House GOP Budget Plan Includes 2018 Farm Bill Extension, Funding for ‘Orphan’ Programs

Scott suspends presidential campaign | China buys more U.S. soybeans | Japanese yen at 1-year low

Jim Wiesemeyer

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November 13, 2023 08:57 AM

Scott suspends presidential campaign | China buys more U.S. soybeans | Japanese yen at 1-year low

Today’s Digital Newspaper

MARKET FOCUS

This week significant period for retail sector
Over 90% of S&P 500 companies have disclosed third-quarter results
Morgan Stanley and Goldman Sachs differ on Fed rate cut predictions
ECB Vice President Luis de Guindos warned that inflation may pick up temporarily
Geopolitical risks at highest level in 50 years: CEO of Baker Hughes
Key U.S. economic reports this week
Foreclosures surge in complex commercial real estate finance
Japanese yen weakens, reaching one-year low
Hack on ICBC disrupts $62 billion U.S. Treasury repo market
WTI crude oil futures dropped below $77 per barrel
Fertilizer stockpiles needs replenished next year: Mosaic
Copper price slump challenges renewable energy transition
Employees at Ford and General Motors reject proposed labor contracts
Ag markets today
USDA daily export sales:
— 204,000 MT soybeans to China during 2023-2024 marketing year
— 143,637 MT corn to Mexico during 2023-2024 marketing year
India imports record amounts of palm oil, sunoil
Ag trade update
NWS weather outlook
Pro Farmer First Thing Today items

CONGRESS

House spending bill would set January, February deadlines
House bill includes 2018 Farm Bill extension, funding for ‘orphan’ programs
Rep. Gabe Amo to be sworn in today
Congress plans oversight hearings on financial regulators, antitrust, and GSA

ISRAEL/HAMAS CONFLICT

Healthcare crisis in Gaza is worsening

CHINA

U.S. gov’t suspects Chinese firms aiding Russian military equipment transfer
China’s return to deflation posing significant challenge for exporters
Xi’s confab with Biden helping spur purchases of U.S. soybeans
China’s new bank loans fall sharply in October

ENERGY & CLIMATE CHANGE

Electricity consumption in Texas is experiencing significant growth at historic rates

LIVESTOCK, NUTRITION & FOOD INDUSTRY

China’s changing consumer preferences leading to big shift in agriculture worldwide
Iowa reports four additional cases of highly pathogenic avian influenza (HPAI
USDA confirms two more cases of HPAI in South Dakota
USDA’s Paraguayan beef decision raises FMD concerns for NCBA, limited impact

HEALTH UPDATE

Study shows Novo Nordisk’s Wegovy has heart health benefits

POLITICS & ELECTIONS

Sen. Tim Scott (R-S.C.) suspends presidential campaign
Argentine presidential debate heats up ahead of Nov. 19 runoff
Former U.K. Prime Minister David Cameron has surprising return to politics
Former President Donald Trump has made several notable gaffes in recent months
Trump advisers: Mass deportations planned if re-elected

OTHER ITEMS OF NOTE

U.S. sees strong rebound in international student enrollment post-pandemic
Strip clubs, lewd photos and a boozy hotel

MARKET FOCUS

— Equities today: Asian and European markets were mixed in overnight trading. U.S. Dow opened around 50 points lower. European stocks rose. Health firms were among the strongest performers, with Novo Nordisk rallying almost 4% after a study backed the use of Wegovy, its blockbuster weight-loss drug, to cut heart attacks and deaths in obesity patients. In Asia, Japan flat. Hong Kong +1.6%. China +0.3%. India -0.5%. In Europe, at midday, London -0.7%. Paris -0.6%. Frankfurt +0.4%.

U.S. equities for the week and Friday: All three major indices registered gains for the day which propelled them further into positive territory for the week which saw the Dow rise 0.7%, the Nasdaq gained 2.4% and the S&P 500 moved up 1.3%. On Friday, the Dow gained 391.16 points, 1.15%, at 34,283.10. The Nasdaq rose 276.66 points, 2.05%, at 13,798.11. The S&P 500 was up 67.89 points, 1.56%, at 4,415.24.

— This week marks a significant period for the retail sector as several major U.S. retailers are set to release their third-quarter earnings reports. These reports will provide valuable insights into consumer spending trends and the overall health of the economy. Key industry players such as Walmart, Target, and Home Depot will also offer their perspectives on their performance as they enter the crucial holiday quarter.

Of note: Over 90% of S&P 500 companies have already disclosed their third-quarter results. Earnings have shown a year-over-year increase of 6.3%, as reported by LSEG (formerly Refinitiv), while revenue growth has been more modest at 1.4%. Below are the major earnings reports to watch for this week:

Tuesday: Home Depot (before the opening bell)

Wednesday: Target, TJX Companies (before the opening bell)

Thursday: Walmart, Macy’s (before the opening bell); Gap (after the closing bell)

— Agriculture markets Friday:

Corn: December corn futures fell 4 cents to $4.64, marking a 13 1/4 cent loss on the week.
Soy complex: November soybeans rose 4 cents to $13.47 1/2 but gave up 4 1/4 cents on the week. December meal fell 50 cents to $449.40 but rose $7.30 from a week-ago. December soyoil rose 75 points to 51.20 cents, which represented a 184-point week-over-week gain.
Wheat: December SRW wheat futures fell 5 1/2 cents to $5.75 1/4 and for the week rose 2 3/4 cents. December HRW wheat futures fell 7 1/4 cents to $6.40 today and for the week lost 3 1/2 cents. December spring wheat fell 4 cents to $7.30 1/2 but gained 9 1/2 cents on the week.
Cotton: December cotton rose 80 points to 77.32 cents but fell 230 points on the week.
Cattle: December live cattle futures fell 17 1/2 cents to $174.175 and hit a five-month low. For the week, December live cattle dropped $9.70. January feeder cattle futures rose $1.50 to $226.425 today and hit a seven-month low early on. On the week, January feeders lost $13.325.
Hogs: December lean hogs rallied 45 cents to $71.90, notching a 15-cent gain on the week.

— Ag markets today: Soybean futures firmed overnight while the wheat market weakened. Corn was caught in the middle amid light, two-sided trade. As of 7:30 a.m. ET, corn futures were trading fractionally to a penny lower, soybeans were mostly 4 cents higher and wheat futures were 2 to 5 cents lower. Front-month crude oil futures and the U.S. dollar index were both modestly firmer this morning.

Cattle searching for a low. Cattle futures plunged last week, causing cash cattle prices to crater. With both futures and the cash market reeling, traders will be looking for signs of a bottom. Seasonally, the next couple of weeks tend to be a struggle for the cattle market, though an uptick is usually seen after Thanksgiving as retailers buy beef for year-end features.

Cash hog index resumes downtrend. After three days of gains, the CME lean hog index is down 59 cents to $76.28 as of Nov. 9, resuming its seasonal decline. December lean hog futures finished Friday at a $4.38 discount to today’s cash quote. Over the past five years, the index averaged a $5.47 decline from now until mid-December, when the contract is cash settled.

— Quotes of note:

Morgan Stanley and Goldman Sachs differ on Fed rate cut predictions. Morgan Stanley anticipates that the Fed will implement significant rate cuts over the next two years. In contrast, Goldman Sachs envisions rate reductions beginning later, in the fourth quarter of 2024, with quarterly cuts continuing through mid-2026. Goldman Sachs CEO David Solomon has expressed a belief that the likelihood of a recession in the U.S. has significantly decreased.
What Bloomberg Economics says: “In our view, Fed officials will most likely retain a tightening bias until monthly core CPI is running at a consistent 0.2%-0.3% pace for at least six months. The low end of that range only happened for a summer, and core CPI has been creeping toward the upper end since, which is more consistent with an annual rate of 3% inflation than 2%.” — Anna Wong, Stuart Paul, Eliza Winger and Estelle Ou, economists.
ECB Vice President Luis de Guindos warned that inflation may pick up again temporarily, though its prevailing direction is downwards.
Geopolitical risks are at their highest level in 50 years, raising concerns about energy supplies and helping feed a boom in liquefied natural gas, Lorenzo Simonelli, chief executive officer of Baker Hughes, tells the Financial Times (link/paywall).
“We locals aren’t just doing well, we can even be considered rich.” — Pham Van Trung, a Vietnamese farmer who made $81,000 this year selling durian to China.

— Key U.S. economic reports ahead. The upcoming Consumer Price Index (CPI) report on Tuesday marks the beginning of a series of important economic indicators in the U.S., offering insight into the economy’s performance at the beginning of the fourth quarter. On Wednesday, retail sales data is expected to reveal a slowdown in consumer spending for October, following several months of strong growth. Subsequent reports later in the week are likely to indicate decreases in industrial production and housing starts, painting a comprehensive picture of the economic landscape for the start of the quarter.

— Several early economic indicators suggest that it might be a wise decision to delay holiday shopping this year. These signs point to a potentially weaker holiday season compared to the past three years, which could have significant consequences for retailers, economists, and shoppers alike. For retailers, a lackluster holiday season could be disastrous, while economists view it as a concerning signal about the overall economic trajectory. For shoppers, these indicators provide insight into when and to what extent stores might begin offering substantial discounts. In an article (link), the Wall Street Journal outlines five signs that point towards the possibility of significant price reductions this holiday season.

— Foreclosures are on the rise in a complex and risky segment of commercial real estate finance, signaling worsening turmoil in the property market. This surge in foreclosures primarily involves high-risk property loans called mezzanine loans, and the number of foreclosure notices issued for such loans has reached a record high this year. The mezzanine-loan market serves as an early indicator of distress in the commercial real estate sector. A Wall Street Journal article (link) examines the implications of this trend and explains why it serves as a clear signal of trouble in commercial real estate.

Market perspectives:

— Outside markets: The U.S. dollar index was firmer, with only the euro weaker against the greenback. The yield on the 10-year U.S. Treasury note was firmer, around 4.64%, with a mixed tone in global government bond yields. Crude oil futures edged, with U.S. crude around $77.30 per barrel and Brent around $81.60 per barrel. Gold and silver futures were mixed, with gold slightly firmer around $1,940 per troy ounce and silver weaker around $22.16 per troy ounce.

— Japanese yen has weakened, reaching a one-year low of around 152 per dollar, as investors anticipate U.S. inflation data and listen for comments from Federal Reserve officials this week. Last week, hawkish statements from U.S. policymakers had a negative impact on the markets. Fed Chair Jerome Powell expressed uncertainty about the central bank’s efforts to control inflation, which contrasted with the Bank of Japan’s commitment to maintaining accommodating monetary policies. BOJ Governor Kazuo Ueda acknowledged that policy divergence between the two central banks contributed to the yen’s weakness but refrained from making explicit statements in favor of the yen. Earlier this month, the BOJ redefined its stance on 10-year Japanese Government Bonds (JGBs), stating that 1% is now seen as a loose “upper bound” rather than a rigid cap. Additionally, the BOJ removed its pledge to defend this level with offers to buy an unlimited amount of bonds.

— Hack on ICBC disrupts $62 billion U.S. Treasury repo market. Last week’s hack against ICBC hit the repo market, where more than $62 billion of U.S. Treasurys failed to deliver Thursday, DTCC data shows, meaning either sellers didn’t send securities or buyers didn’t receive them in time to settle a trade. Link to more via the Wall Street Journal.

— WTI crude oil futures dropped below $77 per barrel on Monday, reversing some gains from the previous session. This decline is driven by concerns about slowing demand in the U.S. and China, both significant consumers of oil. The U.S. Energy Information Administration (EIA) reported a projected decline of 300,000 barrels per day in U.S. oil consumption for this year. Additionally, weak economic data in China has raised concerns about reduced energy demand. Chinese refiners have also requested less oil supply from Saudi Arabia for December. The easing of worries regarding the Israel/Hamas conflict disrupting oil supplies from the Middle East has further contributed to the decrease in crude oil prices. However, oil prices experienced a nearly 2% increase on Friday after Iraq expressed support for OPEC+ oil production cuts. The OPEC+ group, consisting of major oil producers, is set to meet on Nov. 26 to decide on production policies.

— Fertilizer supplier Mosaic Co. predicts that fertilizer stockpiles will need to be replenished next year, which will boost demand for the struggling crop nutrients industry. They anticipate a significant increase in global shipments of potash, a crucial crop nutrient, with an expected rise of 5 million metric tons, reaching a total of 70 million metric tons next year. This would mark the highest volume since at least 2021, prior to Russia’s invasion of Ukraine.

Mosaic notes that excess inventories in Brazil, a major agricultural player, have been fully depleted, setting the stage for stronger sales and profits into 2024. Mosaic reported that its shipments of potash and phosphate to meet the demand from North American farmers during the spring planting season were the highest in five years.

— Copper price slump challenges renewable energy transition. The prolonged decline in copper prices presents a significant challenge to the global shift towards renewable energy sources. Meeting the demand for copper required for the transition to renewables will necessitate large-scale mining operations over the coming years. However, the current slump in demand has led to low copper prices, which in turn discourage investment in the development of new copper supplies. This poses a dilemma for the renewable energy sector and highlights the need for balancing supply and demand dynamics in the copper market to support sustainable energy transitions.

— Employees at Ford and General Motors have rejected proposed labor contracts. Production workers at two Ford plants in Kentucky voted against the agreement negotiated by the UAW and the carmaker, following in the footsteps of union members at a GM plant in Flint, Michigan. These rejections raise concerns about the fate of these contracts, which were intended to bring an end to the UAW’s financially burdensome strike against the major Detroit automakers.

— USDA daily export sales:

204,000 MT soybeans to China during 2023-2024 marketing year
143,637 MT corn to Mexico during 2023-2024 marketing year

— India imports record amounts of palm oil, sunoil. India’s imports of palm oil and sunflower oil in 2022-23 surged 24% and 54%, respectively, to record highs on a rebound in consumption and as both oils were available at a steep discount compared to rival soyoil. Palm oil imports totaled 9.79 MMT in the 2022-23 marketing year that ended Oct. 31, while sunflower oil imports rose to 3 MMT, Mumbai-based Solvent Extractors’ Association of India (SEA) said. Soyoil imports in the year fell 12% to 3.68 MMT.

— Ag trade update: Iran tendered to buy up to 180,000 MT of corn to be sourced from Brazil, Europe or the Black Sea region and 120,000 MT of soymeal from Brazil, Argentina or India. Tunisia tendered to buy 50,000 MT of durum wheat from west European countries, the U.S., Canada or Argentina.

— NWS weather outlook: Cool temperatures and beneficial rains to cross over the drought-stricken Gulf Coast states... ...Some accumulating snow expected for the higher elevations of the Washington Cascades and Northern Rockies over the next few days... ...Mild air expected across much of the Intermountain West and stretching east across large areas of the Plains and Midwest.

Items in Pro Farmer’s First Thing Today include:

• Beans firmer, wheat lower and corn caught in the middle overnight
• AgRural cuts Brazilian soybean crop forecast
• More unfavorable weather in Brazil
• Japan’s wholesale inflation slows sharply in October

CONGRESS

— House spending bill would set January, February deadlines. The GOP-led House is moving forward with a stopgap bill (link) to prevent a government shutdown past the impending Nov. 17 deadline, but it has introduced a complex “laddered” continuing resolution with deadlines in January and February, drawing criticism from GOP appropriators. The bill sets a Jan. 19 deadline for four bills and a Feb. 2 deadline for eight others. While this staggered approach complicates the schedule, it avoids including conservative policy riders or additional spending cuts, which is seen as a win for appropriators but a disappointment for hardline Republicans.

The deadlines are:

Jan. 19: Agriculture-FDA, Energy and Water, Military Construction-VA, and Transportation-HUD
Feb. 2: Commerce-Justice-Science, Defense, Financial Services, Homeland Security, Interior-Environment, Labor-HHS-Education, Legislative Branch, State and Foreign Operations

The bills with a Jan. 19 deadline are typically bipartisan priorities, although some have faced challenges in the House. Notably, the Agriculture-FDA bill failed due to spending cuts and abortion riders, while the Transportation-HUD bill didn’t receive a vote due to conservative complaints about insufficient spending cuts. The Energy and Water and Military Construction-VA bills did pass in the House.

The Senate has passed a combined package of three of these bills but is also considering its own continuing resolution to fund the government through mid-January.

Some House GOP appropriators preferred a clean stopgap without multiple deadlines to buy more time, while others believe January would be a more realistic deadline. Passing the CR will likely require Democratic votes, as some Republicans have expressed unwillingness to support it. House Speaker Mike Johnson (R-La.) said on Sunday he “will not allow end-of-year megabus spending packages to continue under my leadership.”

Some Democrats have criticized the GOP’s approach as reckless and likely to lead to government shutdowns. However, Sen. Chris Murphy (D-Conn.) has expressed openness to the House’s plan, emphasizing the importance of keeping the government open.

Of note: The pending House CR measure, which will be taken up this afternoon by the Rules Committee and could see action as soon as Tuesday, includes a 2018 Farm Bill extension through September 2024, and provides funding for so-called farm bill orphan programs. Dairy subsidies would be extended through Dec. 31, 2024, to avert the looming “dairy cliff” on Jan. 1, when the government-guaranteed price of fresh milk would more than double, driving up prices.

— Rep. Gabe Amo to be sworn in today. Today, Rep. Gabe Amo, a Democrat from Rhode Island, is scheduled to be sworn in during the 6:30 p.m. ET votes, according to his campaign. Amo won the election on Nov. 7, succeeding former Rep. David Cicilline, who resigned in the spring. With Amo’s addition, the House of Representatives will consist of 221 Republicans and 213 Democrats. There is one remaining vacancy in Utah, which will be filled in a special election on November 21. Celeste Maloy, a Republican, is favored to replace her former boss, Chris Stewart, also a Republican.

— Congress plans oversight hearings on financial regulators, antitrust, and GSA. Both chambers of Congress have scheduled oversight hearings involving financial regulators, the Department of Justice’s Antitrust Division, and the General Services Administration (GSA). On Tuesday, the Senate Banking Committee will hear testimony from key figures, including Federal Reserve Vice Chair for Supervision Michael Barr, FDIC Chair Martin Gruenberg, acting Comptroller of the Currency Michael Hsu, and National Credit Union Administration Chair Todd Harper. The same day, a House Oversight hearing will feature testimony from General Services Administration chief Robin Carnahan. Concurrently, a Judiciary subcommittee will convene to discuss matters related to the Justice Department’s Antitrust Division. These hearings represent important avenues for congressional oversight and examination of various regulatory and administrative matters.

ISRAEL/HAMAS CONFLICT

— Healthcare crisis in Gaza is worsening, with thousands of hospital patients and staff seeking shelter from ongoing Israeli airstrikes. Reports from aid agencies and journalists indicate that Gaza’s largest hospital has seen its operating rooms rendered inoperative, and medical personnel are working under candlelight conditions. Israeli Prime Minister Benjamin Netanyahu, in an interview with CNN, expressed his willingness to assist civilians at the besieged Al-Shifa Hospital by establishing “safe corridors” for evacuation. However, he declined to accept responsibility for failing to prevent the Oct. 7 attack on Israel. Netanyahu emphasized the need to unite the country to achieve victory amid the ongoing conflict.

CHINA UPDATE

— U.S. gov’t suspects Chinese firms aiding Russian military equipment transfer. The U.S. government has evidence suggesting that Chinese companies may be assisting in the transfer of equipment to support Russia’s military efforts, despite Western sanctions, U.S. Treasury Secretary Janet Yellen said Friday. She expressed her concerns during meetings with Chinese Vice Premier He Lifeng, emphasizing that this equipment, which could aid Russia’s military, is evading sanctions and reaching Moscow, thereby supporting its war against Ukraine.

Yellen stressed the importance of companies refraining from providing material support to Russia’s defense industrial sector, and she warned that significant consequences would be imposed on those that do so. She emphasized the determination of the U.S. to prevent the flow of materials that assist Russia in conducting its war, indicating that companies found aiding Moscow’s war effort could face sanctions.

The U.S. government has already imposed sanctions on several private firms, including some in China, that were involved in helping Russia acquire equipment. Financial institutions that could be aiding these efforts have also faced sanctions. Yellen called for China to take action to address this issue, particularly when provided with information on such activities.

Of note: Yellen clarified that the Chinese firms involved in this matter are private entities, and she did not suggest that the Chinese government was aware of or complicit in these activities.

— China’s return to deflation is posing a significant challenge for exporters, leading to a dual impact of declining demand and diminishing price competitiveness, as noted by HSBC’s Frederic Neumann. This situation is particularly concerning for Southeast Asian exporters who have already grappled with reduced Chinese demand this year. Additionally, they now face intensified competition from cost-effective Chinese manufacturers. This double whammy is not limited to Southeast Asia; it affects exporters worldwide, including countries like Germany, Taiwan, and South Korea, as they contend with China’s changing economic conditions.

— Xi’s confab with Biden helping spur purchases of U.S. soybeans. China bought more than 3 million metric tons of soybeans from the U.S. last week, a volume that surprised the market. The move is a gesture of goodwill ahead of Biden-Xi talks scheduled to take place in San Francisco this Wednesday. China bought U.S. soybeans even though they are more expensive than Brazilian supplies, and processing margins are weak. The nation is purchasing more than it needs for domestic use, signaling it’s seeking to build stockpiles, said Alex Sanfeliu, head of world trading at Cargill, the world’s largest agricultural commodities trader. “Xi’s visit is the only logical explanation why Sinograin would pay a big premium over Brazil beans,” Ken Morrison, an independent commodity trader in St. Louis, told Bloomberg. “Sinograin has a dual role; they crush beans, and they manage reserve stocks for the government. Crushing is very competitive in China as it is everywhere. Crushers don’t pay above-market prices.”

— China’s new bank loans fall sharply in October. Chinese banks extended 738.4 billion yuan $101.30 billion) in new loans in October, the least in three months. Household loans, including mortgages, contracted by 34.6 billion yuan in October after rising 858.5 billion yuan in September. Corporate loans fell to 516.3 billion yuan from 1.68 trillion yuan in September. The amount of loans usually falls in October due to seasonal factors, but this year’s figures were above 615.2 billion yuan in 2022 and forecasts of 665 billion yuan. Meanwhile, outstanding yuan loans grew 10.9% year-on-year, the same as in September.

ENERGY & CLIMATE CHANGE

— Electricity consumption in Texas is experiencing significant growth at historic rates, serving as a preview of what may happen in many parts of the United States. Texas, the largest electricity producer and consumer in the country, has witnessed electricity sales increasing at a rate five times higher than the national average over the past decade. This growth is akin to adding the entire electricity consumption of a state like Louisiana. A Wall Street Journal article (link) says several factors contribute to this surge in electricity demand in Texas. The state’s large population necessitates substantial air conditioning usage. Additionally, Texas is at the forefront of trends that are driving increased electricity consumption in various regions of the U.S. These trends include the reshoring of manufacturing, the expansion of power-hungry data centers, and a concerted effort to shift toward electrification in various sectors. The situation in Texas reflects broader developments and challenges in the energy landscape, emphasizing the importance of managing electricity demand and ensuring reliable supply as these trends continue to shape the energy industry.

LIVESTOCK, NUTRITION & FOOD INDUSTRY

— China’s changing consumer preferences are leading to a significant shift in agriculture worldwide. Over the past few decades, as China’s wealth has increased, its appetite for foreign produce has grown substantially. The country now imports more than $200 billion worth of food annually, surpassing all other nations. This figure is a significant increase from around $15 billion two decades ago, as reported by the World Trade Organization. This shift in demand from China is prompting farmers around the world to adapt and capitalize on the changing landscape of global agriculture. An article in the Wall Street Journal (link) explores how farmers are adjusting to meet China’s evolving tastes and increasing demand for imported agricultural products.

— Iowa has reported four additional cases of highly pathogenic avian influenza (HPAI), with one case occurring in a commercial layer flock in Taylor County, and the other three cases affecting backyard flocks in Jones, Cerro Gordo, and a game bird flock in Kossuth County.

Meanwhile, USDA has confirmed two more cases of HPAI in South Dakota, both in commercial turkey operations — one with 58,400 birds in McPherson County and the other with 51,200 birds in Roberts County.

Bottom line: These cases raise concerns about the spread of avian influenza among poultry populations.

— USDA’s Paraguayan beef decision raises FMD concerns for NCBA, limited impact expected on U.S. imports. USDA’s decision to reopen the U.S. market to specific Paraguayan beef has raised concerns from the National Cattlemen’s Beef Association (NCBA) about the potential for Foot and Mouth Disease (FMD) to enter the United States. Despite the criticism, trade experts believe that there will be minimal effects on US beef imports from Paraguay because Paraguay must compete with other countries for a reduced tariff on their exports to the U.S.

HEALTH UPDATE

— Study shows Novo Nordisk’s Wegovy has heart health benefits. A highly anticipated study has revealed that Novo Nordisk’s Wegovy, a drug primarily used for weight loss, may offer additional benefits for heart health. In the study, which involved approximately 17,500 participants with obesity and heart disease (but not diabetes), weekly injections of Wegovy reduced the risk of heart attack, stroke, and death from cardiovascular causes by 20%. These promising findings could potentially lead to expanded insurance coverage for Wegovy and encourage more individuals to use the drug, providing new avenues for improving heart health.

The medicine isn’t without risks. Over 16% of trial participants suffered side effects like vomiting and diarrhea, forcing them to drop out. (Some doctors downplayed this outcome, saying such symptoms could be avoided or minimized by tweaking the prescribed medication.) It’s also not clear how Wegovy improves heart health, and whether it would show success outside the trial.

POLITICS & ELECTIONS

— Sen. Tim Scott (R-S.C.) decided to suspend his presidential campaign, which was a long-shot attempt to provide an alternative to the Republican front-runner, Donald Trump. Despite drawing interest from prominent Wall Street executives, Scott announced his decision on Fox News, emphasizing his love for the country but stating that he would not continue his campaign when returning to Iowa. He also mentioned that he would not immediately endorse any candidate or seek a vice-presidential nomination. He faced challenges in standing out from a crowded field of candidates, with polls showing him in sixth place among GOP contenders. Trump’s wide polling lead and the attention surrounding his legal battles have dominated the 2024 Republican race. Despite his early financial advantage, his fundraising eventually lagged behind other candidates, including Ron DeSantis and Nikki Haley.

— Argentine presidential debate heats up ahead of Nov. 19 runoff. In Argentina’s recent presidential debate, Economy Minister Sergio Massa aggressively challenged the policy proposals of libertarian candidate Javier Milei, forcing Milei into a defensive position. The upcoming runoff election is scheduled for Nov. 19.

— Former U.K. Prime Minister David Cameron has made a surprising return to politics by being appointed as the Foreign Secretary in a government reshuffle. Cameron, who resigned after the 2017 Brexit referendum, is no longer a Member of Parliament (MP), so he has been granted a peerage (Baron) to enable him to assume this role. The reshuffle began with the removal of Suella Braverman from the position of Home Secretary, while Jeremy Hunt continues to serve as Chancellor until the upcoming fiscal statement. This move represents a significant gamble by Prime Minister Rishi Sunak, as he aims to narrow a 20-point polling deficit against the opposition Labor Party in preparation for the expected general election in 2024.

— Former President Donald Trump has made several notable gaffes in recent months, including confusing President Joe Biden with former President Barack Obama on at least seven occasions. In one instance, while speaking in New Hampshire, Trump referred to a recent interview with Hungarian Prime Minister Viktor Orban and said, “what would you advise President Obama? The whole world seems to be exploding,” when he meant President Biden. This mix-up has been part of a series of misstatements by Trump, and his political opponents have seized on these gaffes. The DeSantis campaign and Biden-Harris HQ have shared videos and tweets highlighting these rhetorical blunders. Other instances of Trump’s misstatements include confusing former President George W. Bush and former Florida Gov. Jeb Bush, inaccurately stating that Hungary shares a border with Russia, and making an erroneous claim that North Korea has 1.4 billion people, when the actual population is around 26 million. These gaffes have drawn attention and criticism from various quarters.

— Trump advisers: Mass deportations planned if re-elected. Advisers to former President Donald Trump have revealed that if he wins the White House again, he intends to carry out large-scale deportations of undocumented workers apprehended in workplace raids, impacting significant industries like agriculture. Link for details via the New York Times.

OTHER ITEMS OF NOTE

— U.S. sees strong rebound in international student enrollment post-pandemic. The United States has seen a substantial rebound in the number of international students at its colleges and universities, nearly recovering from the decline caused by the Covid-19 pandemic. This recovery has been boosted by a surge in Indian students, compensating for a decrease in Chinese students. According to the Institute of International Education, the count of foreign students increased by 12% during the 2022-2023 academic year, reaching nearly 1.06 million students. Although Chinese students remain the largest foreign nationality on U.S. campuses, there is a growing trend among middle-income Chinese families to explore more affordable study destinations, such as the United Kingdom and Australia.

— Strip clubs, lewd photos and a boozy hotel. Read (link) the Wall Street Journal’s investigation into the toxic atmosphere at the FDIC, one of the nation’s top banking regulators.

KEY LINKS

Policy Updates