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The Canadian Press

White House begins talks with lawmakers on COVID-19 relief

WASHINGTON — Top aides to President Joe Biden on Sunday began talks with a group of moderate Senate Republicans and Democrats on a $1.9 trillion coronavirus relief package as Biden faces increasing headwinds in his effort to win bipartisan backing for the initial legislative effort of his presidency. Lawmakers on the right question the wisdom of racking up bigger deficits while those on the left are urging Biden not to spend too much time on bipartisanship when the pandemic is killing thousands of Americans each day and costing more jobs amid tightening restrictions in many communities. At least a dozen senators met for an hour and 15 minutes in a virtual call with White House National Economic Council director Brian Deese and other senior White House officials. Many hope to approve a relief package before former President Donald Trump’s trial, which is set to begin in two weeks, overtakes Washington’s attention. Sen. Angus King, an independent from Maine, called the opening talks a “serious effort.” “There was not a hint of cynicism or lack of commitment to at least trying to work something out,” King said. “If they were just trying to jam this through, I don’t think it would have interrupted the Packers game.” King told reporters that there was “absolute consensus” among the group that the No. 1 priority was to speed up the distribution of vaccinations and expanding COVID-19 testing and tracing. The White House did not seem to budge on breaking up the package or reducing the overall price tag, even as it pushes for bipartisan support. There was also no discussion of pushing it through on a procedural move that could be done without Republicans, King said. One key Republican, Sen. Susan Collins of Maine, said afterward, “It seems premature to be considering a package of this size and scope.” Collins said instead she would pull the bipartisan group together “and see if we could come up with a more targeted package.” She said in a statement that a bill with additional funding for vaccine distribution “would be useful.” Senators from both parties raised questions about the economic aid provisions, particularly making direct $1,400 payments to Americans more tailored to recipients based on need. Senators also wanted more data on how the White House reached the $1.9 trillion figure. Many of the senators are from a bipartisan group that struck the contours of the last COVID-19 deal approved late last year. They were joined on the call by the two leaders of the House’s Problem Solvers Caucus, Reps. Josh Gottheimer, D-N.J., and Tom Reed, R-N.Y., who were also part of earlier discussions. Sen. Jeanne Shaheen, D-N.H., told The Associated Press that no red lines were drawn. But she added there was consensus among the call’s participants “that the more targeted the aid is the more effective it can be.” Overall, “it was a conversation and it was not about drawing lines in the sand,” Shaheen said. “It was about how can we work together to help the people of this country.” White House coronavirus response co-ordinator Jeff Zients and White House legislative affairs director Louisa Terrell also joined the call. Out of the gate, Biden has made clear that quickly passing another round of coronavirus relief is a top priority as he seeks to get the surging pandemic and the related economic crisis under control, while demonstrating he can break the gridlock that has ailed Congress for much of the last two presidencies. Biden and his aides in their public comments have stressed that his plan is a starting point and that finding common ground on relief should be attainable considering the devastating impact the pandemic is exacting on Democratic and Republican states alike. With more than 412,000 dead and the economy again losing jobs, Biden has argued there is no time to lose. “We’re going to continue to push because we can’t wait,” said White House principal deputy press secretary Karine Jean-Pierre. “Just because Washington has been gridlocked before doesn’t mean it needs to continue to be gridlocked Central to Biden’s campaign pitch, beyond healing the wounds created by Trump’s presidency, was that he was a proven bipartisan dealmaker, one who would draw upon his decades in the Senate and deep relationships with Republicans to bridge partisan divides. Some Biden advisers watched with worry as the Senate, just days into the president’s term, was already in gridlock as to a power-sharing agreement, with Republican leader Mitch McConnell refusing to budge on a demand to keep the filibuster intact. If the Senate twists itself in knots over its very basics, some Democrats wondered, how could it reach a big deal? Additionally, some of Biden’s preferred methods to lobby and schmooze have been curtailed by the pandemic. Though his address book remains one of the best in Washington, it stands to be far more difficult for Biden — at least for the foreseeable future — to engage in the face-to-face politicking that he prefers. Sen. Mitt Romney, R-Utah, ahead of the meeting, raised concerns again about the wisdom of the government engaging in massive deficit spending. “If we get beyond COVID, I believe that the economy is going to come roaring back,” Romney told “Fox News Sunday.” “And spending and borrowing trillions of dollars from the Chinese, among others, is not necessarily the best thing we can do to get our economy to be strong long-term. Sen. Bernie Sanders, the Vermont independent who caucuses with Democrats, said he didn’t have high hopes for negotiations leading to Republican support and suggested Democrats may need to use budget reconciliation to pass it with a simple majority. The procedural tool would allow Democrats to push the package to approval without the 60-vote threshold typically needed to advance legislation past a filibuster. Republicans used the same tool to pass tax cuts during the Trump administration. “What we cannot do is wait weeks and weeks and months and months to go forward,” Sanders said. “We have got to act now. That is what the American people want. “ ___ Associated Press writer Jonathan Lemire contributed to this report. Aamer Madhani And Lisa Mascaro, The Associated Press

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GameStop falls 27% on potential share sale

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Shares of GameStop Corp lost more than a quarter of their value on Thursday and other so-called meme stocks also declined in a sell-off that hit a broad range of names favored by retail investors.

The video game retailer’s shares closed down 27.16% at $220.39, their biggest one-day percentage loss in 11 weeks. The drop came a day after GameStop said in a quarterly report that it may sell up to 5 million new shares, sparking concerns of potential dilution for existing shareholders.

“The threat of dilution from the five million-share sale is the dagger in the hearts of GameStop shareholders,” said Jake Dollarhide, chief executive officer of Longbow Asset Management. “The meme trade is not working today, so logic for at least one day has returned.”

Soaring rallies in the shares of GameStop and AMC Entertainment Holdings over the past month have helped reinvigorate the meme stock frenzy that began earlier this year and fueled big moves in a fresh crop of names popular with investors on forums such as Reddit’s WallStreetBets.

Many of those names traded lower on Thursday, with shares of Clover Health Investments Corp down 15.2%, burger chain Wendy’s falling 3.1% and prison operator Geo Group Inc, one of the more recently minted meme stocks, down nearly 20% after surging more than 38% on Wednesday. AMC shares were off more than 13%.

Worries that other companies could leverage recent stock price gains by announcing share sales may be rippling out to the broader meme stock universe, said Jack Ablin, chief investment officer at Cresset Capital.

AMC last week took advantage of a 400% surge in its share price since mid-May to announce a pair of stock offerings.

“It appears that other companies, like GameStop, are hoping to follow AMC’s lead by issuing shares and otherwise profit from the meme stocks run-up,” Ablin said. “Investors are taking a dim view of that strategy.”

Wedbush Securities on Thursday raised its price target on GameStop to $50, from $39. GameStop will likely sell all 5 million new shares but that amount only represents a “modest” dilution of 7%, Wedbush analysts wrote.

GameStop on Wednesday reported stronger-than-expected earnings, and named the former head of Amazon.com Inc’s Australian business as its chief executive officer.

GameStop’s shares rallied more than 1,600% in January when a surge of buying forced bearish investors to unwind their bets in a phenomenon known as a short squeeze.

The company on Wednesday said the U.S. Securities and Exchange Commission had requested documents and information related to an investigation into that trading.

In the past two weeks, the so-called “meme stocks” have received $1.27 billion of retail inflows, Vanda Research said on Wednesday, matching their January peak.

 

(Reporting by Aaron Saldanha and Sagarika Jaisinghani in Bengaluru and Sinead Carew in New York; Additional reporting by Ira Iosebashvili; Editing by Sriraj Kalluvila, Shounak Dasgupta, Jonathan Oatis and Nick Zieminski)

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U.S. to work with allies to secure electric vehicle metals

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The United States must work with allies to secure the minerals needed for electric vehicle batteries and process them domestically in light of environmental and other competing interests, the White House said on Tuesday.

The strategy, first reported by Reuters in late May, will include new funding to expand international investments in electric vehicles (EV) metal projects through the U.S. Development Finance Corporation, as well as new efforts to boost supply from recycling batteries.

The U.S. has been working to secure minerals from allied countries, including Canada and Finland. The 250-page report outlining policy recommendations mentioned large lithium supplies in Chile and Australia, the world’s two largest producers of the white battery metal.

President Joe Biden‘s administration will also launch a working group to identify where minerals used in EV batteries and other technologies can be produced and processed domestically.

Securing enough copper, lithium and other raw materials to make EV batteries is a major obstacle to Biden’s aggressive EV adoption plans, with domestic mines facing extensive regulatory hurdles and environmental opposition.

The White House acknowledged China’s role as the world’s largest processor of EV metals and said it would expand efforts to lessen that dependency.

“The United States cannot and does not need to mine and process all critical battery inputs at home. It can and should work with allies and partners to expand global production and to ensure secure global supplies,” it said in the report.

The White House also said the Department of the Interior and others agencies will work to identify gaps in mine permitting laws to ensure any new production “meets strong standards” in terms of both the environment and community input.

The report noted Native American opposition to Lithium Americas Corp’s Thacker Pass lithium project in Nevada, as well as plans by automaker Tesla Inc to produce its own lithium.

The steps come after Biden, who has made fighting climate change and competing with China centerpieces of his agenda, ordered a 100-day review of gaps in supply chains in key areas, including EVs.

Democrats are pushing aggressive climate goals to have a majority of U.S.-manufactured cars be electric by 2030 and every car on the road to be electric by 2040.

As part of the recommendations from four executive branch agencies, Biden is being advised to take steps to restore the country’s strategic mineral stockpile and expand funding to map the mineral resources available domestically.

Some of those steps would require the support of Congress, where Biden’s fellow Democrats have only slim majorities.

The Energy Department already has $17 billion in authority through its Advanced Technology Vehicles Manufacturing Loan program to fund some investments.

The program’s administrators will focus on financing battery manufacturers and companies that refine, recycle and process critical minerals, the White House said.

(Reporting by Trevor Hunnicutt in Washington and Ernest Scheyder in Houston; Editing by Mary Milliken, Aurora Ellis and Sonya Hepinstall)

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Mining rig maker Canaan argues against wholesale crackdown on bitcoin mining in China

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A major Chinese maker of bitcoin mining machines argued against an indiscriminate crackdown on cryptocurrency mining in China, saying the business helps make better use of electricity and contributes to employment and the local economy.

Zhang Nangeng, CEO of Nasdaq-listed Canaan Inc, told an earnings conference call that although cryptomining activities using fossil-fuel power hampers Beijing’s green efforts, those powered by clean energy should be spared from the crackdown.

“For-profit miners prefer regions with low electricity prices that indicate oversupply, and likely energy waste,” Zhang said.

In addition, “bitcoin miners also help create jobs in impoverished regions and contribute to fiscal coffers.”

Zhang’s comments come after China’s State Council, last month, ordered a crackdown on energy intensive bitcoin mining and trading, and Inner Mongolia, a major mining centre, proposed measures to root out the practice.

Energy regulators in southwest Sichuan – a province rich in hydropower – met local power generators on Wednesday to probe cryptomining in China’s second-biggest bitcoin production hub.

Bitcoin and other cryptocurrencies are created or “mined” by high-powered computers competing to solve complex mathematical puzzles in an energy-intensive process that often relies on fossil fuels, particularly coal.

Canaan makes machines, or rigs, to mine bitcoins.

Zhang said policy uncertainty is prodding domestic miners to move overseas, and causing some clients to hold off placing new orders for mining equipment.

Beijing’s crackdown is also prompting some miners to “undersell” mining equipment, helping knock-down prices, Zhang said.

Spot prices of bitcoin mining machines are down 20%-30% from roughly a month ago, hurt by falling bitcoin prices.

To reduce business uncertainty, Canaan is accelerating overseas expansion, securing long-term contracts, and setting up its own offshore bitcoin mining business.

Canaan, which on Tuesday reported a nearly 500% surge in first-quarter sales to 402.8 million yuan ($63.12 million), said overseas markets now contributes to 78.4% of its total revenues. That compares with just 4.9% in the first quarter of 2020.

Orders from overseas clients, including Canada‘s Hive Blockchain Technologies, and U.S. crypto player Core Scientific, also account for more than 70% of total orders.

Canaan is also expanding into bitcoin mining itself, having set up an office in Singapore, and is preparing to launch a cryptomining business in Kazakhstan, in central Asia.

“Just as it took a long time for bitcoin to be recognized by the market, there will also be a (long) process for bitcoin, and cryptomining, to be recognized by regulators” in China, Zhang said.

($1 = 6.3820 Chinese yuan renminbi)

 

(Reporting by Samuel Shen and Alun John; Editing by Shri Navaratnam)

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