Here’s what you need to know:
Recognition…Bill O’Leary / The Washington Post, via Getty Images
Michael S. Barr, a law professor and former Obama administration official, is President Biden’s leading choice to control the currency, a powerful body that regulates banks.
As Vice Secretary of the Treasury under President Barack Obama, Mr. Barr helped shape the Dodd-Frank Financial Reform Bill, a comprehensive regulatory bill that puts financial firms under stricter government oversight, a résumé that appears to certify him as a reformer.
Progressives are less in love, however, writes Emily Flitter in the New York Times. Some have pointed to Mr Barr’s efforts to relax some of Dodd-Frank’s restrictions, such as the Volcker Rule, which prohibits banks from using customer funds to make their own bets in the markets, as evidence that it may be more business-friendly.
His recent connections in the financial world, including advising a trading group trying to sway lawmakers on behalf of fintech companies, were also examined.
Several progressive groups have expressed support for another candidate: Mehrsa Baradaran, a law professor who has studied the inequality of treatment black and poor people often receive from banks. A supporter of Ms. Baradaran even threatened a hunger strike if Mr. Barr wins the nomination.
The explosion in cryptocurrency and online banking has increased the stake in the regulatory role. Fintech firms are advocating bank charter, and the wider adoption of cryptocurrencies like Bitcoin will result in more government scrutiny.
The trade restrictions between China and the United States under the Trump administration, coupled with the coronavirus pandemic, have given China a surprising advantage.
China has surpassed the US for the first time as the leader in FDI, an important measure of a country’s economic health.
Foreign investment in the United States fell by almost half, or 49 percent, to $ 134 billion in 2020, the United Nations Conference on Trade and Development announced on Sunday.
The decline in the United States is mostly focused on total trade, financial services, and mergers and acquisitions, according to the study.
China, where the coronavirus outbreak was first detected, saw a modest 4 percent increase to $ 163 billion, led by investments in the country’s growing high-tech sector and in mergers and acquisitions. China, the most populous nation in the world, imposed strict lockdown and masking requirements, rules that appear to have helped contain the spread of the virus within its borders.
Foreign direct investment fell for most countries as they struggled to contain the virus. Investment in Europe was wiped out and global foreign investment fell by 42 percent overall.
Developed nations like the United States tend to be attractive targets for such investments because of their skilled workforce, open markets, and rigorously enforced regulations.
China’s manufacturing expertise and growing consumer base have attracted overseas companies like Apple for years, but its strict policies regarding foreign ownership of its businesses and sometimes unclear enforcement rules made such investments difficult.
However, the growing clout of consumers has been difficult for multinational companies to ignore. When foreign investors opened a business, Chinese citizens bought and created enormous wealth. The country is making a stuttering path from an economy driven by exports to one driven by its own consumers.
The United Nations group expects foreign direct investment to remain weak globally through 2021.
Recognition…To watch
The tax changes approved by Congress late in the year are now forcing the IRS to postpone the start of the tax return season, New York Times’ Ann Carrns reports.
Even so, according to the IRS, most taxpayers who receive a 2020 tax refund will get it within three weeks if they file electronically and have the money deposited directly into their bank account. The average refund over the past few years has been more than $ 2,500. Many families use refunds to pay bills or to use them as a kind of forced savings plan.
Typically, the Internal Revenue Service begins accepting and processing individual income tax returns in late January. However, the agency has postponed the start of filing tax returns for the 2020 tax year to February 12th.
The IRS Free File program is now ready for use if you want to prepare your own tax return. Free File, a partnership between the IRS and tax software company, is available to individuals with an adjusted gross income of $ 72,000 or less. The program offers free online preparation and filing of federal declarations. However, some vendors charge government returns fees. You can now complete your return and it will be submitted to the IRS starting February 12th.
This is going to be another challenging tax season for the Internal Revenue Service, which in recent years has struggled with reduced budgets that have forced it to get by with fewer workers and outdated computer systems. During the pandemic, it also had the extra work of distributing stimulus checks.
Recognition…Oli Scarff / Agence France-Presse – Getty Images
British online fast fashion retailer Boohoo announced Monday that it would buy the Debenhams brand name and website for £ 55 million, or $ 75 million, a few weeks after the 242-year-old department store chain ceased operations after opening had administration in April.
The deal is the latest reflection of the seismic reorganization in the global retail hierarchy caused by the coronavirus pandemic. Strong companies with agile supply chains and e-commerce activities grow faster, while weaker – often older – competitors with large stationary footprints and more traditional models gradually fall away.
Asos, another online fast fashion retailer, confirmed Monday that it was in exclusive talks with administrators at Philip Green retail group Arcadia to buy the portfolio of their fashion brands, which include Topshop, Topman, Miss Selfridge and HIIT . Arcadia filed for bankruptcy protection late last year.
A final sale in 124 Debenhams stores began in December as administrators continued to search for offers for all or part of the company. Now, Boohoo, best known for his $ 5 bikinis and connections to reality TV stars, is going to buy the Debenhams intellectual property rights for cash – though none of his stores or inventory will be included. The company took the same approach when it acquired several other UK brands that were on the brink of bankruptcy, including Oasis and Karen Millen.
Debenhams was expected to restart on Boohoo’s web platform in early 2022.
“Our acquisition of the Debenhams brand is strategic as it is a huge step in accelerating our drive to lead not only in fashion e-commerce but also in new categories such as beauty, sports and homeware,” said Boohoos Chairman of the Board, Mahmud Kamani. “Our aim is to create the largest UK market.”
Neither Asos nor Boohoo are looking to buy stores, so the remaining 118 Debenhams department stores and more than 400 Arcadia-branded stores are likely to close permanently, putting tens of thousands of jobs at risk.
Boohoo, co-founded by Mr Kamani in Manchester in 2006, was subject to public scrutiny last year after investigations into working conditions at Leicester textile mills found that many workers were paid less than the minimum wage.
-
The S&P 500 futures fluctuated but indicated that the main Wall Street index would open slightly higher on Monday after positive sentiment in Asian markets stalled in European trading as new data saw a drop in business confidence showed.
-
Most of the European indices were lower. The Stoxx Europe 600 fell 0.2 percent, led by losses in financial and energy companies. The CAC 40 in France fell 0.5 percent, the DAX in Germany and the FTSE 100 in Great Britain by 0.3 percent. Hong Kong’s Hang Seng rose 2.4 percent to its highest level in two and a half years. Gains were driven by an 11 percent rise in Tencent shares after a company he supported announced an IPO
-
In Europe there is growing concern about the pace of vaccination. Drug manufacturers said the European Union would face a significant delay in delivery in the first few months of the year, and officials replied they would take legal action to fulfill their contracts.
-
In Germany, Europe’s largest economy, the most recent surveys showed a sharp decline in expectations of the economy. The Ifo survey on business sentiment fell to its lowest level in six months.
-
“With the current lockdown measures until mid-February and without any significant easing immediately afterwards, the short-term prospects for the German economy are anything but rosy,” wrote Carsten Brzeski, an economist at the Dutch bank ING, in a note.
-
The UK has seen a shake in retail and newer online brands have cleaned up the old guard: shares of Boohoo, the fast fashion online retailer, rose as much as 5.7 percent after it announced the Brand to buy from Debenhams, a two hundred year old department store chain that went bankrupt last year. Shops are likely to be closed.
-
Shares of ASOS, another online retailer, even surged 6.4 percent after it was confirmed that after the downtown collapse there was some talk of buying some of Arcadia’s most popular brands, including Topshop.
-
In other financial markets, the US dollar and the gold price have barely changed. Oil futures rose and West Texas Intermediate prices rose 0.8 percent to $ 52.66 a barrel.
