The times. (Gainesville, Ga.) 1972-current, December 26, 2018, Image 11

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The times., December 26, 2018, Image 11

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Newspaper Page TextJeff Gill | Business reporter The Times, Gainesville, Georgia 770-718-3408 | jgill@gainesvilletimes.com Wednesday, December 26, 2018 Trump: Fed is economy’s ‘only problem’ BUSINESS President blames plunge in stock market on Federal Reserve BY MIKE DORNING Bloomberg News WASHINGTON — President Donald Trump blasted the Federal Reserve, blaming it for the plunge in the stock market, following reports he has considered firing Fed chief Jerome Powell. “The only problem our economy has is the Fed. They don’t have a feel for the Market, they don’t understand necessary Trade Wars or Strong Dollars or even Demo crat Shutdowns over Borders,” Trump said in a tweet Monday. “The Fed is like a powerful golfer who can’t score because he has no touch — he can’t putt!” Treasury Secretary Steven Mnuchin sought to reassure finan cial markets over the weekend that Powell’s job is safe. Mnuchin said in a pair of tweets Saturday evening that he’d spoken with the president about the mat ter, and he quoted Trump saying he didn’t believe he had the authority to remove the central bank chief. Mick Mulvaney, the incoming White House chief of staff, said Sunday he’d spoken to Mnuchin and that Trump “now realizes he does not have the ability” to fire a Fed chairman. Prolific tweeter Trump hasn’t directly addressed the issue himself. Trump’s latest attack on the Fed follows a report by Bloomberg News on Friday that Trump had consulted advisers many times in the prior few days over the pos sibility of firing Powell, a move some of those people warned could badly backfire. Top U.S. financial regulators assured Mnuchin during a hastily organized call Monday that they are seeing nothing out of the ordi nary in markets despite the recent stock slump, according to a person familiar with the discussion. Mnuchin spoke with officials from the Federal Reserve, the Securities and Exchange Com mission, the Commodity Futures Trading Commission, the Federal Deposit Insurance Corp. and the Office of the Comptroller of the Currency. The regulators briefed Mnuchin on their plans for moni toring markets during the govern ment shutdown, and the state of markets, said the person. Trump’s dissatisfaction with Powell and the Fed, which he’s expressed many times in the past few months on Twitter and in inter views, appears to have boiled over after Wednesday’s interest rate hike and one of the worst single-week U.S. stock market losses in a decade. Ahead of the central bank’s two-day meeting, Trump again attempted to jawbone the inde pendent policymakers in a tweet that warned against “yet another mistake.” Is it recyclable? Recyclers offer help sorting through that holiday waste LEILA NAVIDII Tribune News Service Jerry Schneider, left, and Pervis Harris sort through holiday lights at Tech Dump in St. Paul on Tuesday, December 18. Reducing wishcycling’ a priority in keeping questionable items from landfills BY ERIC ROPER Star Tribune (Minneapolis) Recycling bins will soon overflow with discarded packaging, wrapping paper and other detritus of the holiday season. But not all of it belongs there, causing extra work this year for the people who sort through our waste. Batteries and holiday lights wreak havoc at local sorting centers, while some toy packaging and disposable cups must take a long and expensive trip to the landfill or incinerator. Even some gift wrap isn’t recyclable. Getting that stuff out of recycling bins is a higher prior ity this year, local recycling companies say, since China no longer wants much of America’s recycling. That has flooded U.S. markets with extra plastic, paper and other recycla- bles. That means sorting centers have to do a better job separating recyclable materials from everything else so they can sell a higher-quality product. “Our chant is, ‘We need to get back to basics,’ “ said Julie Ketchum, a Min nesota-based spokeswoman for Waste Management. “It is about collecting and processing materials that have end-mar kets and that have value. ” The goal is to reduce “wishcycling,” the practice of tossing questionable items in the blue bin in hopes they can be recy cled, which has grown more common with the spread of single-sort recycling. • Holiday lights Holiday lights cause major headaches at sorting centers. Along with hoses and extension cords, they wrap around cylin drical screens at the start of the sorting process and must be frequently removed. “We see a lot of Christmas lights being thrown in the recycling and those are bad,” said Bill Keegan, president of Dem- Con Companies in Shakopee, Minn. The lights can still be recycled, how ever. Check with local authorities for drop-off locations in your area. • Gift wrap Wrapping paper may be recyclable if it is just paper. Generally paper with a foil-like shine or peppered with glitter is destined for the trash. The same goes for any with ribbons and bows. “Some of it can be recycled, but the stuff that can is still a very low-value product,” said Keegan, with Dem-Con. “But a lot of it cannot.” Advice about what to do with basic wrapping paper varies, however. Many counties say to throw it away. Minneapo lis says to recycle it. “It’s very difficult to know 100 percent whether it’s all paper or not,” said Paul Kroening, recycling program manager for Hennepin County, Minn. • Plastic packaging If you needed a knife or a pair of scissors to break open plastic packaging, chances are it isn’t recyclable. The rigid packages are typically called “blister packs.” “To be safe, if an electronic or a toy comes in plastic, that plastic is not recy clable,” said Kate Davenport, co-presi dent of Eureka. Eureka, which processes recycling for Minneapolis and St. Paul, generally wants to see No. 1, No. 2 and No. 5 plastics. Packing peanuts and Styrofoam are made from polystyrene — No. 6 plas tic — which generally is not recyclable. Plastic film, such as bags covering a new computer, is recyclable if taken to retail drop-off locations. • Batteries A big concern lately for sorting centers is fires caused by lithium bat teries improperly tossed in the recy cling bin. Keegan said the recycling industry nationally is losing about one facility a month to such fires, often from rechargeable batteries inside electronics. Batteries should not be recycled in the curbside bin. Some cities, like Min neapolis, will pick up batteries if they are left in a bag atop the recycling cart. • Boxes Boxes are becoming a more common staple of the holidays as people shop more online. The good news is they are very recyclable through curbside bins. Recyclers advise removing tape and any additional material inside and then flattening them. Otherwise, sort ing machines sometimes mistake small cardboard boxes for plastic containers — which must be separated later. • Plates, cups Most paper cups are not recyclable, since they are typically lined with plas tic. Many red plastic Solo cups made from No. 6 plastic are also not recycla ble in many places. Paper plates are also generally not recyclable, but certified compostable plates are accepted by organics collec tion programs. • Trees Thousands of trees are disposed of after the holidays, and most of them are either composted or burned to generate heat and power. Some areas pick them up, while others have drop-off locations. Stocks pushed to brink of a bear market on Christmas Eve BY ELENA P0PINA, SARAH P0NCZEK AND VILDANA HAJRIC Bloomberg News NEW YORK — Battered and bruised for three months, a bull market whose durability has exceeded all others lurched within a few points of its demise on Christmas Eve, extend ing one of the roughest stretches for equities since the financial crisis. By the thinnest of margins, the S&P 500 was spared its first 20 percent decline since 2009, a period that spans two presidential administra tions and three Federal Reserve chairs. Inves tors hoping for a respite from volatility before the break got yet another powerful dose, as the equity sell-off that has defied every hope of end ing showed itself no respecter of holiday cheer. At the end of Monday’s mercifully abbrevi ated session, the benchmark gauge for Ameri can equities sat at 2,351.10, down 19.8 percent from its Sept. 20 close and just seven points from the bear market threshold. Compared with its intraday high on Sept. 21, the gauge is down 20 percent. The Dow Jones Industrial Average fell 1.6 percent to end 1.2 percent above a bear. “Even if 20 percent is just a psychological number, it is psychologically very important,” Chris Zaccarelli, chief investment officer at the Independent Advisor Alliance, said by phone. “We’ve been trading like we’re already in a bear market for the past few weeks. I don’t know if it would create panic, but if we break below the 2344.5 level, that would be very unsettling.” With every big lurch — and there have been a lot lately; the average one-day decline in the S&P 500 this month is 1.6 percent — markets move closer to becoming more than just a problem for investors, but a drag on the econ omy itself. In testimony last week, Fed Chair man Jerome Powell indicated he didn’t see the slump as meaning much for the economy, though the Dow was about 1,500 points higher than it is now when he was speaking. “The markets going down will eventually create an economic problem,” said Ernesto Ramos, head of equities at BMO Asset Manage ment. “We’re not there yet but getting pretty close. People who spend money as consumers, if they have stock exposure, they’re reconsid ering if they’re going to buy a $1,000 present they’ll buy a $200 one. ” Newspapers are “headlining market drops, the worst month since 2008, or worst week since 2008,” Ramos said. “All of these headlines are in the front. They’re not buried in some back page. They’re seeing the market is taking a hit, and their 401k is tied to it.” While a dozen things have been blamed for the plunge — slowing growth, trade tariffs, stretched valuations, Brexit — its latest segment has come amid increasingly frantic emanations from the Donald Trump White House. Over the weekend, Treasury Secretary Steven Mnuchin had to reas sure markets that the president has no plans to fire Powell after Bloomberg reported Trump had discussed the step repeatedly in recent days. Mnuchin took to Twitter again on Sunday to say he’d spoken to heads of the biggest U.S. banks about liquidity and lending infrastruc ture, and reconvened a presidential working group established to sort out the Crash of 1987. While equities have never needed an obvious reason to fall over three months of tumult, it’s safe to say that neither gesture steadied the decline. After booming for years, controversial home improvement loan declining BY ANDREW KH0URI Los Angeles Times A controversial form of financ ing for environmentally friendly home improvements in California has plunged after reform legisla tion kicked in. So-called PACE loans grew in recent years as a way to pay for solar panels and energy-efficient air conditioners. Homeowners in the state took out more than $1 billion worth of them in 2017. However, critics say unscrupulous contractors frequently signed up borrowers with loans they neither understood nor could afford. That helped lead to state legislation that sharply tightened underwriting standards. In the first half of 2018 — the lat est data available — PACE lend ing plunged by 32 percent from a year earlier, according to the state treasurer’s office, which tracks the vast majority of the loans. Lenders blame much of the recent drop-off on a new under writing law they say blocks too many qualified applicants. Con sumer groups say it’s too early to know the exact effect. But they don’t deny regulation is having an effect. It was, they note, designed to have one. “It’s a positive development that people don’t get trapped in financ ing that they can’t afford,” said Nicholas Levenhagen, an attorney with pro-bono law firm Bet Tzedek. “To the extent there has been a reduction following recent legisla tion,” he said in a later email, “it is telling that this has occurred fol lowing the implementation of basic consumer protections.” Property Assessed Clean Energy programs, first started in 2008, are typically established by local governments to reduce green house gases. Loans are financed through private lenders such as Renovate America, Renew Finan cial and Ygrene that use contrac tors to market their products and sign up consumers. Local govern ments, which collect fees for their services, then secure the loans to the home through a lien, allowing them to be repaid as line items on property tax bills. If the loans go unpaid, a home- owner can be foreclosed upon. The unique product got off to a slow start. But by 2015, the market was exploding. In the second half of 2014, lenders issued $148.7 million worth of new loans in California, according to state data; during the same period a year later, volume jumped nearly fourfold, to $553.9 million, as more counties added the program. A year later, loan volume rose nearly 50 percent. Helping drive growth was an approval process built for speed. Approval was largely based on home equity — with income not a factor. Contractors could get people approved on the spot by handing over a tablet computer and asking for signatures. Lenders sent the financing contracts to bor rowers via email, making it possi ble for borrowers to sign up within hours and in some cases after they spoke only with the contractor. Some lenders even used online systems that enabled contractors to type in an address and know the maximum a homeowner could be eligible for, allowing them to target those with lots of equity and upsell until a homeowner had signed up for the maximum possible borrowing. As PACE grew, consumer groups said, homeowners who couldn’t afford payments inundated them with phone calls. Many of them were seniors who found the online approval process confusing. A common complaint was that con tractors misrepresented how the loans worked. “I was out-talked and sweet- talked,” said Lawrence Linthicum, a 90-year-old Inglewood resident who said it wasn’t until after he took out two PACE loans that he discovered the cost: nearly $8,300 annually. PACE companies say the vast majority of their customers come away happy and foreclosures on homes with PACE are extremely rare. But as stories of distressed borrowers increased, companies took steps to add more protections, including calling all homeowners to confirm loan terms _ something not all did at first. The state Legislature also passed a series of reforms. The most sig nificant came in October 2017 when Gov. Jerry Brown signed into law a requirement that lend ers check income and other debt obligations to ensure people could repay their loans. Another law barred kickbacks to contractors and prohibited lenders from telling contractors the amount of financ ing homeowners were eligible for. Lenders were also now required, by law, to call homeowners to con firm terms, and the state Depart ment of Business Oversight was given authority to regulate the industry.