A federal program that anchorsa major part of Georgia’s farm economy is currently under fireas the United States prepares its future farm policy to complywith freer trade in the world.Since the 1930s, the U.S. government has run a peanut programthat controls domestic supply and demand through a quota and pricesupport system.In the past, this program had little effect on world trade, andworld trade had little effect on it, said Nathan Smith, an economistwith the University of Georgia Extension Service.Going to Change The World Trade Organization believes government subsidies distortfree world trade, Smith said.WTO considers a domestic program a “trade distorter”if it supports the number of acres of a commodity planted or theamount or price of the crop.Even though the current peanut program is considered a no-net-costprogram, the WTO says it’s a barrier against open world trade.The peanut program costs the United States in trade negotiations.”The WTO says the current program distorts world trade by$347 million,” Smith said.Under WTO rules, the United States has agreed to limit its spendingon agricultural trade-distorting programs to $19.1 billion. Thisis referred to as “amber box” spending, which includesthe current peanut program, Smith said.In WTO terminology, different types of spending go into different color boxes. Spending that distorts trade goes into the amber box. Spending that does not distort trade goes into a green box.Peanut Proposals The U.S. peanut industry is considering two major proposals.One proposes to stimulate the purchase of U.S. peanuts in theworld market. Peanuts would receive a price support similar tothe current program, Smith said. Processors would buy U.S. peanutsat the world price, and the government would make up the differencebetween the domestic price and the world price.”This program would modify the current program but not moveit out of the amber box,” Smith said.A second program would be a marketing loan option. Other majorU.S. crops such as corn and cotton are under this type of program.The government would still make payments to compensate for worldprices. But the program would not be tied to production controland would fit under WTO trade rules, Smith said.Whatever the outcome, he said, Georgia peanut farmers can expectchanges in the federal program that has governed their industryfor a long time. “But the peanut program doesn’t fit with the current (U.S.)trade policies,” Smith said. “The program is going tochange. But by how much? That’s the question right now.”Any changes to the current peanut program will affect Georgia’seconomy, Smith said. Peanuts contribute about $400 million a yearto Georgia’s farm economy and about $800 million in economic activityfor the state. Georgia grows about 40 percent of U.S. peanuts.It will be another year and half before the next farm bill isimplemented. But the House Agricultural Committee is now preparingthe part that will affect the peanut program, Smith said. Theyhope to have the basis ironed out by June.How will a domestic peanut program fit into a farm bill that encouragesmore open world trade?Competing with The World Unchecked free trade would hurt the domestic peanut industry,Smith said. High tariffs keep the U.S. peanut market from beingflooded by foreign peanuts. But these tariffs will be loweredin the future and allow more peanuts to be imported.The Free Trade Areas of America recently met in Canada to discussfurther expansion of free trade for all of the Western Hemisphere.This agreement includes open trade with peanut-producing countriessuch as Argentina and Nicaragua.Farmers in these countries have much lower input costs than U.S.growers have. They can sell their peanuts cheap. “And thosecountries would have access to our market,” Smith said. Peanutfarming in Georgia would be cut drastically.Trade Distorter
JPMorgan Chase beefed up its reserves with another $8.9 billion, more than the backstop in the first quarter, and now expects a more “protracted” economic recovery, Chief Financial Officer Jennifer Piepszak said.JPMorgan Chief Executive Jamie Dimon said the bank was “prepared for all eventualities as our fortress balance sheet allows us to remain a port in the storm.”Meanwhile, Citigroup added $5.6 billion in reserves also due to “deterioration” of the outlook, as well as downgrades in loan quality due to the virus, the bank said in a statement.And Wells Fargo put another $8.4 billion in reserves in the second quarter, pointing to the “unprecedented” nature of the pandemic.The reserve increases led to steep drops in profits at JPMorgan and Citigroup, although the banks benefitted from improvements in some divisions, such as trading.However, Wells Fargo reported a loss of $2.4 billion, compared with $6.2 billion in profits in the year-ago period. The bank, which unlike the others does not have major trading division, said it was cutting its dividend to 10 cents a share from 51 cents.Wells Fargo Chief Executive Charlie Scharf said the bank is “extremely disappointed” in the decision, but “our view of the length and severity of the economic downturn has deteriorated considerably from the assumptions used last quarter.”Trading is bright spotAt JPMorgan, net income fell 51 percent to $4.7 billion, translating into earnings-per-share that topped analyst forecasts. Revenues jumped 15 percent to $33.8 billion, its highest ever for a quarter.While the bank reported a loss in consumer and commercial banking, it garnered a big profit increase in its corporate and investment bank division, while trading revenues soared amid volatility in financial markets.Conditions in May and June were eased by a flood of government funding, but while the bank expects more stimulus will be forthcoming, that is not certain, Piepszak said in a conference call with reporters. And the bank expects double-digit US unemployment to persist through the middle of 2021. At Citigroup, net income fell 73 percent to $1.3 billion, while revenues rose five percent to $19.8 billion, boosted by higher revenues in its institutional clients group that offset a decline in consumer banking.Wells Fargo said its exposure included loans tied to problem industries such as oil and gas, real estate and entertainment recreation. Shares of JPMorgan rose 0.36 percent to $98.21, while Citigroup fell 3.9 percent to $50.15 and Wells Fargo slumped 4.6 percent to $24.25.Topics : The three banks suffered a collective hit of $5 billion from bad loans in the latest quarter, and while executives said they hoped that would mark the deepest hit from credit issues, they acknowledged that the health of the loans depends on the evolution of COVID-19.The virus cases and death toll have worsened in the US since the end of the quarter on June 30, leading officials in California, Texas and other states to revive restrictions after reopening their economies.”The pandemic has a grip on the economy and it doesn’t seem likely to loosen until vaccines are widely available,” said Citigroup Chief Executive Michael Corbat.Corbat said consumer spending in states with bad COVID-19 trends had declined somewhat in recent weeks, but not as much as in the “darkest days” earlier in the spring. Three major United States banks have set aside an additional US$23 billion as a backstop against bad loans, highlighting the brittle state of the US economy due to the coronavirus pandemic, the companies said Tuesday.Even amid gradual signs of a rebound as businesses reopen, the measures to contain COVID-19 have caused a devastating hit and millions of lost jobs in the world’s largest economy. That has raised fears companies will find it hard to pay their debts and households will not be able to pay their home mortgages, car loans and credit cards.
HOUSTON >> The Clippers entered their game against the Houston Rockets without star point guard Chris Paul and by halftime they were down another point guard and coach Doc Rivers. James Harden had a triple-double with 30 points, 13 rebounds and 10 assists and the Rockets rolled to a 140-116 victory Friday night.Clippers guard Austin Rivers and father/coach Doc Rivers were both ejected in the second quarter as Los Angeles dropped its fifth straight. “(The Rockets) played great and it’s a shame that how beautiful they played will be marred by this crap,” Doc Rivers said. “Because they played great and we didn’t play well.” Austin Rivers said the contact with the official was an accident.“I would never put my hands on a ref. I have never done anything like that in my career and it was frustrating to me because he happened to be right behind me,” Austin Rivers said. “He knows I didn’t touch him like that … he was in the wrong place at the wrong time and unfortunately it cost me the game … and it was a big deal for our team me going down.” During a timeout a few seconds later, Doc Rivers walked toward where all three referees were standing and began yelling at them. He was then ejected by crew chief Jason Phillips. The Rockets led 59-35 when the elder Rivers was ejected. Phillips said that Rivers was ejected for using “extreme profanity” while complaining about his son being ejected. But Doc Rivers said that wasn’t the case and that he called the timeout because they saw an official call a foul on a layup Marreese Speights made on the play before the timeout, but didn’t give them the free throw.“I said: ‘No you forgot to give us the free throw,”’ Doc Rivers said. “I said: ‘Come on you guys don’t know what you’re doing.’ That was it.” It was the second time the pair has been tossed in the same game after they were both ejected late in a loss to the Washington Wizards on Dec. 18. The coach has been ejected three times this season and it’s the fourth career ejection for his son. The Clippers’ J.J Redick returned after missing two games with a sore left hamstring. He had eight points. … DeAndre Jordan had 20 points and 13 rebounds. Paul missed three games with the problem before returning Wednesday night against New Orleans. He played 31 minutes in the loss and Doc Rivers said Paul experienced some fatigue after that game. It’s unclear how long Paul will sit out. It’s the seventh triple-double this season for Harden and his third straight 30-point game. Montrezl Harrell added a career-high 29 points to help Houston win its third in a row. Raymond Felton had a season-high 26 points to lead the Clippers.The Rockets had allowed what was once a 25-point lead to dwindle to six points early in the fourth quarter before scoring the next 13 points to make it 126-104 with just under seven minutes remaining. Harrell made six points to power that run and the Clippers went more than four minutes without scoring. The Rockets had an 18-point lead later in the quarter when Harden hit Harrell with a bounce pass and he made the layup before crashing to the court to give Harden his 10th assist. The younger Rivers was tossed after missing a layup and slightly pushing referee J.T. Orr with 6:38 left in the second quarter. He yelled at Orr and waved his arms at him after the ejection and was led off the court by a Clippers employee. When he got to the edge of the court, he tried going back toward the referee and had to be held back by the employee and pulled off the court. Newsroom GuidelinesNews TipsContact UsReport an Error