Germany’s struggling Deutsche Bank is slashing thousands of jobs as it reshapes its stocks trading operation and refocuses its global investment banking business on its European base.

The bank said Thursday it would cut its workforce from 97,000 to “well below” 90,000 and that the reductions were underway.

It said headcount in the stocks trading business, mostly based in New York and London, would be reduced by about 25 percent. Those cuts will cost the bank about 800 million euros ($935 million) this year.

Deutsche Bank has struggled with high costs and troubles with regulators. The bank replaced its CEO in April after three years of annual losses and lagging progress in streamlining its operations.

New CEO Christian Sewing has said the bank would refocus on its European and German customer base and cut back on costlier and riskier operations where it doesn’t hold a leading position. Sewing said the bank was committed to its international investment banking operations but must “concentrate on what we truly do well.” The new strategy means stepping back from several decades of global expansion in which the bank sought to compete with Wall Street rivals such as Goldman Sachs or JPMorgan Chase.

Sewing replaced John Cryan in April with a mandate to accelerate the bank’s wrenching restructuring. It has suffered billions in losses from fines and penalties related to past misconduct. But progress in cutting costs has remained elusive. Sewing on Thursday affirmed the bank’s goal to hold costs to 23 billion euros this year and 22 billion next year.

The announcement came hours before Board Chairman Paul Achleitner had to face disgruntled investors at the bank’s annual shareholder meeting. The bank’s share price has sagged and it paid only a small dividend of 11 euro cents per share last year.

Addressing an audience of several thousands in Frankfurt, Achleitner said Cryan had “set the ball rolling for fundamental change” but later displayed “shortcomings in decision-making and implementation.”

“Dear shareholders, you are right to expect the bank and its management to hit the targets it has set itself,” he said. “If there are signs those targets are in jeopardy… then we on the supervisory board have to act swiftly and decisively.”

The bank’s troubles and the turmoil surrounding Cryan’s departure have put pressure on Achleitner as well. Cryan was forced to publicly push back against a media report that Achleitner was looking for a replacement, then left to twist in the wind for days before being shown the door. Achleitner brought Cryan to the bank in 2015 and thus in principle shares responsibility for the bank’s strategy and performance since then.
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Amazon, Starbucks, Vulcan and other companies have pledged a total of more than $350,000 toward an effort to repeal Seattle’s newly passed tax on large employers intended to combat homelessness.

Just days after the Seattle City Council approved the levy, the No Tax On Jobs campaign, a coalition of businesses, announced it would gather signatures to put a referendum on the November ballot to repeal it. 

Amazon, Starbucks, Vulcan, Kroger and Albertsons each promised $25,000 to the effort last week, according to a report filed by the campaign. The Washington Food Industry Association pledged $30,000. 

Referendum backers will have to gather 17,632 signatures of registered Seattle voters by June 14 to get the measure on the ballot.

The so-called head tax will charge businesses making at least $20 million in gross revenues about $275 per full-time worker each year. The tax would begin in 2019 and raise about $48 million a year to build affordable housing and provide emergency homeless services.

Opponents say the Seattle measure is a tax on jobs and questioned whether city officials are spending current resources effectively. 

Worker and church groups and others praised the tax as a step toward building badly needed affordable housing in an affluent city where the income gap continues to widen and lower-income workers are being priced out.

The clash over who should pay to solve the city housing crisis that’s exacerbated by Seattle’s rapid economic growth featured weeks of tense exchanges, raucous meetings and a threat by Amazon, the city’s largest employer, to stop construction planning on a 17-story building near its hometown headquarters.

Amazon has resumed planning the downtown building, but the company remains “apprehensive about the future created by the council’s hostile approach and rhetoric toward larger businesses, which forces us to question our growth here,” said Drew Herdener, Amazon’s vice president for global corporate and operations communications. 

Four council members initially pitched an annual tax of $500 per full-time employee before a compromise proposal lowered the tax rate after they could not muster six votes needed to override a potential veto by Mayor Jenny Durkan. 

The mayor signed the head tax on May 16, saying “we must make urgent progress on our affordability and homelessness crisis.”

Seattle’s action came as cities around San Francisco consider business taxes to help offset issues created by the growth of tech companies. 
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Starbucks Corp. on Wednesday revealed details of the employee anti-bias training program that will take place behind closed doors at 8,000 U.S. company-owned cafes on the afternoon of May 29.

Starbucks announced plans to shutter stores and corporate offices to train 175,000 employees after the controversial April 12 arrests of two black men, who were detained for hours after the manager of a Philadelphia Starbucks called police because they had not made purchases and refused to leave.

The arrests of Donte Robinson and Rashon Nelson, who were waiting to meet a friend, sparked protests and calls for a boycott of the coffee chain known for its diverse workforce and liberal stances on issues such as gay marriage.

Starbucks said the first training on May 29 “will serve as a step in a long-term journey to make Starbucks even more welcoming and safe for all.”

It will include videos featuring Starbucks executives such as Chief Executive Kevin Johnson, Executive Chairman and co-founder Howard Schultz, board member Mellody Hobson, hip hop artist Common, store managers and experts from the Perception Institute. Employees also will view a film called “You’re Welcome” by Stanley Nelson and participate in discussion and problem-solving sessions on identifying and avoiding bias in every day situations.

Starbucks said the long-term program is being designed and developed with input from researchers, social scientists, employees and other advisers.

Those partners include consultancy SY Partners — which worked with Starbucks to reinvent itself after a business crisis spawned by the “Great Recession”; the Perception Institute; Sherrilyn Ifill, president of the NAACP Legal Defense Fund; Bryan Stevenson, executive director of the Equal Justice Initiative; and Heather McGhee, president of public policy group Demos.

Since the Philadelphia incident, Starbucks has said it will allow people to sit in its cafes and use its restrooms without making a purchase. It also said it has outlined procedures for dealing with customers who are disruptive, using tobacco, drugs or alcohol or sleeping in its cafes. 
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U.S. President Donald Trump said on Wednesday “a different structure” is needed in trade negotiations with China, but he did not provide further details on the kind of change he seeks.

“Our trade deal with China is moving along nicely,” Trump said in his Twitter post Wednesday morning, “but in the end we will probably have to use a different structure in that this will be too hard to get done and to verify results after completion.”

The stock market reacted negatively after Trump cast doubt on trade negotiations with China but ultimately trimmed its losses, ending the day in the positive territory and gained 52.40 points, or 0.21 percent.  

Trump said on Tuesday he was neither pleased nor satisfied with how the recent trade talks with China went, but added, “They’re a start.” 

After two days of trade talks between the two countries in Washington last week, China agreed to “substantially reduce” the $375 billion annual trade surplus it has over the U.S. by buying more American goods, but there was no mention of any specific import and export targets in the statement agreed to by the two countries.

On Capitol Hill, concerns appear to be mounting on Trump’s approach to trade talks with China. 

Republican Senator John Cornyn of Texas cautioned Wednesday that the United States needs to remain “steely-eyed” and make sure “China isn’t playing us for fools.” 

Democratic Senator Debbie Stabenow of Michigan warned, “It’s important we not only talk tough about China, but actually be tough with China.”

“I am really concerned about the president’s hemming and hawing over the last few days when it comes to China. I’m worried that President Xi [Jinping] is crafting a much better deal than President Trump,” Senate Minority Leader Chuck Schumer of New York said Tuesday.  

On trade with China, Schumer added that he is “closer to the president’s view” than he was to the views of former Presidents Barack Obama or George W. Bush.  

Republican Senator Marco Rubio of Florida, chairman of the Congressional-Executive Commission on China and a longtime critic of China, said Wednesday that the U.S. needs a “structural rebalance” of trade with China, not a “dollar rebalance.” 

In a Twitter post, Rubio said he has urged Trump to “follow his initial instincts on China,” and he also asked Trump to “listen to those who understand that a short-term trade deal that sounds good but poses long-term danger is a bad deal.”  

According to U.S. media reports, infighting between free-trade advocates and protectionists within Trump’s trade team has led to contradicting policy pronouncements and public statements on trade negotiations with China.

For example, U.S. Treasury Secretary Steven Mnuchin said the United States would hold off on imposing tariffs on China. But U.S. Trade Representative Robert Lighthizer said hours later the tariffs were still on the table. Earlier this month, White House trade adviser Peter Navarro, known for his protectionist views, reportedly feuded with Mnuchin on his approach to trade talks during their trip to Beijing.

The recent rounds of trade talks are aimed at avoiding a full-blown trade war between the United States and China.

In April, Trump imposed tariffs on $50 billion worth of Chinese goods, and the Chinese retaliated with tariffs of their own. Trump announced he had instructed the U.S. trade representative to consider whether tariffs on another $100 billion worth of Chinese goods would be appropriate following China’s announcement.

Michael Bowman contributed to this report.
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Households are feeling more stable, small businesses are making money and many expect to expand and hire in the coming year, signs of continued optimism in two key parts of the economy, the Federal Reserve reported Tuesday in a pair of annual surveys.

Among more than 8,000 small businesses and more than 12,000 households covered in separate surveys late last year by the Fed and its 12 regional banks, the message was similar: economic conditions have been getting better and the expectation is for the good times to continue.

“We see a decided uptick” in the economic and credit conditions faced by small businesses, said one Fed official involved in the small business survey. “We are seeing improved business confidence and improved business performance,” with profitability and access to finance increasing in 2017, more than 70 percent of firms expecting revenue growth next year, and 48 percent expecting to add employees.

Among households, 74 percent of U.S. adults said they were financially comfortable or at least okay in 2017, four percentage points higher than in 2016 and 10 percentage points higher than the first survey year of 2013. Improvement was strongest in lower income households. The percentage of households that reported they were struggling financially fell to 7 percent from 9 percent last year.

The results from the surveys show that improvements in household and business conditions that took root under President Obama continued through the first year of the Trump administration.

Both findings are potentially significant for the economy’s future performance. Businesses with fewer than 500 employees generate perhaps 60 percent of new jobs, the New York Fed estimated in material released with the small business survey, and many report plans to expand in 2018.

Consumer spending, meanwhile, accounts for the bulk of U.S. gross domestic product, and strong household income growth in recent years has buoyed the economy overall.

“The mass of the consumer sector is in pretty good shape and that should continue,” Nathan Sheets, chief economist at PGIM Fixed Income said in an interview.

However, based on answers to a series of questions, about 2-in-5 adults faced what the Fed judged to be a “high likelihood of material hardship,” such as an inability to afford sufficient food, medical treatment, housing or utilities. About 4 in 10 said they could not meet an unexpected expense of $400 without carrying a credit card balance or borrowing from a friend.

Among the smallest firms, those with less than $100,000 in revenue, about 74 percent had trouble paying their bills, and a majority of those were either averse to borrowing or worried they would be turned down and so did not apply for credit.

But in overall the results for positive, said Fed officials.

Among firms that did apply for loans, for example, 46 percent received all they requested, compared to 40 percent last year. Nearly 60 percent wanted to use the money to expand. 
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The Trump administration is preparing to publish on Thursday long-delayed proposed rule changes for the export of U.S. firearms, a State Department official said on Tuesday.

The rule changes would move the oversight of commercial firearm exports from the U.S. Department of State to the Department of Commerce.

The action is part of a broader Trump administration overhaul of weapons export policy that was announced in April.

Domestic gun sales drop

Timing for the formal publication of the rule change and the opening of the public comment period was unveiled by Mike Miller the acting secretary for the Directorate of Defense Trade Controls, the State Department’s body that currently oversees the bulk of commercial firearms transfers and other foreign military sales.

He was speaking at the Forum on the Arms Trade’s annual conference at the Stimson Center, a Washington think tank.

Reuters first reported on the proposed rule changes in September as the Trump administration was preparing to make it easier for American gun makers to sell small arms, including assault rifles and ammunition, to foreign buyers.

Domestic gun sales have fallen significantly after soaring under President Barack Obama, when gun enthusiasts stockpiled weapons and ammunition out of fear that the government would tighten gun laws.

A move by the Trump administration to make it simpler to sell small arms abroad may generate business for gun makers American Outdoor Brands and Sturm, Ruger & Company in an industry experiencing a deep sales slump since the election of President Donald Trump.

Remington recovers from bankruptcy

Remington, America’s oldest gun maker, filed for bankruptcy protection in March, weeks after a shooting at a high school in Parkland, Florida, killed 17 people and triggered intensified campaigns for gun control by activists. Remington emerged from bankruptcy last week.

The expected relaxing of rules could increase foreign gun sales by as much as 20 percent, the National Sports Shooting Foundation has estimated. As well as the industry’s big players, it may also help small gunsmiths and specialists who are currently required to pay an annual federal fee to export relatively minor amounts of products.
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U.S. President Donald Trump said Tuesday “there is no deal” yet to lift the seven-year ban on the sale of American-made components to the giant Chinese telecommunications company ZTE, but that there might be a settlement as part of ongoing trade talks between the world’s two biggest economies.

Trump told reporters at the White House that he could envision a $1.3 billion fine against ZTE for violating the U.S. ban on trading with Iran and North Korea, the replacement of ZTE’s management and board of directors and imposition of “very, very strict security” to prevent the theft of U.S. intellectual and national security secrets.

“We caught them doing bad things,” he said.

Trump said Chinese President Xi Jinping asked him to look into the fate of ZTE after the firm said it had to shut its production because the U.S. banned sale of American-made components ZTE uses to manufacture an array of technology products until 2025. Trump said he also heard protests from the U.S. companies selling goods to ZTE.

Trump declared he was “not satisfied” with the state of U.S.-China trade talks after last week’s negotiations in Washington. China agreed to “substantially reduce” the $375 billion annual trade surplus it has over the U.S. by buying more American goods, but there was no mention of any specific import and export targets in the statement agreed to by the two countries.

U.S. Commerce Secretary Wilbur Ross is headed to China next week for further trade talks.

Trump commented on the ZTE case as U.S. news accounts quoted officials as saying a deal was near.

His suggestion of a $1.3 billion fine was slightly more than the $1.2 billion penalty the U.S. imposed last year on ZTE after uncovering its trade ban violations.

On Sunday, White House economic adviser Larry Kudlow said, “Do not expect ZTE to get off scot-free. Ain’t going to happen.”

Congressional opposition

But some U.S. lawmakers voiced opposition to settling the case.

U.S. Sen. Marco Rubio, who lost the 2016 Republican presidential nomination to Trump, contended that Washington had “surrendered” to Beijing. The Florida lawmaker said he would try to block it.

“Making changes to their board and a fine won’t stop them from spying and stealing from us. But this is too important to be over. We will begin working on veto-proof congressional action,” Rubio said on Twitter.

Senate Democratic Leader Charles Schumer said, “The proposed solution is like a wet noodle,” contending ZTE’s technology devices threaten to steal U.S. national security secrets.

Rescuing ZTE

Trump last week called for rescuing ZTE “to get back into business, fast.” He said “too many jobs in China” were being lost after the U.S. banned the sales of American-made components to ZTE. The U.S. leader said, “Commerce Department has been instructed to get it done!”

While some U.S. officials said the penalties against ZTE — the fine and the ban on sale of U.S. components until 2025 — were a law enforcement action, Trump linked the issue to ongoing trade and tariff disputes with China. The two countries over the weekend called off the threat of imposing higher tariffs on billions of dollars of each other’s exports while their negotiations continue.

Meanwhile, China announced Tuesday that on July 1 it will cut tariffs on most imported cars from 25 percent to 15 percent, still well above the 2.5 percent levy the U.S. imposes on cars imported from overseas.

The announcement by China’s finance ministry follows a pledge by Xi last month to lower the import duties and to ease foreign ownership restrictions for the Chinese auto industry.

Trump repeatedly has mentioned the 25 percent automobile tariff as a key trade barrier between the two countries.

On Monday, Trump said new trade between China and the U.S. will especially benefit U.S. farmers.

“Under our potential deal with China, they will purchase from our Great American Farmers practically as much as our Farmers can produce,” he said on Twitter.
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Glancing constantly at his rear view mirror, truck driver “El Flaco” journeys the highways of Mexico haunted by the memory of when he was kidnapped with his security detail by bandits disguised as police officers two years ago.

Back then, El Flaco, who spoke on condition of anonymity for fear of reprisals, was beaten, blindfolded and taken to a house near Mexico City where his captors threatened to kill him. Three days later he managed to escape and flee.

Today he travels with a machete and a satellite tracking device in his cab that can pinpoint him in emergencies.

Truckers covering Mexico’s vast territory often move in convoys to reduce the risk of robberies, which in 2017 almost doubled to nearly 3,000. Some drive with armed escorts traveling alongside them. Others remove the logos from their trucks.

Companies like brewer Grupo Modelo, a unit of AB InBev, and the Mexican subsidiary of South Korea’s LG Electronics have stepped up efforts to protect their drivers, deploying sophisticated geo-location technology and increasing communication with authorities.

The problem is part of a wider Latin American scourge of highway robbery that acts as a further drag on a region long held back by sub-par infrastructure.

“Roads are getting more and more dangerous, you try not to stop,” the 50-year-old El Flaco said, as he drove in the central state of Puebla, the epicenter of highway freight theft.

“Since I was kidnapped, I’ve gotten into the habit of looking in the mirror, checking car number plates, looking at who’s gone past me,” he added. “I look at everything.”

On the most dangerous roads, like those connecting Mexico City with major ports on the Gulf of Mexico and the Pacific, it is almost certain that one in every two truckers will be held up, a study by U.S.-based security firm Sensitech showed.

While no official data on losses exist, insurers paid out almost $100 million in 2016 to crime-hit cargo operators, up 4.5 percent on 2015, Mexican insurance association AMIS says.

The true sum is likely far higher: only one in three loads is insured due to the cost, according to industry estimates.

More than 80 percent of goods are transported by road and rail in Mexico, and the thefts are hurting competitiveness at a time the country is seeking to diversify trade and tap new sources of business.

Fuels, food and beverages, building materials, chemicals, electronic goods, auto parts and clothing are all top targets, Sensitech said.

Competition squeeze

Upon taking office in December 2012, President Enrique Pena Nieto promised to get a grip on gang violence and lawlessness.

But after some initial progress, the situation deteriorated and murders hit their highest level on record last year.

Highway robberies of trucks fell through 2014. But they almost doubled in 2015 to 985, hit 1,587 in 2016 and reached 2,944 last year.

The government has responded by stepping up police patrols in affected areas and lengthening prison sentences for freight robbery to 15 years. But robberies are still rising and most are not even reported due to the arduous bureaucratic process involved, Sensitech says.

“It’s hurting productivity and competitiveness,” said Leonardo Gomez, who heads a transportation national industry body.

Some drivers are armoring cabs in trucks made by companies like U.S. firm Kenworth, an expensive move that still only covers a tiny fraction of the almost 11 million trucks crisscrossing Latin America’s second-largest economy.

Last year, 53 trucks were armored against high-caliber weapons, up 40 percent from 2016, according to the Mexican Association of Automotive Armorers.

Attacks are not confined to roads. Some 1,752 robberies were recorded on railways last year, official data show. Criminals have also become more sophisticated.

They are turning to high-caliber weapons and employ devices to block Global Positioning Systems (GPS) to prevent trucks communicating their whereabouts, experts say.

Previously, companies that suffered robberies were generally able to recover their vehicles. Not any more.

“It’s not just the goods they want, it’s the trucks too,” said Carlos Jimenez of Mexican insurance association AMIS.
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