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China’s economic activity falters as challenges mount

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China’s economic activity falters as challenges mount

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China’s industrial output and retail sales faltered in August as the economy lost momentum, adding to expectations Beijing will step up stimulus efforts in the final months of the year.

Industrial output grew at the slowest pace since March while retail sales, a gauge of consumption, had their second-slowest month of the year, data from the National Bureau of Statistics showed, despite August being the summer holiday month.

The NBS said “in general the economy was operating smoothly in August”. But it said economic activity “still faces many difficulties and challenges in its continued recovery”, blaming an adverse external environment and “insufficient” domestic effective demand.

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Industrial output rose 4.5 per cent year on year, down from 5.1 per cent in July and missing the average forecast of analysts polled by Bloomberg of 4.7 per cent. Retail sales rose 2.1 per cent against a year earlier compared with 2.7 per cent in July and against analysts’ average forecasts of 2.6 per cent.

President Xi Jinping this week called for officials to meet the country’s annual economic and social development goals, which analysts interpreted as urging them to hit this year’s gross domestic product growth target of 5 per cent year on year.

Xi has focused on industry, particularly in the high-tech manufacturing sector, to offset a three-year property slump that has hit household consumption and undermined investor confidence.

The housing crisis has created what analysts call a two-speed economy, with exports increasing rapidly, especially in terms of volumes of shipments, while domestic demand has been more sluggish.

“China’s growth momentum has slowed rapidly in recent months,” Raymond Yeung, chief economist, Greater China for the Australia and New Zealand Banking Group, said this week.

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He said the gap between China’s official growth target and the final figure could be as much as 0.4—0.5 per cent. “This will likely prompt the authorities to release a stimulus package,” he wrote in a report.

The August data also showed that fixed asset investment grew at the slowest pace since last December while the housing market continued to plunge.

Fixed asset investment grew 3.4 per cent between January and August, compared with 3.6 per cent between January and July. Analysts polled by Bloomberg had forecast about 3.5 per cent.

Excluding real estate, however, fixed asset investment increased by 7.7 per cent year on year between January and August, with infrastructure investment — one of the main targets of government stimulus — up 4.4 per cent year-on-year and manufacturing investment 9.1 per cent higher.

Real estate development investment, meanwhile, fell 10.2 per cent while the sales area of ​​new commercial housing — estimated in square metres — was down 18 per cent.

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The government has so far announced only incremental measures to try to stabilise the housing market and rekindle household demand.

But China’s two-speed economy faces growing risks, analysts said, with its lack of domestic demand and increasing export volumes generating tensions with trade partners.

“Real exports are up 14 per cent over the past year, and China may face more tariffs from trading partners if there is sustained further expansion in the goods trade surplus,” Goldman Sachs said in a research note.

“China may have to stimulate domestic demand to balance the risk of new tariffs dragging on growth and exacerbating disinflation.”

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Apalachee High's Coach Hancock: ‘We are one Apalachee’

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Apalachee High's Coach Hancock: ‘We are one Apalachee’

Apalachee High School’s head football coach, Mike Hancock, is grappling with the loss of one of his assistant coaches while trying to be a source of support for his players following a tragic school shooting. 

Hancock said there is no game scheduled at the moment, as the team focuses on healing. “I want to make sure my boys aren’t just ready physically, but mentally as well,” he said. 

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“Apalachee strong means we are together. We are one Apalachee,” said Hancock, reflecting on the school’s motto during this difficult time. 

Strong faith, heavy prayers, and genuine encouragement are what Hancock says are helping him through this life-changing ordeal. “The times I’ve been able to get my eyes on my kids, being able to hug them and love them—those things have been big,” he added. 

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The community is still in shock after authorities reported that Colt Gray opened fire inside Apalachee High School, killing two teachers and two students, and injuring nine others. One of the victims was Richard Aspinwall, a member of the football coaching staff, known to the team as “Coach A.” 

“There’s not a whole bunch of football coaches that teach high-level math, but he was one of those,” said Hancock, reflecting on Aspinwall’s unique role at the school. “He had a great smile, and you knew that when a kid messed up a play, they knew… but at the end of practice, he would put his arm around them or make notes of practice.” 

Apalachee High School’s head football coach, Mike Hancock, sits down with FOX 5 to talk about losing one of his coaches and the healing the school faces.  (FOX 5)

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“That was him as a teacher, and he took pride in that. He wanted to be a great teacher, not just a great coach,” Hancock added. 

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Currently, there is no word on when the sports teams will return to the field. However, Hancock noted the small moments of joy that have emerged during this challenging time. “In the times we’ve gotten together as a football team… seeing kids smile—so many parents have said they saw their kids smile for the first time. We’ve been able to get together twice now for football.” 

For many, sports and their passions have become a means of healing. Hancock stressed the importance of ongoing support. “They are going to need time to heal and take care of their mental health. I think that’s overlooked in this—people are here for us now, but two weeks, three weeks from now, we have to make sure we are checking on our young people.” 

Meanwhile, school officials on Friday announced plans to start having students return to class the week of Sept. 23. 

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Boeing faces cash crunch as machinists’ strike weighs on production

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Boeing faces cash crunch as machinists’ strike weighs on production

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A strike at Boeing has cast doubt on the company’s production goals for the 737 Max and raised the spectre of a cash crunch, as its chief financial officer on Friday said the company would fight to preserve its investment-grade credit rating.

Boeing’s investment-grade rating is crucial to its operations and losing it would be a serious blow, meaning the company could face a punishing increase in borrowing costs given a debt load that has swelled to $53bn. The options to keep it would likely include some kind of securities offering to shore up cash.

About 33,000 workers with the International Association of Machinists District 751 walked out at 12:01am on Friday after rejecting a tentative agreement with the company. Chief financial officer Brian West said Kelly Ortberg, the new chief executive is “personally engaged” in addressing the situation.

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In June and July Boeing had been building roughly 25 Maxes a month, with plans to raise that to 38 by the end of the year. But West told investors on Friday that “now, obviously, that is going to take longer”.

“I can’t comment on 38 per month,” he said. “That rate is so dependent on the duration of the strike.”

Boeing’s share price closed down nearly 4 per cent at $156.77.

The company has slowed production of the Max this year as it tries to improve the quality of its manufacturing process. Boeing has been scrutinised by regulators, prosecutors and the flying public since January when a door panel, which was missing several bolts, blew off a commercial jet midflight. The US Federal Aviation Administration has capped the group’s production at 38 a month.

The slowdown has cost Boeing billions in free cash flow. A lengthy strike would impede the company’s ability to deliver planes to customers, further hurting its cash flow.

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The credit rating agencies are closely watching Boeing’s deliveries and ability to generate cash. All three have the group rated one notch above junk, on a negative outlook. Moody’s on Friday said it had placed the company on review for a downgrade.

“Boeing’s investment-grade credit rating has limited headroom for a strike,” said Fitch Ratings analyst Dino Kritikos. “If the current strike lasts a week or two, it is unlikely to pressure the rating. However, an extended strike could have a meaningful operational and financial impact, increasing the risk of a downgrade.”

When asked if Boeing may raise debt or equity before early 2025, West said the company had two priorities: keeping its investment-grade rating and stabilising its supply chain and factory floor.

“That last objective just got harder based on last night,” he said. “So we are perfectly comfortable to supplement our liquidity position to support these two objectives.”

West said it has told suppliers which are not behind on their deliveries to stop shipping to Boeing’s factories in Renton, Washington. Supply schedules remain untouched for the group’s South Carolina plant, which builds the 787 and is not unionised.

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The work stoppage is “disappointing”, West said, “because things were starting to move in the right direction”.

“We’re working every responsible lever to do what’s right to conserve cash,” he said. “Our expectation — and I don’t have any timetable — is to want to get back to the table and hammer out a deal.”

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'Baby Reindeer' is an Emmy favorite — and facing a lawsuit at the same time

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'Baby Reindeer' is an Emmy favorite — and facing a lawsuit at the same time

Richard Gadd as Donny Dunn (left) and Jessica Gunning as Martha (right) in Netflix’s Baby Reindeer.

Ed Miller/Netflix


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Ed Miller/Netflix

Netflix’s darkly comic Baby Reindeer was one of the breakout hits of 2024. It’s an Emmy favorite, with 11 nominations ahead of Sunday night’s awards, including for best limited or anthology series. But it’s also in the midst of a legal battle, brought on by a woman who believes she inspired a main character in the show.

Scottish comedian Richard Gadd, wrote, starred in, and executive produced the series, which he first developed for the stage. In Baby Reindeer, which spent three weeks as the top English-language TV show on Netflix this spring, he relates his experiences of being a struggling standup comic and bartender, stalked by a woman named Martha. In the story, they meet at a London pub where he works. She flirts with his character, Donny Dunn, and calls him her “baby reindeer” in a series of emails, DM’s and voicemails.

In a video for Netflix and in statements to the media, Gadd has said the story is autobiographical, and that he went to great lengths to disguise the real-life identities of the characters. In the show, he depicts his own tortured history and behavior, and shows Martha sexually assaulting him and attacking his lover. On-screen, Martha is portrayed as a convicted stalker who’s spent time in prison.

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The ‘real’ Martha?

After Baby Reindeer began streaming, a Scottish woman named Fiona Harvey claimed the character Martha was based on her. On the TV show Piers Morgan Uncensored in May, Harvey called the show “obscene,” and “a work of fiction, it’s a work of hyperbole.” She said she did meet Gadd a few times, but never sent him as many messages as Martha did in the show; she said she did have a toy reindeer, but “it was a joke.”

She’s suing Netflix for $170 million for defamation and has asked for a jury trial in California. Central to the lawsuit, filed in June in the Central District of California, is the fact that Baby Reindeer labels the show’s events a “true story” in the first episode — which the suit argues is “the biggest lie in television history.” Harvey claims, among other things, that she’s never been convicted of a crime and never sexually assaulted Gadd.

As a result of being depicted and “defamed” in Baby Reindeer, Harvey “was immediately identified by members of the public and received hate mail and death threats so intense that Harvey suffers from insomnia, panic attacks, and has a general fear of going outside,” according to a plaintiff’s statement in a recent filing in the case.

Netflix, which distributed the series, told NPR in a statement that the network intends to “defend this matter vigorously and to stand by Richard Gadd’s right to tell his story.”

Questions about the character — even before the lawsuit

Even before Harvey’s lawsuit, the character of Martha seemed to be raising questions. In May, Netflix’s Senior Director of Public Policy, Benjamin King, told the U.K.’s Culture, Media and Sport Select Committee that Martha was based on a “convicted stalker” – but later wrote to the committee chair to clarify: “The person on whom the show is based – who we have at no point sought to identify – was subject to a court order rather than a conviction.” According to a Netflix spokesperson, this letter “does not impact our legal position.”

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Though Baby Reindeer‘s first episode opens by calling the show a “true story,” each episode includes a line in the credits noting that, “This program is based on real events: however, certain characters, names, incidents, locations, and dialogue have been fictionalized for dramatic purposes.”

Gadd submitted a written declaration in July saying that the series is a fictionalized retelling, not a documentary.

The network’s attorney Marvin Putnam filed a statement in court that while Baby Reindeer “is inspired by Gadd’s real-life trauma and emotions, the characters, scenes, dialogue, and events convey Gadd’s story in an imaginative style.”

In the latest court filings, Putnam wrote, “Harvey did, in fact, harass and stalk Gadd in real life. She sent him thousands of emails, handwritten letters, and social media posts, and left him hours of voicemails. Many of those communications, which Gadd provided to the police, included prurient, violent and astoundingly racist, xenophobic, homophobic, and otherwise hateful content.”

Netflix’s motions to strike and dismiss the lawsuit are still pending before the court.

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