(TheDailyBeast) Richard Burr Doesn’t Belong in the Senate. He Might Belong in Pr

Richard Burr Doesn’t Belong in the Senate. He Might Belong in Prison.

The senator publicly said that the “framework Congress has put in place… ensure[s] we are prepared,” even as he was secretly sounding the alarm and cashing out of his investments.


Sen. Richard Burr, who was privy to secret briefings about the coronavirus when he cashed out a large portion of his net worth in stock, may also have engaged in securities fraud.

As ProPublica reported, Burr’s statutorily mandated trading reports disclose that he dumped between $628,000 and $1.7 million of stock on February 13, in 33 separate transactions. The stocks Burr cashed out of, two weeks before the markets began to plunge, quite possibly made up the bulk of his net worth, which Roll Call estimated totaled $1.7 million in 2018. In January, Burr publicly declared that the nation was “better prepared than ever before to face emerging public health threats, like the coronavirus.” But Burr had been receiving regular, secret briefings about the imminent coronavirus threat, and secretly warned political insiders the nation faced an imminent catastrophe on par with the worst influenza pandemic in modern history.

It’s as yet unclear whether Burr’s stock dump constituted securities fraud, but it is plain that he reprehensibly violated the public trust, and therefore should not remain in office.

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WSJ : Burr, Senate Colleagues Sold Stock After Coronavirus Briefings

Burr, Senate Colleagues Sold Stock After Coronavirus Briefings
Multiple members of Congress and spouses made sales that saved them from losses before markets slid

Weeks before the new coronavirus pandemic sent the stock market plummeting, several members of Congress, their spouses and investment advisers each sold hundreds of thousands of dollars in stock after lawmakers attended sensitive, closed-door briefings about the threat of the disease.

Some of the well-timed sales spared the senators and their spouses as much as hundreds of thousands of dollars in potential losses, a Wall Street Journal analysis of the trades shows.

Sen. Richard Burr, a top Republican from North Carolina who sits on two committees that received detailed briefings on the growing epidemic, reported in disclosure reports that he and his wife on Feb. 13 sold shares of companies worth as much as $1.7 million.

The Journal analysis shows that the shares sold by the Burrs were worth—at minimum—$250,000 less at the close of trading on March 19 than they were when the senator and his wife sold them.

Mr. Burr quickly drew criticism after his stock sales were reported Thursday evening by ProPublica and the Center for Responsive Politics. Fox News host Tucker Carlson called for Mr. Burr to resign, as did a handful of Democratic House members and the North Carolina Democratic Party.

Mr. Burr said in a statement that he relied upon “public news reports to guide my decisions regarding the sale of stocks.”

On Friday morning, Mr. Burr said he “understands the assumption that many could make in hindsight” and asked the Senate Ethics Committee chairman “to open a complete review of the matter with full transparency.”

While some market analysts were warning at the time of the potential damage the emerging coronavirus could cause to the stock market, the sales also came at a time when President Trump and some Republican politicians were playing down the potential harm from the epidemic.

Other senators who were actively trading before the spreading infectious disease caused the markets to fall were Republican Senators Kelly Loeffler and David Perdue of Georgia, and James Inhofe of Oklahoma. The husband of Sen. Dianne Feinstein, the California Democrat, also sold stock before the market downturn.

Ms. Loeffler and Ms. Feinstein, who are both married to investment professionals, said they had been unaware of the trades because they are handled by advisers. Mr. Perdue said his portfolio is managed by an investment adviser who regularly makes dozens of trades and was buying as well as selling shares of companies at the time. Mr. Inhofe in a statement said he also has an investment adviser and doesn’t manage trades.

Mr. Burr, chairman of the Senate Intelligence Committee, which has been receiving frequent briefings on the spread of Covid-19 since it emerged in China, made 33 stock trades on Feb. 13 worth between $628,000 and $1.7 million, according to the filings. Congressional rules require that trades be reported in ranges, not precise figures.

Mr. Burr, who is regarded as the Senate’s leading authority on pandemics as the author of the 2006 Pandemic and All-Hazards Preparedness Act, is also on the Senate health committee, which was briefed on the coronavirus on Jan. 24.

Three of Mr. Burr’s sales were in hotel company stocks—Park Hotels and Resorts Inc., Wyndham Hotels & Resorts Inc. and Extended Stay America Inc. —which have seen their value drop 74%, 63% and 50%, respectively, since Mr. Burr made the sales.

Mr. Burr and his wife also sold between $96,000 and $265,000 in stock between Jan. 31 and Feb. 4, the filings show, including additional shares of Extended Stay.

In an opinion piece published on Fox News online, Mr. Burr said, “Thankfully, the United States today is better prepared than ever before to face emerging public health threats, like the coronavirus.”

Behind closed doors, in a meeting with a small group of constituents in Washington, Mr. Burr warned them to prepare for dire economic effects of the coronavirus, according to a recording obtained by NPR. On Twitter, Mr. Burr called that report a “tabloid-style hit piece.”

On Friday, Mr. Burr explained his trades were motivated by news reports. “Specifically, I closely followed CNBC’s daily health and science reporting out of its Asia bureaus at the time,” he said.

Sales were also reported by two other members of the Intelligence Committee, Mr. Inhofe and Ms. Feinstein.

Between Jan. 27 and Feb. 20, Mr. Inhofe sold between $230,000 and $500,000 of stock in several companies, including Brookfield Asset Management, a real-estate company. Mr. Inhofe in a statement said that his investment adviser has been moving him out of stocks and into mutual funds after he took the chairmanship of the Senate Armed Services Committee in December 2018 “to avoid any appearance of controversy.

Richard Blum, the husband of Ms. Feinstein and a professional investment manager, sold shares of Allogene Therapeutics Inc., a biotech company, on Jan. 31 and Feb. 18 in amounts between $1.5 million and $6 million.

Ms. Feinstein’s spokesman said the senator wasn’t involved in the sales. “All of Senator Feinstein’s assets are in a blind trust, as they have been since she came to the Senate. She has no involvement in any of her husband’s financial decisions,” her spokesman, Tom Mentzer, said in an email.

Matthew Sanderson, a political ethics attorney for Caplin & Drysdale, said he advises his congressional clients either to invest in mutual funds and 401(k)s, or turn investments over to an adviser with a regime to separate the lawmaker for the decision-making.

Mr. Burr’s statement that he acted based upon what he heard from the news media, and not what he learned as a committee chairman, could land him in hot water, Mr. Sanderson said. “That’s pretty weak tea, as for defenses,” Mr. Sanderson said. “That really doesn’t pass muster.”

In 2012, President Obama signed the Stop Trading on Congressional Knowledge Act to outlaw members of Congress and other government staff from engaging in insider trading based on information learned through their jobs.

The public interest group Common Cause filed complaints asking the Justice Department, the Securities and Exchange Commission and the Senate Ethics Committee to investigate the trades of Sens. Burr, Feinstein, Loeffler and Inhofe for possible violations of the law. A Common Cause spokesman said Mr. Perdue’s trades seemed different than those of other senators because they included purchases, as well as sales; still, Common Cause lawyers are considering adding Mr. Perdue to the complaints.

Ms. Loeffler also sits on the Senate’s health committee, which had a closed-door briefing on Jan. 24 about the virus with presentations from the leading U.S. public-health officials, including Dr. Anthony Fauci, the top infectious-diseases specialist in government. That day, Ms. Loeffler reported, she and her husband began making more than two dozen transactions, primarily selling millions of dollars in companies, including retailers AutoZone Inc. and Ross Stores Inc. They sold between $1.28 million and $3.1 million in stock.

By selling stock when they did, Ms. Loeffler and her husband avoided at least $480,000 in losses as of market close on March 19. The couple also purchased two stocks in February, one of which rose in value despite the market crash. Citrix Systems Inc., which makes remote computing software, rose nearly 3% value since the couple bought shares on Feb. 14.

Meanwhile, Mr. Inhofe and Mr. Perdue traded smaller amounts and avoided at least $63,000 in losses and $43,000 in losses, respectively, since late January. The stocks Mr. Perdue purchased fell similarly in value.

Ms. Loeffler said neither she nor her husband make her own day-to-day decisions on purchases and sales. She said didn’t learn about these transactions until three weeks after they were made. “This is a ridiculous & baseless attack,” Ms. Loeffler said on Twitter.

Ms. Loeffler’s husband, Jeffrey Sprecher, is the chairman of the New York Stock Exchange.

Ms. Loeffler was appointed to her seat in December after Sen. Johnny Isakson resigned for health reasons and is locked in a fierce intraparty battle for a Senate seat in Georgia. Her primary rival, Rep. Doug Collins, criticized the senator. “It’s a sad situation,” Mr. Collins said.

The stock sales of Ms. Loeffler and Mr. Sprecher were reported earlier by the Daily Beast.

WSJ : Coronavirus Cases Strain New York City Hospitals: ‘We’re Getting Pounded’

Coronavirus Cases Strain New York City Hospitals: ‘We’re Getting Pounded’
Swiftly rising number of patients, sooner than expected, leads to supply shortages and concern about what is to come

New York City hospitals are already straining under the onslaught of novel coronavirus cases, even as state officials say the real peak of the outbreak is nearly a month and a half away.

Doctors at the largest public hospital in New York say equipment shortages have resulted in them wearing the same masks for as long as a week. Emergency-room physicians at another hospital are having to reuse gowns. Some large hospitals already have exceeded the capacity of their intensive-care units.

At least one city hospital, faced with dwindling supply of ventilators amid the surge of coronavirus patients, had to seek more from a sister hospital.

“We’re getting pounded,” said Mangala Narasimhan, a doctor at the Long Island Jewish Medical Center, part of Northwell Health, the largest hospital system in New York. “I’ve been in ICU care for 15 years, and this is the worst I have ever seen things.”

Hospitals expect the problems to mount. Earlier this week, Gov. Andrew Cuomo said the outbreak is expected to peak in 45 days, and by then the state would need tens of thousands of more beds. On Friday, the governor ordered all nonessential workers in the state to stay at home.

In recent days, the number of confirmed cases in New York City more than doubled to 4,408 as a blitz of testing began to reveal the rapid march of the disease, officials said. New York City alone now makes up 42% of total U.S. confirmed cases. Across the entire state, there have been 7,102 total cases and 35 deaths, making up a quarter of nationwide deaths from the illness.

With the onslaught has come a surprise for many health-care workers: Far more young people than they expected are falling very ill. According to data published Friday morning by the New York City Department of Health and Mental Hygiene, 56% of confirmed cases of coronavirus in the city at the time involved patients under the age of 50.

At the Long Island Jewish Medical Center in Queens, several coronavirus patients under 40, including a few in their 20s, were on ventilators in the intensive-care unit as of Thursday. All were healthy before getting the virus, said Dr. Narasimhan.

The Wall Street Journal talked to about 20 medical workers on the front lines of the outbreak at New York area hospitals.

About 90% of Long Island Jewish Medical Center beds were full Thursday after Northwell Health hospitals in recent days sent home about 2,500 patients scheduled for release and canceled elective procedures, said Terry Lynam, a Northwell Health spokesman.

Still the hospital is adding ICU beds, Mr. Lynam said. About half of the hospital’s intensive-care patients have been diagnosed with Covid-19.

Coronavirus cases across Northwell Health’s 23 hospitals have soared in recent days to 250, from around 50, but many were already hospitalized patients who finally received test results, he said.

The swiftness in which patients turn from mildly sick to struggling to breathe and requiring a ventilator is shocking, health-care workers said. “Things have gotten really bad this past week,” one Manhattan nurse said. “We’re all on edge.”

New York officials say the state could need as many as 110,000 hospital beds and 37,000 intensive-care beds for virus-related illnesses as they peak. The state currently has 53,000 hospital beds and 3,000 intensive-care beds, many of them occupied by people with other illnesses.

A doctor at Maimonides Medical Center in Brooklyn said the hospital had no more isolation space for coronavirus patients and was moving less-sick patients to other wings.

“Beds are needed desperately,” read a memo sent to NewYork-Presbyterian Queens nurses on Thursday. “I need you to ACTIVELY participate in the Discharge planning for your patients.”

Saquib Rahim, a doctor working at the Queens hospital, said the number of potential or confirmed cases has surged in the past week, and it is all hands on deck at the hospital. One elderly patient with Covid-19 symptoms died on the floor of the hospital ward.

“We’ve never seen anything like this,” Dr. Rahim said. “We’re praying that somehow we’ll be able to stem the tide.”

A spokeswoman for the NewYork-Presbyterian system declined to comment.

Risks that hospitals will be overwhelmed are higher in places like New York and Seattle, where outbreaks emerged before sweeping closures of businesses, schools and other public places to slow the contagion, said James Lawler, executive director of the Global Center for Health Security at the University of Nebraska Medical Center. New York further delayed some action, which may have left the city more vulnerable, he added. “You never catch up if you take that approach.”

New York City closed its schools Monday after days of pressure.

At Bellevue, the city’s largest public hospital, doctors have been told by supervisors to anticipate as many as a dozen coronavirus-related intubations a day, which is at least five times the amount on a normal day, a Bellevue doctor said. If the current trend continues, “it is totally unsustainable,” the doctor said.

Another health-care worker at Bellevue said hospital engineers are looking at 88 spaces across the hospital that can be turned into ICU rooms.

Meanwhile, the hospital has seen an uptick in employees getting sick. In one department alone at Bellevue, four doctors tested positive for the virus in recent days, while several others are awaiting results, the doctor said. Doctors at various hospitals said they were worried that staff will start to spread the virus, especially without enough tests to consistently check workers.

Public hospitals such as Bellevue and Elmhurst “have what they need to take care of people,” including ventilators and protective equipment, said Mitchell Katz, president and chief executive of NYC Health + Hospitals, which operates the two hospitals.

NYC Health + Hospitals is moving supplies to hospitals in need, including routing ventilators from a Queens hospital to Elmhurst, Dr. Katz said.

In a letter to Gov. Cuomo on Thursday, the New York State Nurses Association said it was “painfully obvious” that their 42,000 members on the front lines don’t have the gear to protect themselves against the virus.

It warned that “hospitals will cease to function” if workers are exposed, according to a copy of the letter viewed by the Journal.

The Manhattan nurse, speaking through tears, raised worries about new Centers for Disease Control and Prevention guidelines that said health-care workers should use a bandanna if masks aren’t available. Weeks ago, the hospital emergency department was quiet. “All of a sudden, the switch got flipped.”

Doctors at Tisch Hospital, part of NYU Langone Health, are reusing masks and gowns, which they tape to the wall in paper bags with their names on them when they aren’t in use, one doctor said.

“These are not normal times,” said Michael Phillips, the chief epidemiologist at NYU Langone, which asks employees to follow the Centers for Disease Control and Prevention guidelines for how to reuse masks. The move will prolong dwindling supplies.

Queens-based Long Island Jewish Medical Center has gone into “surge capacity,” or overflow, as its ICU has filled up, Dr. Narasimhan said. She is seeing three times the number of patients in the ICU today than during a “high” peak flu season, with a significant number of those patients under the age of 60.

“I’ve seen more cases in the last 10 days of severe respiratory illness than we’ve seen in years,” she said. “I’m very worried.”

WSJ : Airbnb Racks Up Hundreds of Millions in Losses Due to Coronavirus

Airbnb Racks Up Hundreds of Millions in Losses Due to Coronavirus
Home-sharing giant considers raising capital; plans to go public this year in disarray, people familiar with the matter say

Airbnb Inc. is considering raising capital from new investors, as the home-sharing giant wrestles with escalating losses due to the devastating impact of the coronavirus pandemic on its global business, according to people close to the company.

The pandemic has also thrown into disarray Airbnb’s plans to go public this year, and the company’s board and investors are divided over the best path forward, according to people familiar with the matter.

The San Francisco-based startup, which lets people list their properties for rent on its marketplace, has racked up hundreds of millions of dollars in losses this year, one of the people said. A spokesman for Airbnb said the company has “$4 billion in liquidity” and is “focused with our board on ways we can help our community weather this crisis.”

It is unlikely that the company will be able to attract investors at its 2017 valuation of $31 billion, when it last raised money, the people familiar with the matter said. The management is mulling how low it is willing to go to seek an injection of capital.

The Wall Street Journal reported last month that Airbnb internally was already valuing the company at less than $31 billion.

Airbnb, one of the nation’s biggest private companies, had planned to make its widely anticipated debut on the public markets this year via a direct listing, which wouldn’t involve raising any additional money.

The company is now considering instead raising cash using an initial public offering, and has held several meetings with its board this month to discuss its approach, the people familiar said. Morgan Stanley and Goldman Sachs Inc. have been appointed as dual-lead underwriters. But an IPO could go ahead only when the virus crisis has eased, stock markets stabilize, and the company’s finances recover to a stable footing, the people familiar said.

An Airbnb spokesman said it “should come as no surprise that in these extraordinary times, like virtually every company in the world, we are regularly consulting with our board to discuss our work.”

Airbnb—caught in the crosshairs of the all-out crisis the virus has created in the global travel industry—now faces evaporating revenues, as well as a backlash from the hosts who are the backbone of its business.

All its major markets are getting hammered. Bookings last week were down year-on-year around 95% in Asia, 75% in Europe—the company’s biggest market—and 50% in the U.S., according to one of the people close to the business. A report last week by Airbnb-analytics firm AirDNA also showed bookings tanking in big cities world-wide. This week’s numbers are much worse, the person said.

A spokesman for the company said the figures weren’t accurate but declined to provide other numbers.

Airbnb’s board had already raised concerns about the company sliding into the red, even before the pandemic upended its business, the Journal previously reported. Executives were grilled at a board meeting late last year on why overheads such as its head office and employee expenses had been allowed to balloon, outpacing even the then-rapid growth in revenue.

Some board members are unhappy that Airbnb didn’t go public last year, when a soaring stock market put premium prices on even unprofitable startups, the people close to the company said. Employees are concerned the listing could now be delayed beyond the end of the year, meaning many valuable stock options will expire, becoming worthless.

One person close to Airbnb said management and the board are working in sync but that outside investors are agitated about the company’s troubles and its response to them.

Brian Chesky, Airbnb’s chief executive, is under intense pressure from employees to go public, after more than 10 years as a private company. He recently sought to reassure staff that a delay won’t happen. In a staff meeting held earlier this month and on a separate phone call with employees last week, he said the company plans to stay the course of going public this year, the people close to the business said.

Some investors are skeptical this will be possible, or question what price the stock might achieve.

The price at which Airbnb shares are trading has fallen sharply, according to people who specialize in the market for private company shares.

Before the pandemic hit, shares were trading privately at more than $140, valuing the company around $45 billion to $47 billion, according to Jared Carmel, managing partner at Manhattan Venture Partners, a secondary-market specialist. Now, he said, “we’re seeing shares tick back to close to $105.” That’s what Airbnb’s shares priced at in its last funding round in 2017, which valued the company at $31 billion, according to Dow Jones VentureSource data.

Private buyers of Airbnb shares are telling sellers they need to drop their valuations significantly. Mitchell Green, a partner with Lead Edge Capital, was approached last week by a broker trying to sell him Airbnb shares. The ask was $30 billion, said Mr. Green. “Call me when they want $10 billion,” Mr. Green said he told the broker.

Airbnb has the right of first refusal on its shares being sold, and demand for the stock has traditionally outstripped supply, which can skew prices, according to Mr. Carmel.

Airbnb has already taken some steps to respond to the crisis. The company this weekend changed its policies to allow consumers to cancel most bookings without cost. This loses Airbnb its fees on the bookings, but also deprives the hosts—who keep most of the money paid by guests—of their income.

Airbnb on Tuesday wrote Congress and the administration asking for tax relief and other measures to help its hosts. The company is the largest home-sharing platform in the U.S., and before the pandemic had more than two million people on average booking every night into its listings world-wide.

In a joint statement posted to the company’s website, Airbnb’s co-founders Mr. Chesky, Joe Gebbia and Nate Blecharczyk said the move to offer full refunds for cancellations was “the responsible thing to do” given the guidance of governments and health experts. They added that they realized it would cause “incredible hardship” for many of their hosts.

That hasn’t mollified everyone affected. Mr. Blecharczyk’s tweet on the congressional requests provoked a storm of online comments from hosts. One typical response: “That’s nice that you’re asking the government to bail us out with loans since @Airbnb has bankrupted us. I literally have $23 in my bank account right now.” Others questioned the plight of hosts outside the U.S.

Messrs. Chesky, Gebbia and Blecharczyk, who in 2008 founded what was originally called Airbed & Breakfast, said this week they are confident their business will survive.

“While it’s clear to all of us that the coronavirus has deeply impacted our community, we know that this moment will pass and travel will be back,” the co-founders said in a joint statement. It added that people were already “starting to use Airbnb for long-term bookings and stays close-by.”

WSJ : OPEC, U.S. Shale Producers Open Talks Amid Oil Rout

OPEC, U.S. Shale Producers Open Talks Amid Oil Rout
Proposed cuts in U.S. oil output seen as way to help OPEC broker truce in Saudi-Russia price war

U.S. oil industry regulators opened a dialogue with OPEC in talks that could help foster a truce between the world’s three largest oil producers and potentially resolve a Saudi-Russian price war that has devastated oil markets in recent weeks, according to people familiar with the matter.

Mohammed Barkindo, secretary-general of the Organization of the Petroleum Exporting Countries, spoke Friday with Ryan Sitton, the Texas railroad commissioner who oversees the U.S.’s biggest oil patch, these people said.

“Just got off the phone with OPEC SG Moh[ammed] Barkindo. Great conversation on global supply and demand,” Mr. Sitton said on Twitter. “We all agree an international deal must get done to ensure economic stability as we recover from COVID-19.“ The Texan official said the OPEC chief had invited him to the next meeting of the organization in June.

U.S. antitrust laws prevent a formal deal and there is no suggestion the two sides would coordinate on production decisions. But the Texas regulator is considering curtailing output in America’s largest oil-producing state for the first time in decades, people familiar with the matter have previously said.

Mr. Sitton said he would gauge international reaction to the idea of production cuts before deciding how to proceed. “I’m not advocating for Texas to do anything on its own,” he said in an interview.

Meanwhile, Wayne Christian, the Texas commission’s chairman, said he has a number of reservations about a production curtailment.

Shale-oil companies, which are heavily in debt and produce at a higher break-even price compared with conventional Russia and Saudi producers, have been hit hard by the slump. That has led in recent days to stepped-up U.S. engagement with OPEC—which President Trump has often accused of anticompetitive behavior.

U.S. shale companies have complained to Mr. Barkindo about collapsing oil prices and he has also spoken to Frank Fannon, the senior State Department official in charge of energy matters, according to Saudi officials.

Earlier this month, Saudi-led OPEC and Russia were unable to reach a deal on reducing output in response to the coronavirus pandemic, Moscow decided to target U.S. shale production with lower oil prices but was taken aback by Riyadh’s harsh response: price cuts and production hikes that triggered an oil-price collapse below $30 a barrel.

A decision by American producers to reduce output would help the Kremlin claim a victory and spur Russia to resume talks with Saudi Arabia, Saudi officials said.

Saudi officials expect Russia will ultimately return to the table as lower crude prices dent its economy, but only if it can present the oil diplomacy as a face-saving move, according to officials in the kingdom.

A Saudi official said “the perfect [scenario] would be the U.S. giving their word over this and that would make it easier to convince everyone to cooperate.”

FT : Airbus to reopen Spanish and French plants

Airbus to reopen Spanish and French plants
Aircraft maker plans measures to limit risk of virus being spread among workers

Airbus will on Monday reopen its factories in France and Spain at lower initial production rates than before the closure, raising questions over future output as airlines seek to defer aircraft deliveries amid an unprecedented global crisis in aviation.

The group is also understood to have held discussions with the French and German governments about support for the aerospace sector. However, a person with knowledge of the situation said the company was not looking for direct aid in the short-term, although it would not ignore initiatives open to all industries to support the retention of workers. It was more concerned about the pressure on its suppliers, the person said.

In that context Airbus is pressing ahead with plans to keep production going even as its customers ground the majority of their fleets and seek to defer deliveries. Its French and Spanish factories were shut on Tuesday for four days to implement health and safety measures in the face of the spiralling coronavirus pandemic.

After days of discussions with French unions, which have been pushing to defer the reopening of the factories, the company will on Monday signal that it expects business to continue as usual, several people close to the situation said.

Nevertheless, measures taken to reduce the risks of spreading the virus — such as split shifts and changing the flow of work to increase distance between workers — would affect productivity in the early phase of reopening.

Analysts and investors have become increasingly convinced Airbus will have to cut rates of production — an important guide to expected cash flow — on both its widebody and narrow-body aircraft.

The decision to reopen after just four days at a lower rate was an important signal, said Sash Tusa, aerospace analyst at Agency Partners.

“This is the start of the rate cuts,” he said. The aircraft maker could not openly state that it was intending to lower rates, he suggested, as that would weaken its position in negotiations with airlines seeking to defer deliveries.

Airbus had targeted 880 deliveries for 2020, up from 863 in 2019. This now looks to be in doubt. The Financial Times reported this month that the European aircraft maker was reviewing its delivery targets for this year, although no decision was likely to be taken before the end of the first quarter.

Two people familiar with the company’s thinking said that even if first-quarter deliveries were lower than expected the group had a record of catching up in the second half to meet its target. But they admitted that the situation was changing so rapidly that there could be no guarantee.

Airbus is also preparing to invest more heavily in financing its customers in an attempt to keep the production lines working, said one senior executive.

Mr Tusa said that while Airbus might manage to deliver close to its target this year, he expected “a multi-year downturn, with production not returning to the levels of 2019 [863 aircraft] within our forecast period [to 2027]”.

Sandy Morris, aerospace analyst at Jefferies, is predicting deliveries will fall to 650 this year and 600 in 2021, which would have a severe impact on earnings and cash. He suggested Airbus’s home countries of France, Germany, the UK and Spain, could provide assistance to the aircraft maker and its suppliers by purchasing 500-600 passenger jets over three years.

“We estimate the cash spend at €28.5bn-€34.2bn,” said Mr Morris. “New aircraft are normally not bad assets to own. The aircraft would be delivered to airlines broadly as scheduled. Airbus deliveries might fall to around 600 per annum, but it can weather that, in our view.”

FT : UK government draws up plans to buy into airlines

UK government draws up plans to buy into airlines
Taxpayer injection for British Airways and other companies in return for shares

The UK government is drawing up plans to buy equity stakes in airlines and other companies hardest hit by the coronavirus crisis after being warned that the economic packages it has announced so far will not be enough to save them.

The plans would see the UK taxpayer inject billions of pounds into companies including British Airways in exchange for shares that would eventually be sold back to private investors, according to three people briefed on the proposals.

Two of the people said the government was contemplating the move after being warned by bankers that the support it has already unveiled — including £330bn of loan guarantees — would not be enough to stave off the collapse of companies that had seen their revenues all but evaporate.

“They are coming up with a Tarp-like programme for certain industries like the airlines,” said one of the people, referencing the US troubled asset relief programme that was rolled out during the financial crisis to support American banks.

“There are certain industries where there will need to be an infusion of capital in exchange for equity,” they said. “The challenge with a loan is if you make a loan to a company with no revenues, then accounting will say it's impaired.”

They added: “For those companies that are really virtually shut down because of this virus a loan in many ways is not going to work.”

The person said that, in addition to airlines, “at some point the government will need to think about all the industries and businesses that might be severely impaired”.

“The airlines are obvious, but there will be others,” they said.

A second person briefed on the plans said that some companies had entered the coronavirus crisis with too much debt which would restrict how much extra borrowing they could take on. 

They said: “The key is to address the companies that will require some equity capital on top of loans, as the financial structure of each company has limits to accommodate more debt, depending on their sector and existing financial structure.”

One of the people warned that the proposal was complex and might not come to fruition.

One UK official confirmed that the talks were taking place and admitted that the state could end up with equity stakes in the airlines. He said the government was being advised by bankers from Rothschild, the investment bank.

However, he cautioned that while the Tarp-type scheme was being discussed the final outcome could turn out to be “more complicated”.

Some airlines had been hoping for a more conventional rescue involving state loans and relief on airport charges and air passenger duty but ministers believe this would not necessarily be enough to keep them afloat during a sustained shutdown in the global aviation industry.

Aviation executives made those demands at a meeting with ministers on Wednesday.

Grant Shapps, the UK transport secretary. promised this week that the government would not allow the collapse of “world-leading, well-run, profitable” airlines and said an announcement would be made imminently.

Policymakers in the US have also raised the prospect of taking equity stakes in their domestic airlines.

A stimulus bill unveiled by Senate Republicans earlier this week earmarked $50bn in loans and loan guarantees to airlines. But it also said the government could take stakes in the companies through different kinds of securities in order to participate in the “gains” of its investments.

A spokesperson for British Airways declined to comment. 

Wash. Post : U.S. intelligence reports from January and February warned about a

U.S. intelligence reports from January and February warned about a likely pandemic
Officials reported that China appeared to be downplaying the outbreak and said swift action could be needed to contain the coronavirus.

https://www.washingtonpost.com/national-security/us-intelligence-reports-from-ja
nuary-and-february-warned-about-a-likely-pandemic/2020/03/20/299d8cda-6ad5-11ea-
b5f1-a5a804158597_story.html


U.S. intelligence agencies were issuing ominous, classified warnings in January and February about the global danger posed by the coronavirus while President Trump and lawmakers played down the threat and failed to take action that might have slowed the spread of the pathogen, according to U.S. officials familiar with spy agency reporting.

The intelligence reports didn’t predict when the virus might land on U.S. shores or recommend particular steps that public health officials should take, issues outside the purview of the intelligence agencies. But they did track the spread of the virus in China, and later in other countries, and warned that Chinese officials appeared to be minimizing the severity of the outbreak.

Taken together, the reports and warnings painted an early picture of a virus that showed the characteristics of a globe-encircling pandemic that could require governments to take swift actions to contain it. But despite that constant flow of reporting, Trump continued publicly and privately to play down the threat the virus posed to Americans. Lawmakers, too, did not grapple with the virus in earnest until this month, as officials scrambled to keep citizens in their homes and hospitals braced for a surge in patients suffering from covid-19, the disease caused by the coronavirus.

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Intelligence agencies “have been warning on this since January,” said a U.S. official who had access to intelligence reporting that was disseminated to members of Congress and their staffs as well as to officials in the Trump administration, and who, along with others, spoke on the condition of anonymity to describe sensitive information.

Coronavirus cases rose as Trump said they were under control
At least seven times over the past two months, President Trump said the number of coronavirus cases in the U.S. were falling or contained even as they rose. (Video: JM Rieger/Photo: Jabin Botsford/The Washington Post)
“Donald Trump may not have been expecting this, but a lot of other people in the government were — they just couldn’t get him to do anything about it,” this official said. “The system was blinking red.”

Shut in and stir-crazy: Grappling with a new reality

Spokespeople for the CIA and the Office of the Director of National Intelligence declined to comment, and a White House spokesman rebutted criticism of Trump’s response.

“President Trump has taken historic, aggressive measures to protect the health, wealth and safety of the American people — and did so, while the media and Democrats chose to only focus on the stupid politics of a sham illegitimate impeachment,” Hogan Gidley said in a statement. “It’s more than disgusting, despicable and disgraceful for cowardly unnamed sources to attempt to rewrite history — it’s a clear threat to this great country.”

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Public health experts have criticized China for being slow to respond to the coronavirus outbreak, which originated in Wuhan, and have said precious time was lost in the effort to slow the spread. At a White House briefing Friday, Health and Human Services Secretary Alex Azar said officials had been alerted to the initial reports of the virus by discussions that the director of the Centers for Disease Control and Prevention had with Chinese colleagues on Jan. 3.

The warnings from U.S. intelligence agencies increased in volume toward the end of January and into early February, said officials familiar with the reports. By then, a majority of the intelligence reporting included in daily briefing papers and digests from the Office of the Director of National Intelligence and the CIA was about covid-19, said officials who have read the reports.

The surge in warnings coincided with a move by Sen. Richard Burr (R-N.C.) to sell dozens of stocks worth between $628,033 and $1.72 million. As chairman of the Senate Intelligence Committee, Burr was privy to virtually all of the highly classified reporting on the coronavirus. Burr issued a statement Friday defending his sell-off, saying he sold based entirely on publicly available information, and he called for the Senate Ethics Committee to investigate.

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A key task for analysts during disease outbreaks is to determine whether foreign officials are trying to minimize the effects of an outbreak or take steps to hide a public health crisis, according to current and former officials familiar with the process.

At the State Department, personnel had been nervously tracking early reports about the virus. One official noted that it was discussed at a meeting in the third week of January, around the time that cable traffic showed that U.S. diplomats in Wuhan were being brought home on chartered planes — a sign that the public health risk was significant. A colleague at the White House mentioned how concerned he was about the transmissibility of the virus.

“In January, there was obviously a lot of chatter,” the official said.

Inside the White House, Trump’s advisers struggled to get him to take the virus seriously, according to multiple officials with knowledge of meetings among those advisers and with the president.

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Azar couldn’t get through to Trump to speak with him about the virus until Jan. 18, according to two senior administration officials. When he reached Trump by phone, the president interjected to ask about vaping and when flavored vaping products would be back on the market, the senior administration officials said.

On Jan. 27, White House aides huddled with then-acting chief of staff Mick Mulvaney in his office, trying to get senior officials to pay more attention to the virus, according to people briefed on the meeting. Joe Grogan, the head of the White House Domestic Policy Council, argued that the administration needed to take the virus seriously or it could cost the president his reelection, and that dealing with the virus was likely to dominate life in the United States for many months.

Mulvaney then began convening more regular meetings. In early briefings, however, officials said Trump was dismissive because he did not believe that the virus had spread widely throughout the United States.

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By early February, Grogan and others worried that there weren’t enough tests to determine the rate of infection, according to people who spoke directly to Grogan. Other officials, including Matthew Pottinger, the president’s deputy national security adviser, began calling for a more forceful response, according to people briefed on White House meetings.

But Trump resisted and continued to assure Americans that the coronavirus would never run rampant as it had in other countries.

“I think it’s going to work out fine,” Trump said on Feb. 19. “I think when we get into April, in the warmer weather, that has a very negative effect on that and that type of a virus.”

“The Coronavirus is very much under control in the USA,” Trump tweeted five days later. “Stock Market starting to look very good to me!”

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But earlier that month, a senior official in the Department of Health and Human Services delivered a starkly different message to the Senate Intelligence Committee, in a classified briefing that four U.S. officials said covered the coronavirus and its global health implications.

Robert Kadlec, the assistant secretary for preparedness and response — who was joined by intelligence officials, including from the CIA — told committee members that the virus posed a “serious” threat, one of those officials said.

Kadlec didn’t provide specific recommendations, but he said that to get ahead of the virus and blunt its effects, Americans would need to take actions that could disrupt their daily lives, the official said. “It was very alarming.”

Trump’s insistence on the contrary seemed to rest in his relationship with China’s President Xi Jingping, whom Trump believed was providing him with reliable information about how the virus was spreading in China, despite reports from intelligence agencies that Chinese officials were not being candid about the true scale of the crisis.

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Some of Trump’s advisers told him that Beijing was not providing accurate numbers of people who were infected or who had died, according to administration officials. Rather than press China to be more forthcoming, Trump publicly praised its response.

“China has been working very hard to contain the Coronavirus,” Trump tweeted Jan. 24. “The United States greatly appreciates their efforts and transparency. It will all work out well. In particular, on behalf of the American People, I want to thank President Xi!”

Some of Trump’s advisers encouraged him to be tougher on China over its decision not to allow teams from the CDC into the country, administration officials said.

In one February meeting, the president said that if he struck a tougher tone against Xi, the Chinese would be less willing to give the Americans information about how they were tackling the outbreak.

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Trump on Feb. 3 banned foreigners who had been in China in the previous 14 days from entering the United States, a step he often credits for helping to protect Americans against the virus. He has also said publicly that the Chinese weren’t honest about the effects of the virus. But that travel ban wasn’t accompanied by additional significant steps to prepare for when the virus eventually infected people in the United States in great numbers.

As the disease spread beyond China, U.S. spy agencies tracked outbreaks in Iran, South Korea, Taiwan, Italy and elsewhere in Europe, the officials familiar with those reports said. The majority of the information came from public sources, including news reports and official statements, but a significant portion also came from classified intelligence sources. As new cases popped up, the volume of reporting spiked.

As the first cases of infection were confirmed in the United States, Trump continued to insist that the risk to Americans was small.

“I think the virus is going to be — it’s going to be fine,” he said on Feb. 10.

“We have a very small number of people in the country, right now, with it,” he said four days later. “It’s like around 12. Many of them are getting better. Some are fully recovered already. So we’re in very good shape.”

On Feb. 25, Nancy Messonnier, a senior CDC official, sounded perhaps the most significant public alarm to that point, when she told reporters that the coronavirus was likely to spread within communities in the United States and that disruptions to daily life could be “severe.” Trump called Azar on his way back from a trip to India and complained that Messonnier was scaring the stock markets, according to two senior administration officials.

Trump eventually changed his tone after being shown statistical models about the spread of the virus from other countries and hearing directly from Deborah Birx, the coordinator of the White House coronavirus task force, as well as from chief executives last week rattled by a plunge in the stock market, said people ­familiar with Trump’s conversations.

But by then, the signs pointing to a major outbreak in the United States were everywhere.

>>> This week's biggest % gainers/losers The following are this wee

This week's biggest % gainers/losers The following are this week's top percentage gainers and losers, categorized by sectors (over $300 mln market cap and 100K average daily volume)

This week's top % gainers
  • Healthcare: OMI (5.91 +35.55%), MRNA (28.2 +32.39%), CASI (1.98 +25.32%)
  • Materials: MAG (7.82 +57.34%), FSM (2.26 +25.56%), OR (6.51 +23.76%)
  • Industrials: AAWW (22.93 +28.1%)
  • Consumer Discretionary: FRGI (10.99 +106.19%)
  • Financials: SQQQ (29.32 +26.82%)
  • Energy: TUSK (1.16 +65.71%), DK (15.08 +46.27%)
  • Consumer Staples: UNFI (11.22 +96.15%), RAD (17.63 +50.68%), SPTN (15.03 +44.1%), BGS (17.61 +27.52%), FDP (34.31 +25.4%)
This week's top % losers
  • Industrials: FLY (4.10 -59.8%),
  • Consumer Discretionary: RUTH (4.11 -66.93%), GIII (6.06 -60.08%), BJRI (8.2 -59.59%), AGS (1.63 -59.55%), DIN (17.41 -59.21%)
  • Information Technology: EVRI (2.92 -60.54%)
  • Financials: GPMT (4.26 -65.65%), NTG (1.14 -65.24%), RWT (4.85 -61.39%), LADR (4.51 -60.58%), CLNC (2.81 -60.31%), MITT (4.56 -58.77%)
  • Consumer Staples: CHEF (5.54 -68.31%)