Students and rail users ‘penalised by flawed inflation measure’ | Business

Students and rail passengers have been unfairly penalised by the government using a “flawed” measure of inflation that needs to be urgently fixed, according to a highly critical report from peers.

Ministers have been able to use a tactic of “inflation shopping” to select the retail prices index measure of inflation when it stands to benefit the exchequer, and the typically lower consumer prices index to keep a lid on outgoings, the House of Lords economic affairs committee said.

The peers said the government was doing this despite knowing there was an error in the calculation of RPI, which typically made the measure of inflation about 0.5% to 0.8% higher than CPI.

Changes in 2010 to the way in which clothing prices were collected to formulate RPI caused the problem and meant the statistic was “flawed”, the report said.

The committee warned the UK Statistics Authority, responsible for overseeing economic figures, was at risk of breaching its statutory duties and the Whitehall agency’s refusal to fix the problem was “untenable”. While urging RPI to be fixed, it said the government should only use CPI until the error was removed.

The government is gradually moving away from using RPI to CPI, with further plans to use another measurement of inflation known as CPIH, which also includes housing costs as well as the usual price changes measured by CPI.

“Winners and losers” have however been created by the use of RPI instead of CPI in the meantime, according to the committee’s report. Investors in RPI-linked government bonds have been receiving about £1bn more in interest payments each year, even though others have lost out.

Research from the House of Commons library suggested students were saddled with up to an additional £16,000 of debt as a consequence. Average rail fares rose 3.1% at the start of the year, above the rate of increase in average pay packets.

Michael Forsyth, the chairman of the committee, said: “When the government gives money to people it is generally opting to adjust payments for inflation using the consumer prices index. But when it takes money from people, it is generally opting to use the retail prices index, which has been around 1% higher than CPI in recent years. This simply is not fair.”

A spokesperson for the Office for National Statistics, which publishes inflation data on a monthly basis, said: “We agree the RPI has significant shortcomings. We will therefore continue to work closely with our counterparts in government and at the Bank of England and respond to the committee.”

A Treasury spokesperson also said RPI was flawed and added it was moving away from using it.

“Given the extensive use of RPI across the public and private sectors, further moves away from the measure are complex and potentially costly. As set out at budget, the government’s objective is that CPIH will become its headline measure over time and that it will reduce the use of RPI when and where practicable,” the spokesperson said.

Steph Curry helped Jamal Murray bury the Bulls

After the shock wore off from Tuesday’s pounding against the Warriors, Nuggets coach Michael Malone asked his players to learn from what Steph Curry and Klay Thompson had just done to them.

Keep moving like Curry, create space like Thompson, hoist like Kevin Durant.

“Learn from the best,” Malone said.

Jamal Murray cooked the Bulls with seven 3-pointers in Thursday’s 135-105 rout, including six in the game-defining third quarter. Murray rolled off screeners, created separation and exploited lazy closeouts like Curry had done to the Nuggets only two nights earlier.

Asked if he was thinking about Curry during his 22-point third quarter, Murray clapped back.

“No, I had some Jamal Murray in my mind,” he said. “I watched Steph, obviously. I watch Steph as a fan of the game, as my favorite player in the game, what he does, how he doesn’t stop moving, foot work, where he shoots from, how relaxed he is.”

Nikola Jokic nearly had a triple-double himself with 18 points, 11 assists and eight rebounds and even he conceded Murray had the hot hand.

“He kind of looked for himself in that third quarter, to be honest,” Jokic quipped after assisting on two of Murray’s triples in the period.

Murray said most of the film he watches is of himself as a means to get better, but there’s no better shooter for him to emulate than Curry, who killed the Nuggets with eight 3-pointers of his own on Tuesday.

“Steph is a great player to watch, especially as a guy that can shoot, get to the rim, puts pressure on defense and gets downhill and makes passes,” Murray said. “I watch him a lot.”

On a night when the Nuggets shot 50 percent from the 3-point line, burying a season-high 20 3-pointers, Malone said the thing he was most pleased about how Murray found his success.

Ghosn received $9 million improperly from Nissan-Mitsubishi JV: companies

TOKYO (Reuters) – Arrested auto executive Carlos Ghosn improperly received 7.8 million euros ($9 million) in compensation from a joint venture (JV) between Nissan Motor Co (7201.T) and Mitsubishi Motors Corp (7211.T), the companies said on Friday.

FILE PHOTO: Carlos Ghosn, chairman and CEO of the Renault-Nissan-Mitsubishi Alliance, attends the Tomorrow In Motion event on the eve of press day at the Paris Auto Show, in Paris, France, October 1, 2018. REUTERS/Regis Duvignau/File Photo

A joint investigation found that Ghosn, ousted as chairman from both automakers, was compensated by the Netherlands-based JV without any discussion with two other board members, Nissan CEO Hiroto Saikawa and Mitsubishi CEO Osamu Masuko.

Nissan holds a controlling stake in Mitsubishi Motors.

Ghosn, arrested and detained in Tokyo since Nov. 19, has been indicted in Japan on charges of under-reporting his salary for eight years through March 2018, and temporarily transferring personal investment losses to Nissan during the global financial crisis.

Ghosn denies the charges against him. His lawyer, Motonari Otsuru, could not immediately be reached by telephone on Friday.

Reuters reported earlier this week about the alleged improper compensation to Ghosn by the JV and that Nissan was considering filing for damages, citing a source.

Nissan said on Friday that it would consider ways to recover the full amount from Ghosn, and Mitsubishi said it would consider ways to hold him responsible.

The latest allegations are likely to add pressure on the Japanese automakers’ partner Renault (RENA.PA) to cut ties with Ghosn. Unlike Mitsubishi and Nissan, Renault has kept Ghosn as CEO and chairman, but its biggest shareholder, the French government, has been urging it to replace him.

The French automaker holds around 43 percent of Nissan, the biggest partner in the alliance by sales and which in turn holds a non-voting 15 percent stake in Renault. Mitsubishi became the smallest member of the three-way automaking alliance when Nissan in 2016 took a 34 percent stake in the company.

($1 = 0.8780 euros)

Additional reporting by Chang-Ran Kim; Writing by Ritsuko Ando; Editing by Himani Sarkar

Mistaken email prompts man to attend stranger’s bachelor party in Vermont

MONTPELIER, Vt. (AP) — An email about a bachelor party sent to the wrong person has led to an Arizona man taking a trip to a Vermont ski resort to attend the party of someone he doesn’t know this weekend.

William Novak of Phoenix got the email on Jan. 7 about the ski weekend for Angelo. He didn’t know the person but the party with its over-the-top invitation sounded like a good time so he emailed back as a joke to say he was in. Novak, 35, about the same age as the others invited, expected to get no response or one recognizing his humor. Instead, the party-goers from New Jersey and New York agreed that Novak should join the fun.

“When they wrote back and they were like ‘if you’re serious, we’re serious, get here’ I was blown away. I just started cracking up laughing. I was like ‘oh my gosh, these guy seem insane,’” he said.

Likewise, Angelo Onello’s brother, who sent the email, appreciated his humor.

“It started as a joke and ended up being probably a good mistake,” said Devin Onello, who said he and Novak have hit it off ever since.

Novak, a father of a 10-month-old who with his wife has spent much of their savings on renovating their old house, had a hard time rationalizing spending $750 on airfare, ski rentals and lift passes so he started a GoFundMe page with the heading, “Help me go the bachelor party of a stranger.” By the time he and his family had eaten dinner that day, his trip was funded.

He’s only skied once — at age 14 on a church trip — but said he’s up for the adventure.

The party organizers say the weekend will be tough on his liver. Novak told them he’s not much of a drinker, which they said was OK because he could be the designated driver. He offered to bring his Nintendo switch to play but they said Angelo is not much of a video game player. As a spoof he also offered to bring Soduko puzzles, which they took him up on.

Others have also offered to pitch in, with one company offering Hawaiian shirts for the occasion, a Vermont bar providing locally made beer, and a tattoo artist offering to make matching tattoos, which Novak says he declined.

When Novak learned that Angelo and his fiance are expecting a baby, a woman in Mesa, Arizona, where Novak works, made a baby blanket. His neighborhood in Phoenix is also sending a gift bag of locally made items.

Novak plans to fly into Boston and rent a car and drive to Okemo on Friday. He’s changed his route so he can pick up the beer in Brattleboro on the way.

“I’m just the sort of person who tries to be open to things,” he said.


Adams County entices national broadcaster with tax credits

Stay tuned —  a national broadcaster is looking at metro Denver for a major network center.

The Colorado Economic Development Commission on Thursday approved $10.2 million in job growth incentive tax credits to Project Beam, an unnamed media company eyeing Adams County for a new operations facility slated to employ 769 people.

The average annual wage for those jobs was listed at $90,572, which is 170 percent of the average wage in Adams County. Arizona is also in the running, said Michelle Hadwiger, deputy director of the Colorado Office of Economic Development and International Trade.

The company owns news, sports and cable networks and plans to invest $100 million to $150 million in the new facility, which would distribute hundreds of thousands of hours of programming to 200 broadcast affiliates and more than 1,000 satellite and cable stations, Hadwiger told commissioners.

She said the company is highly recognized, publicly traded and a member of the Fortune 500, which narrows the pool of potential candidates.

Comcast, which ranks 33rd on the Fortune 500, owns NBCUniversal and already has a significant presence in metro Denver, mostly on the south side. In 2013, Universal Sports Network moved production operations from southern California to Centennial and Comcast is a repeat customer when it comes to tapping state incentives to support its expansion plans.

AT&T, which ranks 9th on the Fortune list, acquired Time Warner Inc. last summer, giving it control of HBO and Turner Broadcasting Systems, which controls CNN, Turner Sports and The Cartoon Network. It might be on the hunt to consolidate some operations.

There’s also 21st Century Fox, ranked No. 109, and Walt Disney Corp., the owner of ABC and ESPN, at No. 55. CBS Corp., ranked No. 197 on the Forbes list, trades under its own stock, but National Amusements, a privately-held holding company, has voting control.

The second largest incentive award made on Thursday, $1.7 million under the name Project Peacock, went to an American subsidiary of a global information technology firm based in India. The company is looking to set up a facility in Arapahoe County to serve two large clients in the area.

The center, with a focus on video engineering technology, plans to hire 100 full-time positions with an average annual pay of $84,496. Other states in the running include New Jersey and Missouri.

“It will strengthen our relationship with India,” Hadwiger said of Colorado landing Project Peacock.

Asia stocks gain on hopes for eased U.S.-China tension

TOKYO (Reuters) – Asian stocks gained early on Friday, as hopes for a thaw in the U.S.-China trade conflict fed investor appetites for risk assets.

FILE PHOTO: A man is reflected on an electronic board showing a graph analyzing recent change of Nikkei stock index outside a brokerage in Tokyo, Japan, January 7, 2019. REUTERS/Kim Kyung-Hoon

The Wall Street Journal reported on Thursday that U.S. Treasury Secretary Steven Mnuchin discussed lifting some or all tariffs imposed on Chinese imports and suggested offering a tariff rollback during trade discussions scheduled for Jan. 30.

U.S. stocks rallied following the report, but pared some of those gains after a Treasury spokesperson told CNBC that Mnuchin had not made any such recommendations. For the day, all three major U.S. indexes were up, led by a surge in industrial stocks. [.N]

Following Wall Street’s lead, MSCI’s broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS added 0.25 percent. The index has gained nearly 1 percent this week.

Australian stocks rose 0.6 percent, as did South Korea’s KOSPI .KS11 while Japan’s Nikkei .N225 gained 0.7 percent.

“As with 2018, the U.S.-China trade row remains a key market theme in 2019. A slight difference is that there are some signs that the two sides are seeking some sort of a resolution,” said Soichiro Monji, senior economist at Daiwa SB Investments in Tokyo.

“China seems to be running low on options, while the United States would also want to avoid a prolonged conflict given the negative consequences on its markets and the economy,” Monji said.

Chinese Vice Premier Liu He will visit the United States on Jan. 30 and 31 for the latest round of trade talks aimed at resolving the bitter dispute between the world’s two largest economies.

In December, Washington and Beijing agreed to a 90-day truce in a trade war that has disrupted the flow of hundreds of billions of dollars of goods.

Indicators released recently have shown signs that the Chinese economy is losing some momentum.

China’s fourth-quarter economic growth, due to be reported on Monday, likely slowed to the weakest pace since the global financial crisis, a Reuters poll showed, as demand faltered at home and abroad.

In currencies, the dollar was mildly supported after U.S. Treasury yields rose amid the improvement in risk appetite in the broader markets.

The greenback was steady at 109.14 yen JPY= after popping up to a two-week high of 109.40 overnight. The dollar has gained about 0.6 percent against the Japanese currency this week.

The euro was little changed at $1.1392 EUR= after dipping slightly overnight. The common currency was on track for a weekly loss of 0.7 percent.

The 10-year Treasury yield US10YT=RR stood at 2.746 percent after going brushing 2.761 percent the previous day, its highest in three weeks.

The pound stood at $1.2984 GBP=D3, hovering close to a two-month peak of $1.3001 scaled overnight on the back of hopes that Britain can avoid a no-deal Brexit.

Prime Minister Theresa May’s Brexit deal suffered a heavy defeat in parliament this week but she survived a subsequent vote of confidence, removing some political uncertainty for now.

U.S. crude oil futures extended gains after rising the previous day on a rebound in Wall Street and news that OPEC sharply curtailed production in December. [O/R]

U.S. crude futures CLc1 added 0.13 percent to $52.14 per barrel. The contracts have gained 1.1 percent this week.

Editing by Richard Borsuk

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  • Credit card demand faces record drop as Brexit spooks borrowers – as it happened | Business

    Theresa May to miss Davos


    Greek PM wins confidence vote, but pressure remains

    School teachers protesting in central Athens today

    School teachers protesting in central Athens today Photograph: Petros Giannakouris/AP

    Over in Greece, where the government has survived a late-night confidence vote, fears of snap elections have been put on the back burner.

    However, ministers’ relief is being clouded by warnings that, once again, Athens is dragging its feet on reforms.

    A jubilant Alexis Tsipras may have survived the vote – welcoming his narrow 151-148 ballot victory as “a vote of confidence in stability ” – but the challenges before him are far from over.

    The first is passage of the landmark Macedonia name-change accord that prompted the leftist leader to call the confidence motion after the Independent Greeks party, his coalition’s junior partner, quit in protest over it. Pulling the same hat trick is far from certain. With the centrist Potami party wavering, it remains unsure if he will win a decisive majority.

    Although Tsipras has touted the renewal of confidence in his government as the card he needs to push ahead with other initiatives – from increasing the minimum wage to implementing a new payment scheme for unpaid social security contributions – his government faces growing pressure from the creditors who have bailed out the debt-stricken country to keep up with reforms.

    Addressing the Greek-French chamber of commerce and industry in Athens on Wednesday night, the EU Economic and Financial Affairs Commissioner Pierre Moscovici said it was crucial that politicians stayed the course. “Greece has not yet reached the end of the road,” he said insisting that five months after exiting its third international bailout, foreign auditors were still watching the country closely. “The coming weeks will be decisive … it is very important that politicians don’t disengage from the agenda of reforms.”

    Auditors, who return to Greece next week, are especially worried about Tsipras’ pledge to push ahead with handouts – not least raising the minimum wage – and the high stock of nonperforming loans in Greek banks which have played a central role in impeding Athens’ hopes of returning to capital markets.

    Like every government before it, the Tsipras administration faces immense anger over enforcement of reforms with thousands of teachers taking to the streets- and civil servants walking off the job – today.

    Demand for mortgages and credit cards hit by Brexit


    US accused of “technological McCarthyism” over Huawei probe

    China’s Ministry of Finance has hit out at US authorites for launching a criminal probe into Huawei.

    MOFa spokesperson Hua Chunying has told reporters that China is concerned by the “unusual handling” of the case by US prosecutors, suggesting it was driven by political considerations.

    Hua added that if civil cases are used “arbitrarily to suppress Chinese enterprises then this is not only a violation of free and fair business competition but a violation rule of law.”

    China’s media are also critical of the move, giving another insight into Beijing’s thinking.

    Global Times wrote in an editorial today in response to the WSJ story and the proposal from US lawmakers to ban chip sales to Huawei that the ‘persecution of Huawei’ is a form of ‘technological McCarthyism”.

    It says:

    “America’s treatment of Huawei is full of geopolitical daggers… The US is angry because of China’s progress. If China wants to keep developing, China needs to bear these kinds of setbacks.”

    “The US has prevented these companies from remaining separate from politics. The US has branded Huawei and ZTE as political, and this is a technological Mccarthyism.”

    Huawei probe worries markest

    WSJ: US authorities probing Huawei



    Introduction: Japan urges fight against protectionism


    Ben Garland, former Air Force guard, named NFL’s Salute to Service Award finalist

    Atlanta Falcons guard Ben Garland and former Detroit Lions quarterback Eric Hipple are the finalists for the NFL’s Salute To Service Award.

    The recipient of the award, presented by USAA, will be revealed on Feb. 2 during the NFL Honors show when The Associated Press announces its annual league awards, including MVP.

    Garland and Hipple were selected for their efforts to support members of the military community.

    USAA, a provider of insurance and other services to U.S. military members, veterans and their families, will contribute $25,000 in the award recipient’s honor to the official aid societies representing all five military branches. The NFL will match USAA’s donation to the award recipient’s military charity of choice.

    Garland attended the Air Force Academy and just completed his fifth pro season. He recently was selected to become a major in the Colorado Air National Guard.

    Garland is involved with helping veterans adjust to life after service and helping to raise awareness for PTSD. Last year, he participated in the Armed Forces Mission’s Georgia LOSS Walk, when he walked alongside veterans, service members and families for a program called “Turning the Tide on Veteran Suicide.”

    Participating in the military taught Garland lessons that have helped him as an athlete and vice versa.

    “Serving in the Air National Guard has been paramount to my development as a football player,” he said. “It has helped my leadership skills, mental toughness, how to work under pressure, and establish an Air Force core values mindset of integrity first, service before self, and excellence in all we do. I also believe my NFL career has made me a better officer. Over my career, I have had the opportunity to play for some of the best coaches in the world and in doing so was able to study their leadership methods.”

    Garland works year-round with a number of military nonprofits: Merging Vets and Players, Emory Healthcare Veterans Program, Shepherd Center SHARE Initiative and TAPS. He works with Pigskin Patriots to help raise funds and donate time for camps for military children and with Children of the Fallen Patriots Foundation on granting college scholarship funds.

    Hipple retired following the 1989 season after 10 seasons in the NFL. Since his 15-year-old son Jeff’s suicide, Hipple has worked to build awareness and break down the stigma surrounding depressive illnesses.

    In conjunction with NAVY U.S. Fleet Forces, Hipple has conducted workshops on suicide and destructive behavior prevention during the last decade, focusing on mental fitness. His book “Real Men Do Cry” received a publisher Presidential Award.

    After retiring from the University of Michigan’s Comprehensive Depression Center, where he spent 11 years in outreach, Hipple serves as outreach specialist for Eisenhower Center’s “After The Impact” program, a neuro-behavioral residential treatment facility serving military veterans and former NFL players.

    Indian air safety watchdog orders extra checks on planes with Pratt & Whitney engines

    FILE PHOTO: The logo of IndiGo Airlines is pictured on passenger aircraft on the tarmac in Colomiers near Toulouse, France, July 10, 2018. REUTERS/Regis Duvignau

    NEW DELHI (Reuters) – India’s air safety watchdog on Thursday directed airlines to make extra checks on their Airbus A320neo aircraft fitted with Pratt & Whitney engines as part of new safety protocols after temporary grounding orders affected the planes last year.

    IndiGo, India’s biggest carrier by market share, and its low-cost rival GoAir, which fly the A320neos in the country, were forced to ground the aircraft on several occasions due to issues related to the engines.

    The Directorate General of Civil Aviation (DGCA) has ordered that airlines must inspect some parts of the 1100 series engines weekly and train the cabin and cockpit crew to deal with and report any kind of odor, burning smell or smoke.

    “Log all the cases detecting odors/smoke in cabin during operation for necessary investigation and rectification,” the DGCA said in its notification, adding that in all such cases the engine would need to be inspected in detail and used only after the defect is resolved.

    IndiGo, owned by InterGlobe Aviation (INGL.NS), and GoAir did not immediately respond to a request for comment outside of office hours. Airbus and Pratt & Whitney were not immediately reachable. The new rules, which are effective immediately, were issued days after a meeting between the civil aviation ministry, the regulator, the two airlines, aircraft manufacturer Airbus (AIR.PA) and engine maker Pratt & Whitney, owned by United Technologies (UTX.N) to discuss the issues with the engines.

    “During (the) meeting, it was decided to issue directive in addition to the existing measures related to combustion chambers and No. 3 bearing issues for identifying and correcting impending failures of dry face seal,” the DGCA said.

    The notification also said there would be restrictions imposed on the operation of A320neo flights to Port Blair – the capital of India’s Andaman and Nicobar islands.

    It was not immediately clear whether the regulator planned to restrict all A320neo flights to the islands or only place restrictions on a specific series of the engines that have been found to have issues.

    Reporting by Aditi Shah; editing by David Evans