail similar to what’s heard on the streets of London and Paris — WEE-oww-WEE-oww-WEE-oww.

Their reasons for the switch: The European-style siren is less shrill and annoying and contributes less to noise pollution.

“I’ve been hearing from constituents complaining that the current sirens in New York are a high-pitched, continuous noise — a nuisance,” says Helen Rosenthal, an Upper West Side Democrat and one of the sponsors of the proposal.

Noise is consistently among the most frequent complaints to the city’s hotline, with many calls about the loud sirens that blare 24/7, wake people from their slumber and cause dogs to howl in unison. 

“Europeanizing” New York sirens would not change the decibel level — still topping out at roughly 118 — but would lower the frequency and thus make the sirens less shrill but still ear-catching enough to grab attention. 

“The alternating high-low siren required by this legislation is not as piercing,” adds co-sponsor Carlina Rivera, a Manhattan Democrat.

If approved in a council vote — which has yet to be scheduled — the legislation would require sirens on all emergency vehicles to transition within a two-year period.

Buzz about the bill even made it to last week’s NBC “Saturday Night Live,” where a “Weekend Update” anchor joked that with the European-style siren, “You can spend your ride in the ambulance pretending you have universal health care.”

City council members are looking closely at the experience of the city’s Mount Sinai Health System, which already uses the two-tone siren in its 25 ambulances that make about 100,000 trips a year. The switch was made last year after decades of complaints from residents of the Upper East Side home of the hospital complex. 

At community board meetings, Mount Sinai’s Emergency Medical Services Director Joseph Davis played various siren options to find out which one locals preferred.

 “People hated them all,” Davis said, “but the `high-low’ was least intrusive. It didn’t have that piercing sound.”

Davis, a 40-year EMS veteran who suffers from hearing damage that he blames on repeated exposure to sirens, said the change was simple and cost effective: All it took was reprogramming the electronic box in each vehicle, which comes preloaded with seven different sounds with names such as “Wail,” “Yelp” and “Piercer.” 

In fact, many ambulances, fire trucks and police cars are equipped with alternate sirens and horns that they can employ in certain situations, such as in traffic when cars and pedestrians just won’t get out of the way. They include short blips and the “Rumbler” low-frequency, vibrating siren aimed at motorists who may otherwise be unable to hear higher frequencies.

For some Manhattanites, any change in the city’s daily siren song would be welcomed.

“I always have to cover my ears with my hands when a siren-blaring ambulance passes,” says Louise Belulovich, a Manhattan attorney. “If I’m carrying packages and unable to, then what is an annoying experience becomes a painful one.”

But Linda Sachs, a longtime resident of Manhattan’s Upper West Side who lives near one of the Mount Sinai hospitals that uses the new European siren, doesn’t think the change is for the good. She prefers the old New York standard.

“The old sirens never woke me up, but these make me shudder,” Sachs says, adding that she understands city lawmakers are attempting to do something about noise pollution. “But the old sound wasn’t as obnoxious.”

 

 

 

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Cameroon Cracks Down on Illegal Fuel Trade

Cameroonian police officers, assisted by members of the country’s elite corps, seized hundreds of containers of fuel illegally transported from Nigeria by suspected Central African Republic rebels in the northern town of Mbe, Cameroon.

Rigobert Ojong, a member of a task force of military, police and civil society members created three weeks ago to stop the illegal fuel trade, said the group received a tip that the fuel was on its way to the C.A.R., where it would be used by rebels fighting the central African state’s government. 

“We have put aside personnel dedicated to this fight, within the framework of this task force, and we have been able to intercept about 1,500 drums of fraudulently imported fuel. If we go by the price in the black market, we are talking about more than 3 billion CFA francs [$5 million] a year,” Ojong said.

Cameroon’s government says an unknown quantity of oil is smuggled from Nigeria through its territory because the border is so porous. The military says it has opened an investigation to track dealers who might be collaborating with rebel groups in the C.A.R.

Alleged corruption

Businessman Patrice Essola, who supplies fuel to the C.A.R. from Cameroon, says illegal trade with C.A.R. rebels is facilitated by corrupt government officials in both countries.

He said the rebels and traffickers work in collaboration with corrupt Cameroonian military officials and C.A.R. border immigration staff to import the fuel from Nigeria. Some of the tankers and trucks that smuggle the fuel are even protected by corrupt officials while in Cameroon and in the C.A.R., Essola added.

Kildadi Taguieke Boukar, governor of the Adamawa region that shares a border with the C.A.R., denies corrupt military officials assist rebels and smugglers, but said investigations had been opened.

Each time the traffickers are arrested, they answer charges in courts of law, Boukar said, but added the task is very, very difficult because Cameroon’s borders with Nigeria and the C.A.R. are very porous. All of the fuel will be taken to C.A.R. authorities, he said.

C.A.R. violence, peace deal

In January, Cameroon said 300 of its citizens had been abducted by suspected C.A.R. rebels within the past two years, along with at least 5,000 cattle. Local border communities asked the government to authorize self-defense groups to be equipped with guns to face rebels who they said continued to cross to their villages for supplies.

The C.A.R. was plunged into turmoil in 2013 when Muslim rebels known as the Seleka seized power in the majority-Christian country. A band of mostly Christian militias, called the anti-Balaka, rose up to counter the Seleka. Thousands of people have been killed in the violence and more than one million are internally displaced. An estimated 570,000 people have fled to neighboring countries, with about 350,000 in Cameroon.

On Feb. 2, the U.N. mission in the C.A.R., known as MINUSCA, and the African Union announced that a peace deal between the C.A.R. government and 14 rebel groups had been reached after sponsored talks in Sudan. They called on the C.A.R.’s neighbors to help bring peace by not allowing their borders to be used for supplies or as a hiding ground for fighters who refuse to respect the deal.

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Using One Germ to Fight Another When Today’s Antibiotics Fail

Bacteria lodged deep in Ella Balasa’s lungs were impervious to most antibiotics. At 26, gasping for breath, she sought out a dramatic experiment — deliberately inhaling a virus culled from sewage to attack her superbug.

“I’m really running out of options,” said Balasa, who traveled from her Richmond, Virginia, home to Yale University for the last-resort treatment. “I know it might not have an effect. But I am very hopeful.”

Pitting one germ against another may sound radical, but it’s a sign of a growing global crisis. Increasingly people are dying of infections that once were easy to treat because many common bugs have evolved to withstand multiple antibiotics. Some, dubbed “nightmare bacteria,” are untreatable. Now scientists are racing to find novel alternatives to traditional antibiotics, a hunt that is uncovering unusual ways to counter infection, in unusual places.

One possible treatment tricks bacteria out of a nutrient they need to survive. Others rev up the immune system to better fend off germs.

And viruses called bacteriophages — discovered a century ago but largely shelved in the West when easier-to-use antibiotics came along — are being tried in a handful of emergency cases.

“People’s frustration with antibiotic resistance boiled over,” said Yale biologist Benjamin Chan, who travels the world collecting phages and receives calls from desperate patients asking to try them. “We’re more appreciative of the fact that we need alternatives.”

Nature’s bacterial predator, each phage variety targets a different bacterial strain. Originally used to treat dysentery in the early 20th century, today Chan looks in places like ditches, ponds, and, yes, sewage treatment plants for types that attack a variety of human infections.

“The best places are often really dirty places, because we’re dirty animals,” he said.

Chan saw hope for Balasa in a lab dish covered in brownish bacterial goo.

Balasa has a genetic disease called cystic fibrosis that scars her lungs and traps bacteria inside, including a superbug named Pseudomonas aeruginosa. A daily dose of inhaled antibiotics kept the infection in check until last fall, when the drugs quit working. A last-ditch IV antibiotic wasn’t helping much either.

Chan grew a sample of Balasa’s bacteria from her phlegm. Then came the key test: He dripped several pseudomonas-targeting phages into the grimy dish — and clear circles began appearing as the viruses consumed the bugs around them.

But would what worked in the lab really help Balasa’s lungs?

Bugs outpacing drugs

At least 23,000 Americans die every year as a direct result of an antibiotic-resistant infection, and many more die from related complications, according to a 2013 report from the Centers for Disease Control and Prevention. The CDC plans an updated count, but other research has estimated the toll could be seven times higher.

And while there are no good counts in much of the world, one often-cited British report said unless solutions are found, by 2050 up to 10 million people globally could be dying from drug-resistant infections, slightly more than die from cancer today.

Yet few new antibiotics make it to market, and many major drug companies have ended antibiotic research, seeing little profit in medicines that germs will soon outsmart. A recent report found just 11 traditional antibiotics being studied to treat any of the World Health Organization’s list of worst bugs, with no guarantee they’ll work.

And while some people are more at risk — those getting surgery, or cancer chemotherapy, for example — “antibiotic resistance is a problem essentially for everyone,” said Dr. Anthony Fauci, infectious diseases chief at the National Institutes of Health.

“Over the next several years, all indicators seem to point to the fact that this is going to get worse and worse,” he added.

Looking for bugs’ weak spots

Finding alternatives means “figuring out what the vulnerabilities of infecting bacteria are. What do they need to cause an infection?” said Dr. Pradeep Singh of the University of Washington.

Singh and fellow UW lung specialist Dr. Christopher Goss zeroed in on iron, a nutrient vital for bacterial growth. It turns out that bugs can’t always tell the difference between iron and a chemically similar metal named gallium. Gallium doesn’t nourish and knocks other systems out of whack, Goss said.

For two small studies, the researchers recruited cystic fibrosis patients who had antibiotic-resistant pseudomonas in their lungs but weren’t openly sick. The patients received a five-day infusion of a gallium-based drug. Over the next few weeks, their lung function improved, enough that next-step studies are being planned.

“It just seems like a proactive way of destroying bacteria,” said study participant Tre LaRosa, 24, of Cincinnati. His sister died of cystic fibrosis and while his own CF is under control, he worries that one day a resistant infection will flare. “I can’t do anything to prevent that. Antibiotic resistance I think is one of the least talked about and most significant concerns.”

Spurring the immune system

Fauci envisions doctors one day vaccinating people a few weeks before, say, a planned knee replacement to guard against catching a staph infection in the hospital.

Sixteen experimental vaccines are in development to target various infections, according to a recent presentation to a presidential advisory council on resistant germs.

Particularly promising, Fauci says, are lab-engineered “monoclonal antibodies” designed to home in on specific bugs. In one set of studies, researchers are giving experimental antibodies to ventilator patients who have bacteria building up that could trigger pneumonia.

Harnessing viruses for the best attack

In Virginia, Balasa learned of another cystic fibrosis patient helped by Yale’s phage experiments and asked to try, hoping to postpone the last option for CF, a lung transplant.

Phages work very differently than traditional antibiotics. Like a parasite, the virus infiltrates bacterial cells and uses them to copy itself, killing the bug as those copies pop out and search for more bacteria. Once the infection’s gone, the virus dies out. Because each phage only recognizes certain bacteria, it shouldn’t kill off “good bugs” in the digestive tract like antibiotics do.

Bacteria evolve to escape phages just like they escape antibiotics, but they generally make trade-offs to do so — such as losing some of their antibiotic resistance, said Yale evolutionary biologist Paul Turner.

For example, some phages recognize bacteria by a pump on their surface that deflects antibiotics. As the phages kill those bugs, the bacteria rapidly evolve to get rid of that surface pump — meaning survivors should be susceptible to antibiotics again.

“It’s reviving an arsenal of drugs that are no longer useful,” Turner said.

Yale’s first test case was an 82-year-old man near death from a heart implant teeming with untreatable pseudomonas. Chan purified a phage from a Connecticut lake that he’d matched to the patient’s germs, and with emergency permission from the Food and Drug Administration, doctors squirted it into the wound. The man’s infection disappeared.

Then doctors at the University of California, San Diego, saved a colleague who’d been in a months-long coma, using an IV mixture of several phages that target a superbug named Acinetobacter baumannii.

Doctors and families began calling both centers seeking emergency care, even as formal studies are being planned to try to prove phages’ value.

“There’s an incredible opportunity here,” said Yale pulmonologist Dr. Jon Koff. “But with that you have to have the appropriate amount of skepticism,” with careful testing to tell when it might help.

Last month, Balasa became Yale’s eighth patient, inhaling billions of phages over seven days.

Almost immediately, she was coughing up fewer bacteria. It took a few weeks for her to feel better, though, and during that time she switched briefly to some antibiotics she’d previously given up. Without a formal study it’s hard to know, but Chan’s tests suggest phages killed much of her predominant pseudomonas strain and made the survivors sensitive again to a course of those antibiotics.

Balasa called that “a very big success for me,” and was able to quit her antibiotics. She didn’t notice additional improvement after a second round of phages, aimed at different strains.

“The true test,” Balasa said, “is how long I can go without using any antibiotics again.”

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Boeing Nominates Former UN Ambassador Haley to Join its Board

U.S. aerospace manufacturer Boeing said on Tuesday it has nominated Nikki Haley, former U.S. ambassador to the United Nations and a close ally of President Donald Trump, to join its board of directors at the company’s annual shareholders meeting on April 29.

If elected by Boeing shareholders, she would help guide the future of America’s largest exporter, with a network of suppliers across the United States and the world, as Washington and Beijing have been locked in intense negotiations to end a trade war.

Haley’s nomination comes as Boeing grapples with a major decision: whether to launch an all-new jetliner known as NMA, a midsize plane that would serve a niche market falling between narrow- and wide-body aircraft.

The world’s largest planemaker has said it would make a final launch decision in 2020 on the new program, which is expected to define competition with archrival Airbus SE.

Viewed as a rising Republican Party star, Haley has often been mentioned as a future presidential candidate. Her counterparts at the United Nations saw her as a voice of clarity in the Trump administration.

Haley, 47, is the first female governor of South Carolina and a three-term legislator in the South Carolina House of Representatives. As governor in 2015, Haley was a key opponent of a campaign by Boeing’s largest labor union to form a collective bargaining unit at its 787 Dreamliner factory in South Carolina – though the machinists were later successful in forming a small bargaining unit there.

Boeing has faced growing scrutiny over its links to the Trump administration after a former senior planemaking executive, Pat Shanahan, was named deputy defense secretary and later acting defense secretary. The 31-year Boeing veteran has recused himself, however, from matters relating to the aerospace company.

The U.S. government has been weighing the purchase of an advanced version of the F-15 Boeing fighter. Last year, Boeing’s defense side had a series of wins, including the U.S. Air Force’s next training jet, which could be worth up to $9.2 billion, as well as a contract to replace UH-1N Huey helicopters worth $2.4 billion over the life of the programs.

In a press release, Muilenburg praised Haley’s record in government and industry partnership.

“Boeing will benefit greatly from her broad perspectives and combined diplomatic, government and business experience to help achieve our aspiration to be the best in aerospace and a global industrial champion,” Muilenburg said.

Based on total compensation for Boeing’s other 13 board members, Haley can expect to earn more than $300,000, well above her salary as U.N. ambassador.

Separately on Tuesday, the shareholders of Brazilian planemaker Embraer SA approved a deal to sell 80 percent of the Sao Paulo-based company’s commercial jet division to Boeing, a move that could reshape the global market for aircraft of up to 150 seats.

Boeing shares were flat at $427.88 a share in afternoon trading on the New York Stock Exchange.

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Mobile World Congress Overshadowed by Huawei 5G Spying Standoff

Robots, cars, drones and virtual-reality gaming sets connected by cutting-edge 5G networks are among the thousands of futuristic gadgets on display at this year’s Mobile World Congress in Barcelona, Spain.

While there is much excitement over how 5G will transform our everyday lives, the conference is overshadowed by the standoff between the United States and Beijing over the Chinese telecoms giant Huawei, which the U.S. says could be used by the Chinese government for espionage.

Some U.S. cities and parts of Asia are already operating 5G mobile networks. They offer speeds of over a gigabyte per second and low latency — in other words, practically instant connections with no delay.

Experts say that opens up whole new fields of connectivity, from new generations of virtual reality gaming and communication, to remote robotic surgery.

The technology promises to transform not only the mobile phone in your pocket — but also the world around us, says Paul Triolo of the Eurasia Group, who spoke to VOA from the conference.

“The really key aspects of 5G, like some of the low latency communications and massive sensor, massive machine-to-machine communications, that’s more about industry and industrial uses. And that gets into thing like critical infrastructure so you’re going to have a lot more non-personal or industrial data flying around and that really has people concerned. For example, military forces in countries like the U.S. will also leverage large parts of the commercial network,” said Triolo.Chinese firm Huawei is a big presence at the Mobile World Congress and a big player in 5G network technology.

Washington has banned the company from 5G rollout in the United States, citing Chinese legislation requiring companies to cooperate with the state — raising fears Huawei 5G networks overseas could be used as a ‘Trojan horse’ to spy on rivals.

Attending the Mobile World Congress Tuesday, the U.S. State Department’s Deputy Secretary for Cyber Policy Robert L. Strayer urged allies to do the same.

“We will continue to engage with these governments and the regulators in these countries to educate them about what we know and keep sharing the best practices for how we can all successfully move to next generation of technology. I´ll just say there are plenty of options in the West,” Strayer told reporters.

Huawei’s management has said the company would never use ‘back doors’ for espionage — and the Chinese government has dismissed the accusations.

Australia, New Zealand and Japan have followed Washington’s lead and restricted Huawei’s involvement in 5G. Europe remains undecided — but the industry needs clarity, said analyst Paul Triolo.

“The European community in particular and also the U.S. have to clarify what these policies mean, what a ban would mean or what some kind of a partial ban would mean, if there’s really a middle ground that can be found here.”

Vodafone’s CEO Nick Read told the Barcelona conference that banning Huawei could set Europe’s 5G rollout back another two years.

The eye-catching gadgets show the potential that 5G networks are about to unleash. But the question of who controls those networks, and the data they carry, looms large over this futuristic world.

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