Aurelia Butler

Having a strong education and vocational training system is important to Germany’s economy, Europe’s largest, which relies on skilled labour to support its high-end products and services.”Germany has been left behind to a certain extent in the strong expansion of education that has taken place throughout the European Union in recent years,” according to the study of the IW, to which Reuters had access on Saturday. In the European Union, the proportion of workers between the ages of 25 and 64 without a vocational qualification or higher education fell to 20.7% in 2021 from 27% in 2011, thanks to a dynamic expansion of education in southern Europe. However, in Germany, this share of the population rose slightly to 15.2% in 2021 from 13.4% 10 years before, the study showed.Among young professionals, those aged 25 to 34 years old, the proportion of highly qualified people with tertiary education was significantly lower in Germany at 35.7%, compared to 41.2% on average in the European Union.”This should be seen against the background of the very special position of vocational education and training in Germany,” the IW said. If one looks at the segment of young professionals with tertiary and secondary vocational training together, Germany has a significantly higher share of 77.0% of educated professionals than the 73.4% for the European Union. “With the changing demands on employees in the context of digitalisation, decarbonisation and de-globalisation, it is becoming increasingly important for Germany and Europe that the working population achieves the highest possible level of qualification,” the IW said.The IW, a private research institute advocating for German employers, said the government should ensure through early and intensive support that all children in the country are able to acquire a vocational qualification. More

WASHINGTON (Reuters) -President Joe Biden on Friday pledged to “have a discussion” with House of Representatives Speaker Kevin McCarthy on U.S. debt amid a looming debate about raising the debt ceiling.At an event with city mayors, Biden said a U.S. debt default would be a calamity unlike anything ever seen in the United States financially. “The debt we’re paying on, and we’re gonna have a little discussion about that with the new majority leader of the House, has accumulated over 200 years,” Biden said, not citing McCarthy by name.He did not provide details on when he might talk to McCarthy, the newly named Republican Speaker who wants to link a vote to raise the debt ceiling to government spending cuts.McCarthy said in a tweet addressed to Biden that he “accepted your invitation to sit down and discuss a responsible debt ceiling increase to address irresponsible government spending.”White House spokeperson Karine Jean-Pierre said in a statement that Biden looked forward to meeting with McCarthy to “discuss a range of issues” as part of a number of meetings he is holding with new congressional leaders.”Like the President has said many times, raising the debt ceiling is not a negotiation; it is an obligation of this country and its leaders to avoid economic chaos,” she said.Biden is hosting Democratic congressional leaders at the White House on Tuesday. A White House official said no date had been set for a McCarthy visit.The White House has said repeatedly it will not negotiate over raising the debt ceiling and has used some Republican proposals for spending cuts to draw a contrast with Democratic priorities.”As for the broad economic debate in our country, the Speaker and his allies have said that they have a fiscal plan to cut Social Security, cut Medicare, cut other vital programs, and impose a 30 percent national sales tax,” Jean-Pierre said, referring to U.S. social safety net programs. “We are going to have a clear debate on two different visions for the country – one that cuts Social Security, and one that protects it – and the President is happy to discuss that with the Speaker.” More

NEW YORK (Reuters) – A spate of earnings reports in coming weeks is set to test a recent bounce in technology and other megacap stocks, a category whose leadership position in U.S. markets has faltered after last year’s deep selloff.The tech-heavy Nasdaq 100 index has gained nearly 6.2% in 2023, compared to a 3.45% rise for the S&P 500. Shares of some megacap companies – which include those grouped outside of tech in sectors like communication services and consumer discretionary – have shot higher, with Amazon (NASDAQ:AMZN), Meta Platforms and Nvidia (NASDAQ:NVDA) posting double-digit percentage increases.Several factors are driving that outperformance, including investors piling into stocks they believe were overly punished in 2022. A moderation in bond yields, whose jump last year particularly pressured tech-stock valuations, is also likely helping the group, investors said.Now, however, the focus is shifting to whether these companies can withstand a widely expected economic downturn while supporting valuations that some investors believe are too high.”To keep this rebound going, the guidance for ’23 has to be less worse than what people are anticipating,” said Peter Tuz, president of Chase Investment Counsel, whose firm recently pared its holdings in Apple (NASDAQ:AAPL) and Microsoft (NASDAQ:MSFT).Tech and growth stocks led U.S. equity markets for years following the 2008 financial crisis, aided by near-zero interest rates. They struggled along with broader markets last year as the Federal Reserve raised rates to fight surging inflation, and some investors doubt they will regain the market’s pole position any time soon. The Nasdaq 100 fell 33% in 2022, while the S&P 500 lost 19.4%.The top six stocks by market value in late 2021 – Apple, Microsoft, Alphabet (NASDAQ:GOOGL), Amazon, Meta and Tesla (NASDAQ:TSLA) – have seen their collective weight in the S&P 500 fall from 25% to 18%, according to Strategas Research Partners.That dynamic echoes a pattern seen after the market’s dot-com bubble burst after the turn of the century. The six biggest stocks at that time saw their collective weight in the S&P 500 decline to 5% from a peak of 17% over a number of years, according to Strategas.”This leadership unwind … is going to be one that is measured in years, not in months or quarters,” said Chris Verrone, head of technical and macro research at Strategas. GRAPHIC: Megacaps as percentage of S&P 500 (https://fingfx.thomsonreuters.com/gfx/mkt/lgvdklgxopo/Pasted%20image%201674158978610.png) EARNINGS TESTCompanies comprising over half the S&P 500’s market value are due to report results in the next two weeks, including Microsoft, the second-largest U.S. company by market value, on Tuesday, Elon Musk’s Tesla and IBM (NYSE:IBM) on Wednesday and Intel (NASDAQ:INTC) on Thursday. Apple, the largest U.S. company by market value, and Google-parent Alphabet report the following week.Fourth-quarter earnings in the tech sector are expected to have declined 9.1% from a year ago, compared to a 2.8% decline for S&P 500 earnings overall, according to Refinitiv IBES. A critical question for many megacaps, once heralded for their stellar growth, is whether they can increase revenue and profits significantly while cutting costs in the face of a possible recession. Alphabet Inc said Friday it is cutting about 12,000 jobs, or 6% of its workforce, the latest tech giant to announce layoffs. Microsoft on Wednesday said it would eliminate 10,000 jobs while Amazon started notifying employees of its own 18,000-person job cuts.”The biggest positive could be if they could show a control of expenses while keeping at least reasonable growth intact,” said Rick Meckler, partner at Cherry Lane Investments in New Vernon, New Jersey. “It’s a hard balancing act.” GRAPHIC: Looming U.S. earnings recession (https://www.reuters.com/graphics/GLOBAL-MARKETS/jnpwywrygpw/chart.png) Valuations for tech and megacap companies have moderated after last year’s selloff, though they still stand above those of the broader market. The S&P 500 tech sector still trades at a roughly 19% premium to the broader index, above its 7% average of the past 10 years, according to Refinitiv Datastream.Nonetheless, some investors are reluctant to bet against tech stocks.The Wells Fargo (NYSE:WFC) Investment Institute counts tech as one of its favored U.S. sectors. The firm expects an economic downturn and believes many tech companies have businesses that are resilient to economic uncertainty, said Sameer Samana, a senior global market strategist there.”It’s just too important and too big a weighting not to participate,” Samana said. “But the years of handily outperforming the S&P are probably now behind us.” More

(Reuters) – The U.S. accounting watchdog is facing a lawsuit over claims the regulator’s process of handling disciplinary matters behind closed doors is unconstitutional.The lawsuit, filed Thursday in federal court in Texas by the conservative Washington-based New Civil Liberties Alliance, accuses the Public Company Accounting Oversight Board (PCAOB) of bringing a “secret prosecution” without due legal process against an accountant working for a firm in Colombia.The PCAOB is a non-profit body lawmakers created in the wake of the Enron-era securities fraud scandals of the early 2000s meant to monitor and oversee the audits of public companies to protect investors and ensure accurate, independent reports.The complaint, which describes the Board’s disciplinary process as “biased” and “secretive”, marks the latest challenge from pro-industry groups challenging federal regulators’ authority. Other lawsuits have taken aim at the constitutionality of the Consumer Financial Protection Bureau and of the use of in-house tribunals in cases brought by the U.S. Securities and Exchange Commission.PCAOB spokesperson Jennifer Donohue declined to comment in detail on the challenge, saying only: “The PCAOB is laser-focused on protecting investors.”In their complaint, the New Civil Liberties Alliance, a Washington pressure group that opposes what it calls the “unconstitutional administrative state,” claims the PCAOB unfairly targeted an unnamed accountant in confidential proceedings, claiming the individual failed to cooperate with an inspection of an audit related to a publicly traded company’s annual financial statements.The group also claims the PCAOB is unsupervised by duly appointed government officials and not subject to meaningful oversight. The SEC oversees the board and can review its findings, which are also subject to challenge in court.PCAOB Chair Erica Williams said in an interview last year that she would support legislative changes that would make the board’s proceedings public, like many other regulators.While criticizing the secrecy of PCAOB disciplinary proceedings, the lawsuit also seeks to maintain the anonymity of plaintiff “John Doe,” citing protections under the Sarbanes-Oxley reforms enacted in 2002. More

DAKAR/WASHINGTON (Reuters) -Treasury Secretary Janet Yellen on Friday warned that the U.S. government cannot choose to pay some bills over others if Congress fails to raise the borrowing limit, as President Joe Biden and top Republican Kevin McCarthy made plans to meet to discuss the issue.Speaking to reporters in Senegal, Yellen warned that Washington could spur a global financial crisis and undermine the role of the dollar if it does not raise the $31.4 trillion debt limit. She said the Treasury Department cannot prioritize its payments, as some Republicans have suggested.”Treasury systems have all been built to pay our bills, to pay all of our bills when they are due and on time, and not to prioritize one form of spending over another,” she said.Government officials and outside experts say that prioritizing certain payments over others would mark a radical departure that likely would shake global economies.Biden, meanwhile, told a gathering of U.S. mayors that “we’re going to have a discussion” with Republican House of Representatives Speaker McCarthy about raising the U.S. debt ceiling.McCarthy said on Twitter he would meet Biden to “discuss a responsible debt ceiling increase to address irresponsible government spending.”It was unclear when the conversation would occur or what message Biden intends to deliver to McCarthy, who is under pressure from far-right Republicans to withhold action on a debt limit increase until significant U.S. budget cuts are first sketched out.White House officials have previously said they will not negotiate over raising the debt ceiling, and administration officials are betting that Republicans will eventually buckle under pressure from investors and businesses worried about the prospects of default. The U.S. government hit its $31.4 trillion borrowing limit on Thursday, a figure that reflects money already spent by the government. Yellen has informed congressional leaders that her department had begun using extraordinary cash management measures to stave off default until early June.Yellen’s remarks came as she kicked off a 10-day trip to Africa to discuss economic growth on the continent.But the percolating battle over the U.S. debt limit later this year already is rattling markets and investors. They are worried over the prospects of an historic default by Washington if budget disagreements cannot be ironed out.Yellen said in an interview with CNN that a potential U.S. default could damage the global economy.”It could cause a global financial crisis. It would certainly undermine the role of the dollar as a reserve currency that is used in transactions all over the world,” she said, adding that in such a scenario many people would lose their jobs and see their borrowing costs rise.Yellen noted the debt ceiling needs to be raised to cover borrowing on spending already authorized by Congress.”It is simply about paying bills Congress has already authorized,” she told CNN. “This is something you can’t negotiate over or bargain about.”Former President Donald Trump, who already launched a 2024 campaign for the White House, urged fellow Republicans to back away from seeking cuts that he said would “destroy” the popular Social Security program for retirees and the Medicare health program for those age 65 and older. More