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Recession fears are centerstage again with US economy sending mixed messages – The Washington Post

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Retail sales jumped 1 percent in June as consumers continue to absorb higher costs, according to federal data released Friday.

While the closely watched metric of the nation’s economic health shows that Americans are still spending, rising retail numbers also threaten to push inflation higher in a hot economy. That could prompt policymakers to take even more forceful action to combat 40-year high inflation.

The report is the first of two out Friday offering insights on Americans’ spending habits and their expectations for the economy.

Consumer sentiment data will be released by the University of Michigan at 10 a.m. will give economists an idea of how Americans are feeling about the economy. Consumer sentiment fell to an all-time low in June, with many Americans worried about long-term inflation.

“We’re at this weird moment where you sort of want the economy to slow. You just don’t want it to go into reverse,” said Jason Furman, an economics professor at Harvard University. “There are a lot of unusual uncertainties that we don’t usually see.”

The looming question is whether the U.S. economy shrank again in the second quarter of 2022, after unexpectedly contracting in the first three months of the year. The next round of gross domestic product figures will be released July 28.

“After flying well above cruising altitude last year, the inevitable descent in economic growth is clearly underway,” Wells Fargo economists wrote in a note on Thursday. “The tight stance of policy alongside still high inflation suggests a recession is more likely than not next year.”

There’s a mix of signals in the business world. On Thursday, two of the nation’s largest banks, JPMorgan Chase and Morgan Stanley, reported lower profits partly because of fewer mergers and initial public offerings on Wall Street. JPMorgan even reported that it was setting funds aside to protect against losses in the event of a downturn. Yet its chief executive, Jamie Dimon, said Americans are better situated to withstand a recession than they were before the financial crisis.

For families, the economy feels more dire. Americans are facing higher prices on everyday essentials like food, gas and housing. New inflation figures released Wednesday showed that prices have risen 9.1 percent in the past year, exceeding economists’ expectations and putting renewed pressure on the Fed to move aggressively to cool the economy.

There are also growing fears that a sharp Fed move could, in turn, could tip the U.S. economy into recession.

“It’s hard to find much encouraging news in the latest inflation report,” said Karen Dynan, an economist at Harvard University and former economist at the Federal Reserve Board. “This was the most important data point the Fed will get prior to its meeting later this month, and it’s probably going to have to intervene more aggressively than it had hoped to in order to restrain demand. And it also raises the odds that they cannot achieve that without a downturn.”

The blistering June inflation report raised questions about whether Fed officials would move even more aggressively to tame inflation at their upcoming policy meeting. Inflation notched yet another peak last month, zapping any hope that the Fed’s moves so far were bringing prices down.

For weeks, policymakers have leaned toward another hike of three-quarters of a percentage point, mirroring the increase they adopted in June. But it was unclear whether they would start to show support for a hike of a full percentage point before their July 26-27 policy meeting.

So far, officials appear to be sticking to their original message. And if anything, they are warning against reacting too suddenly to one bucket of data. On Thursday, Christopher Waller, a member of the Fed’s Board of Governors, said that even though the latest consumer price index report was “a major league disappointment,” there were hazards to snap policy decisions.

“You don’t want to overdo the rate hikes,” Waller said. “A 75 basis-point hike is huge. Don’t think because you’re not going 100, you’re not doing your job.”

The message was echoed by St. Louis Fed President Jim Bullard, who told Nikkei Asia that his preference was to stick to a hike of three-quarters of a percentage point for now. San Francisco Fed President Mary Daly told the New York Times that even though she expected a brutal inflation report, she still favors a hike of three-quarters of a percentage point.

An outlier is Atlanta Fed President Raphael Bostic, who does not have a vote on the Fed’s policy committee this year. Asked about the possibility of a hike of a full percentage point on Wednesday, Bostic told reporters that “everything is in play.”

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Construction wraps on indoor supervised site for people who inhale drugs in Vancouver

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VANCOUVER – Supervised injection sites are saving the lives of drug users everyday, but the same support is not being offered to people who inhale illicit drugs, the head of the BC Centre for Excellence in HIV/AIDS says.

Dr. Julio Montaner said the construction of Vancouver’s first indoor supervised site for people who inhale drugs comes as the percentage of people who die from smoking drugs continues to climb.

The location in the Downtown Eastside at the Hope to Health Research and Innovation Centre was unveiled Wednesday after construction was complete, and Montaner said people could start using the specialized rooms in a matter of weeks after final approvals from the city and federal government.

“If we don’t create mechanisms for these individuals to be able to use safely and engage with the medical system, and generate points of entry into the medical system, we will never be able to solve the problem,” he said.

“Now, I’m not here to tell you that we will fix it tomorrow, but denying it or ignoring it, or throw it under the bus, or under the carpet is no way to fix it, so we need to take proactive action.”

Nearly two-thirds of overdose deaths in British Columbia in 2023 came after smoking illicit drugs, yet only 40 per cent of supervised consumption sites in the province offer a safe place to smoke, often outdoors, in a tent.

The centre has been running a supervised injection site for years which sees more than a thousand people monthly and last month resuscitated five people who were overdosing.

The new facilities offer indoor, individual, negative-pressure rooms that allow fresh air to circulate and can clear out smoke in 30 to 60 seconds while users are monitored by trained nurses.

Advocates calling for more supervised inhalation sites have previously said the rules for setting up sites are overly complicated at a time when the province is facing an overdose crisis.

More than 15,000 people have died of overdoses since the public health emergency was declared in B.C. in April 2016.

Kate Salters, a senior researcher at the centre, said they worked with mechanical and chemical engineers to make sure the site is up to code and abidies by the highest standard of occupational health and safety.

“This is just another tool in our tool box to make sure that we’re offering life-saving services to those who are using drugs,” she said.

Montaner acknowledged the process to get the site up and running took “an inordinate amount of time,” but said the centre worked hard to follow all regulations.

“We feel that doing this right, with appropriate scientific background, in a medically supervised environment, etc, etc, allows us to derive the data that ultimately will be sufficiently convincing for not just our leaders, but also the leaders across the country and across the world, to embrace the strategies that we are trying to develop.” he said.

Montaner said building the facility was possible thanks to a single $4-million donation from a longtime supporter.

Construction finished with less than a week before the launch of the next provincial election campaign and within a year of the next federal election.

Montaner said he is concerned about “some of the things that have been said publicly by some of the political leaders in the province and in the country.”

“We want to bring awareness to the people that this is a serious undertaking. This is a very massive investment, and we need to protect it for the benefit of people who are unfortunately drug dependent.” he said.

This report by The Canadian Press was first published Sept. 18, 2024.

The Canadian Press. All rights reserved.

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N.B. election: Parties’ answers on treaty rights, taxes, Indigenous participation

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FREDERICTON – The six chiefs of the Wolastoqey Nation in New Brunswick distributed a survey on Indigenous issues to political parties ahead of the provincial election, which is scheduled to kick off Thursday. Here are some of the answers from the Progressive Conservative, Liberal and Green parties.

Q: How does your party plan to demonstrate a renewed commitment to recognizing our joint treaty responsibilities and acknowledging that the lands and waters of this territory remain unceded?

Progressive Conservative: The party respectfully disagrees with the assertion that land title has been unceded. This is a legal question that has not been determined by the courts.

Liberal: When we form government, the first conversations the premier-designate will have is with First Nations leaders. We will publicly and explicitly acknowledge your treaty rights, and our joint responsibility as treaty people.

Green: The Green Party acknowledges that New Brunswick is situated on the unceded and unsurrendered territories of the Wolastoqiyik, Mi’kmaq and Peskotomuhkati peoples, covered by the Treaties of Peace and Friendship. Our party is committed to establishing true nation-to-nation relationships with First Nations, grounded in mutual respect and co-operation as the treaties intended.

Q: How does your party propose to approach the issue of provincial tax agreements with First Nations?

Progressive Conservative: The government of New Brunswick operates in a balanced and fair manner with all organizations, institutions and local governments that represent the citizens of this province, including First Nations. Therefore, we cannot offer tax agreements that do not demonstrate a benefit to all citizens.

Liberal: Recent discussions with First Nations chiefs shed light on the gaps that existed in the previous provincial tax agreements with First Nations. Our party is committed to negotiating and establishing new tax agreements with First Nations that address the local needs and priorities and ensure all parties have a fair deal.

Green: The Green Party is committed to fostering a respectful relationship with First Nations in New Brunswick and strongly opposes Premier Blaine Higgs’s decision to end tax-sharing agreements. We believe reinstating these agreements is crucial for supporting the economic development and job creation in First Nation communities.

Q: How will your party ensure more meaningful participation of Indigenous communities in provincial land use and resource management decision-making?

Progressive Conservative: The government of New Brunswick has invested significant resources in developing a robust duty to consult and engagement process. We are interested in fully involving First Nations in the development of natural resources, including natural gas development. We believe that the development of natural gas is better for the environment — because it allows for the shutdown of coal-fired power plants all over the globe — and it allows for a meaningful step along the path to reconciliation.

Liberal: Our party is focused on building strong relations with First Nations and their representatives based on mutual respect and a nation-to-nation relationship, with a shared understanding of treaty obligations and a recognition of your rights. This includes having First Nations at the table and engaged on all files, including land-use and resource management.

Green: We will develop a new Crown lands management framework with First Nations, focusing on shared management that respects the Peace and Friendship Treaties. We will enhance consultation by developing parameters for meaningful consultation with First Nations that will include a dispute resolution mechanism, so the courts become the last resort, not the default in the face of disagreements.

This report by The Canadian Press was first published Sept. 18, 2024.

The Canadian Press. All rights reserved.

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Canadian Coast Guard crew member lost at sea off Newfoundland

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ST. JOHN’S, N.L. – A crew member of a Canadian Coast Guard ship has been lost at sea off southern Newfoundland.

The agency said in a release Wednesday that an extensive search and rescue effort for the man was ended Tuesday evening.

He was reported missing on Monday morning when the CCGS Vincent Massey arrived in St. John’s, N.L.

The coast guard says there was an “immediate” search on the vessel for the crew member and when he wasn’t located the sea and air search began.

Wednesday’s announcement said the agency was “devastated to confirm” the crew member had been lost at sea, adding that decisions to end searches are “never taken lightly.”

The coast guard says the employee was last seen on board Sunday evening as the vessel sailed along the northeast coast of Newfoundland.

Spokeswoman Kariane Charron says no other details are being provided at this time and that the RCMP will be investigating the matter as a missing person case.

This report by The Canadian Press was first published Sept. 18, 2024.

The Canadian Press. All rights reserved.

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