American Submarines Headed Down Under
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Quick Hits: Today’s Top Stories
- Credit Suisse announced this morning it will borrow up to 50 billion Swiss francs ($53.7 billion) from the Swiss National Bank in an effort to shore up liquidity after Credit Suisse’s stock price plunged to an all-time low on Wednesday. The U.S. Treasury Department has reportedly begun reviewing American banks’ exposure to Credit Suisse amid the turmoil, which was sparked in part by the collapse of Silicon Valley Bank and in part by Credit Suisse’s largest shareholder announcing it would not buy any more stock in the bank due to regulatory concerns.
- The Labor Department reported Wednesday the producer price index (PPI)—a measure of what suppliers and wholesalers are charging customers—rose 4.6 percent year-over-year in February, down from January’s 5.7 percent annual rate and the measure’s lowest reading since March 2021. Core PPI—which excludes food and energy prices—held steady at a 4.4 percent annual rate in February. The Commerce Department, meanwhile, reported Wednesday that retail sales—including spending on food and fuel—declined 0.4 percent month-over-month in February after climbing 3.2 percent in January.
- Secretary of State Antony Blinken announced Wednesday during a trip to Ethiopia the United States would provide the war-torn African nation with another $331 million in humanitarian assistance aimed at supporting “those displaced and affected by conflict, drought, and food insecurity.” Blinken urged Ethiopian leaders to follow through on the fragile peace agreement both sides of the civil war agreed to in November and called for “accountability” for the hundreds of thousands killed over the past few years.
- An Iranian police spokesman announced yesterday law enforcement had arrested 110 suspects in connection with the suspected poisoning of thousands of schoolgirls in the country in recent months. The official didn’t provide details about any of the suspects’ alleged motives or say whether police had determined what chemicals were used in the attacks, but claimed a number of cases were the result of “psychological factors” rather than poisoning.
- The Justice Department announced yesterday it had arrested Chinese billionaire Guo Wengui after unsealing a 12-count indictment that included several wire fraud, securities fraud, bank fraud, and money laundering charges. Guo—an associate of Steve Bannon—is alleged to have defrauded thousands of his online followers out of more than $1 billion, misappropriating their money to fund his lavish lifestyle. The government has seized $634 million from 21 different bank accounts over the past few months, and seized a Lamborghini Aventador SVJ Roadster from Guo on Wednesday.
- President Joe Biden signed an executive order on Tuesday aimed at expanding background checks for gun purchases, directing the attorney general to “clarify” the definition of a firearm seller “to move the U.S. as close to universal background checks as possible without additional legislation.” Despite this billing, the president has limited executive authority to expand background checks beyond the scope of current laws. The order also directs various federal agencies to “encourage effective use” of red-flag laws and produce a report on how the federal government can better support the “recovery, mental health, and other needs” of individuals and communities affected by gun violence.
- The Environmental Protection Agency announced this week it was proposing a new rule that would limit the amount of per- and polyfluoroalkyl substances—or “forever chemicals”—permitted in the country’s drinking water. The rule, if finalized, would require utilities to tighten their water filtration systems for chemicals that were used in Scotchguard and Teflon for decades and are linked to cancer and reproductive problems. The EPA projects the upgrades would cost nearly $800 million annually, but industry groups have argued that’s a significant underestimate.
- The Surface Transportation Board announced Wednesday it had approved a proposed merger between Canadian Pacific Railway and Kansas City Southern—the largest such transaction in more than two decades. Canadian Pacific Railway and Kansas City Southern were the sixth- and seventh-largest freight carriers in North America—and the combined entity will still be the smallest of the six remaining “major” railroads—but the consolidation comes at a time of heightened scrutiny for the industry after several high-profile derailments.
We All Live in an Australian Submarine
Between another nationwide strike resulting in thousands of tons of trash stacking up on the streets of Paris and three so-called allies unveiling a deal that cost the country more than $40 billion, France is having a pretty tough week. Après la pluie, le beau temps.
The United States, the United Kingdom, and Australia announced on Monday the first major development of their trilateral partnership known as AUKUS: the planned sale of nuclear-powered (not nuclear-armed) U.S.-made submarines to Australia. The three countries also announced a program to boost nuclear submarine construction over the next several decades, train Australian soldiers at American and British submarine bases, and deploy U.S. and U.K. subs to a military base on Australia’s west coast. That may sound like a lot of hullabaloo over a few submarines, but the announcements mark a significant strategic milestone as the three countries look to address rising competition with China in the Indo-Pacific.