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NEW YORK — Large US banks reported better-than-expected results on Tuesday on an improving economy, but cautioned that the recovery could falter if Washington fails to enact new stimulus measures.

"It's important and it needs to happen as quickly as possible," said Citi Chief Financial Officer Mark Mason, who added that massive spending from Washington has helped avert a tidal wave of delinquencies, so far.

JPMorgan Chase executives warned of "double-dip" recession if there is not another package. That takes place when a second period of economic contraction follows an initial recovery.

"The people we need to help the most are small businesses and the unemployed," said JPMorgan Chief Executive Jamie Dimon, who said Washington's actions will determine whether it needs to take much higher reserves for bad loans. 

"If the better outcomes happen" with a good stimulus package, "we are over reserved by $10 billion", he said. But if there is a double-dip recession, the bank could be "unreserved by $20 billion", Dimon added. 

The comments came as both JPMorgan Chase and Citigroup released earnings that showed a big improvement from the last two quarters, when both companies set aside billions of dollars in reserves for bad loans in the wake of coronavirus shutdowns.

How many bad loans? 

JPMorgan Chase, kicking off a deluge of results from large financial companies, reported $9.4 billion in profits, up four per cent from the year-ago period as revenues were down slightly at $29.9 billion.

But after nearly $20 billion in credit costs in the first half of 2020, JPMorgan reported just $611 million in credit costs in the third quarter. That figure included a boost from $569 in reserve releases.

As in the second quarter, when volatility boosted trading activity, JPMorgan again scored higher revenue from its markets division. 

On the downside, the bank reported a decline in net interest income in the wake of Federal Reserve actions to keep rates low to boost the economy.

The big bank lifted its forecast for the US economy and now projects a fourth-quarter contraction of 5.4 per cent and a second-quarter 2021 contraction of 3.7 per cent, both incrementally better than their forecasts in the second quarter.

Chief Financial Officer Jennifer Piepszak said many consumers have higher cash balances than before the pandemic and have avoided taking on debt.

"Things do feel better than we thought they would," she said, adding that "the uncertainty is still very very high".

Citigroup reported a 34 per cent drop in quarterly earnings to $3.2 billion behind a seven per cent decline in revenues to $17.3 billion.

The results featured the same basic trends as at JPMorgan, boosted by strong trading results and lower reserves for bad loans.

At the same time, Citi was buffeted by a hit from lower interest rates and by a $400 million civil penalty from US regulators over lax internal controls announced last week by US authorities.

Households have been spared bruising delinquencies in the pandemic due to hefty US fiscal relief spending earlier in the year, bank executives said. But the stalemate in Washington over new stimulus looms as a risk for the US economy. 

"The stimulus programme that was announced has been quite beneficial. It has bridged many consumers," Mason said. "The longer we go without some kind of vaccine that's been tried and tested, the greater the need for additional stimulus." 

Shares of JPMorgan dipped 0.2 per cent to $102.23, while Citigroup dropped 1.3 per cent to $45.28 in early trading.

STOCKHOLM — US economists Paul Milgrom and Robert Wilson won the Nobel Economics Prize on Monday for work on commercial auctions, including for goods and services difficult to sell in traditional ways such as radio frequencies, the Nobel Committee said.

The duo was honoured "for improvements to auction theory and inventions of new auction formats", the jury said.

The Royal Swedish Academy of Sciences noted that the discoveries by Milgrom, 72, and Wilson, 83, "have benefitted sellers, buyers and taxpayers around the world”, it said in a statement.

"Auctions affect all of us at every level. Moreover, they are becoming increasingly common and increasingly complicated," the academy said, listing examples such as flexible electricity prices set by daily auctions and countries raising funds through government bond auctions.

Wilson, a professor at Stanford in the US, was spotlighted for developing a theory on auctions focusing on a common value, such as the future value of radio frequencies, or the rights to extract minerals in a particular area.

This common value "is uncertain beforehand but, in the end, is the same for everyone", according to the academy.

Wilson's work, which resulted in three influential papers in the 1960s and 1970s, showed why bidders tended to bid under what they actually thought the good was worth.

The answer was that they feared the "winner's curse", or winning the auction but paying too much.

Milgrom then came up with a more general theory of auctions by analysing bidding strategies in different auction forms, publishing his seminal papers around 1980.

Also a professor at Stanford, Milgrom and Wilson live on the same street.

The academy noted that while "people have always sold things to the highest bidder", societies have also had to allocate "ever more complex objects... such as landing slots and radio frequencies" among users.

"In response, Milgrom and Wilson invented new formats for auctioning off many interrelated objects simultaneously, on behalf of a seller motivated by broad societal benefit rather than maximal revenue," the academy said.

Their theories were put into practice by US authorities in 1994 to sell radio frequencies to telecom operators, and are applied by governments around the world in the current rollout of 5G networks.

The winners will share the prize sum of 10 million Swedish kronor (about $1.1 million, 950,000 euros).

Speaking to reporters in Stockholm via a telephone link, Wilson said the announcement had been "very happy news", conceding that despite his research focus he himself had "never participated in an auction".

However, he quickly had to retract his statement. "My wife is pointing out that we bought ski boots on eBay, I guess that was an auction," Wilson said.

Last year, the honour went to French-American Esther Duflo, Indian-born Abhijit Banerjee of the US, and American Michael Kremer for their experimental work on alleviating poverty.

Not created 

by Alfred Nobel 

Even if it might be the most prestigious prize an economist can hope to receive, the economics prize has not reached the same status as the awards originally chosen by Alfred Nobel in his 1895 will founding the awards, which included medicine, physics, chemistry, literature and peace.

It was instead created in 1968 through a donation from the Swedish central bank and detractors have thus dubbed it "a false Nobel".

Since the prize was first awarded in 1969, Americans have dominated the category, accounting for 63 out of 86 laureates, including those with dual citizenship.

The award closes the 2020 Nobel season, which saw the closely-watched peace prize awarded to the UN's World Food Programme.

Women have been more prevalent than usual this year, with four laureates in total.

But while the number of female winners has risen sharply since the turn of the century, they still represent only about one out of every 20 Nobel medals since 1901.

Winners would normally receive their Nobel from King Carl XVI Gustaf at a formal ceremony in Stockholm on December 10, but the coronavirus pandemic means it has been replaced by a televised ceremony showing the laureates receiving their awards in their home countries.

LONDON — The British government on Friday said it would pay up to two-thirds of staff monthly wages to firms forced to close over the winter months, as infection rates skyrocket.

Finance minister Rishi Sunak extended a scheme launched just two weeks ago for workers taking reduced hours to help businesses required to shut as part of efforts to cut transmission rates.

More than 42,000 people have died in the outbreak in Britain — the worst toll in Europe — and concern is mounting about a potentially deadlier second wave, and its social and economic impact.

The UK economy grew by a weaker-than-expected 2.1 per cent in August and remained far down on pre-pandemic levels, official data showed on Friday.

It shrank by a fifth in the second quarter, entering recession on the back of a full lockdown that was only eased in June.

Under the extended scheme, businesses will receive grants to pay the wages of staff who cannot work, with the government paying two-thirds of each employee's monthly salary up to a maximum of £2,100 ($2,715, 2,309 euros) per month each.

Their employers will pay national insurance and pension contributions but will not be asked to contribute towards wages, unlike other firms using the scheme.

"Throughout this crisis my priority has always been to protect jobs, so today I'm announcing an expansion of our jobs support scheme, specifically to protect those jobs of people who work in businesses who may be asked to close," Sunak told reporters.

"If that happens those workers will receive two-thirds of their wages for the time that they're unable to go to work."

'Safety net' 

"I hope this provides reassurance and a safety net for people and businesses in advance of what may be a difficult winter," Sunak added.

A Treasury source estimated that the expanded scheme would cost "hundreds of millions" of pounds a month.

From November, the government will nevertheless water down its nationwide jobs support that has helped keep millions of people in employment during the pandemic.

Many analysts fear this will lead to a surge in unemployment, with the hospitality sector particularly affected.

Sunak denied on Friday that his latest enlarged scheme would replicate the so-called furlough plan, which ends in late October.

"This is a very different scheme to what we've had before. This is not a universal approach," he told reporters.

"This is an expansion of the jobs support scheme specifically for those people who are in businesses that will be formally or legally asked to close so in that sense it's very different.

"I've always said that we will adapt and evolve our response as the situation on the health side adapts and evolves. That's what's happening."

WASHINGTON — Software giant Microsoft will let employees work from home permanently if they choose to, US media reported on Friday, becoming the latest employer to expand work-from-home provisions prompted by the Covid-19 pandemic.

US tech news website The Verge said most Microsoft employees are still at home as the health crisis drags on, and the company does not expect to reopen its US offices until January of next year at the earliest.

But when it does, workers can chose to work from home permanently with their manager’s approval, although they will have to give up their office space.

“The Covid-19 pandemic has challenged all of us to think, live and work in new ways,” human resources head Kathleen Hogan said in a note to employees obtained by The Verge.

“We will offer as much flexibility as possible to support individual work styles, while balancing business needs and ensuring we live our culture.”

In a public blog post later in the day, Hogan said the company views employees spending less than 50 per cent of their time working from home as “standard”, but was not abandoning office work entirely.

“We are not committing to having every employee work from anywhere, as we believe there is value in employees being together in the workplace,” Hogan wrote.

The Verge reported some employees will not be eligible for remote-work arrangements, such as those who work in Microsoft’s labs or train other employees. 

In its memo, the company co-founded by Bill Gates said it is possible for its workers to relocate across the United States or perhaps overseas, The Verge said.

Those that relocate may see their salaries change depending on where they go, and while the company will cover expenses for employees’ home offices, it will not cover relocation expenses.

As of the end of June, Microsoft employed 163,000 people, 96,000 of them in the US, according to a securities filing.

Some major tech firms have already allowed permanent work-from-home arrangements including Facebook, whose boss Mark Zuckerberg said half of the social network’s staff could be permanently working remotely within five to 10 years.

HAVANA — The US dollar is making a comeback as the favoured currency in communist-run Cuba as the country prepares to devalue the peso to relieve pressure on a battered economy.

Cuba has a unique system whereby two official currencies have existed side-by-side for nearly three decades, the Cuban peso and convertible peso, the CUC.

Long lines outside food stores are a common sight in Havana amid chronic shortages of basic goods, and with the government planning to call time on the CUC shopkeepers are already rejecting the currency, driving a rush to dollars for those who can get them.

"CUC not accepted" reads the sign at the entry to one Havana shop. 

The island's economy, buffeted by ever-tightening US sanctions, has been hammered by the coronavirus pandemic, which has left Cuba without much-needed foreign revenue provided by its Caribbean beach tourism.

The UN Economic Commission for Latin America forecasts gross domestic product to plummet 8.0 per cent this year.

In July, Havana opened dozens of state-run "dollar stores" in an effort to rake in foreign currency. 

The relatively well-stocked stores are a magnet for well-off Cubans and those with dollar remittances sent from US-based Cubans.

Dollar debit cards 

Customers first have to open a dollar-denominated bank account, then use a debit card to pay for the goods in the stores.

Economists warn of the creation of a two-tier economy -- for the haves who can afford to buy in dollars, and the have-nots in the normal domestic economy.

"Of the 11 million inhabitants, if one million can buy in dollars, what about the other 10? If I don't have family abroad, to send dollars home, I don't have that opportunity," said Aleskis Rodriguez, 31, as he lined up to buy coffee at a Havana market still accepting CUC.

Economy Minister Alejandro Gil denied the move would herald "economic apartheid" in Cuba. Instead, he said, it will satisfy the demands of people with the most purchasing power, and add to state coffers.

Economists like Pavel Vidal, a specialist on Cuba from Colombia's Javeriana University, have long argued that the dual-currency system is unwieldy, particularly for exporters.

 Muddled reform 

Vidal says Cuba's embrace of the dollar is an admission of failure by the authorities, a consequence of reforms that are "incomplete and well below expectations."

The long-mooted monetary reform is coming "at the worst possible moment," Vidal said. 

"Because this is monetary reform that implies a significant devaluation of the official currency against the dollar. Something that has never been done."

The government in Havana has for years maintained the CUC artificially pegged to the dollar, as a shield for the vulnerable Cuban currency.

"I spent $30.90 and look at what I bought! Some packages of juice, five packages of spaghetti and five packets of tomato puree, really nothing," said Niurka Romera, 50, outside a dollar store. 

Whatever the currency, one thing is a constant in Cuban life: the long lines outside shops. 

"I've been here since 5.15 in the morning. It's 11.30 now, but they're already closing the shop and I have to come back tomorrow to buy my coffee," said Magalis, a 52-year-old teacher.

She said the government was not doing enough to limit the size of the lines during the pandemic. 

"If Commander Fidel Castro was still alive, he would have done something beautiful for the people."

SEOUL — Samsung Electronics flagged a leap of nearly 60 per cent in third-quarter operating profits Thursday, as its mobile and chip business were boosted by US sanctions against its Chinese rival Huawei.

The South Korean tech giant said in an earnings estimate that it expected operating profit to reach 12.3 trillion won ($10.6 billion) for July to September, up from 7.8 trillion won in the same period last year.

The prediction would represent the firm's biggest operating profit of any quarter for two years and was also ahead of analyst forecasts.

Samsung Electronics is crucial to South Korea's economic health. It is the flagship subsidiary of the giant Samsung group, by far the largest of the family-controlled conglomerates known as chaebols that dominate business in the world's 12th-largest economy.

Its overall turnover is equivalent to a fifth of the country's gross domestic product.

James Kang, senior analyst at Euromonitor International Korea, said Samsung's rollout of its latest premium handset devices -- the Galaxy Note 20 and the Galaxy Z Fold 2 -- in August, coupled with strong sales of mid-range phones, led the firm's third-quarter performance.

A Washington ban on foreign companies providing Huawei with US-origin technology, that came into effect on September 15 -- cutting off essential supplies of semiconductors and software needed for making smartphones and 5G equipment -- also provided a boost.

Kang Min-soo, an analyst at Counterpoint Research, said US sanctions against Huawei were becoming "a big factor" affecting the global smartphone market.

"For Samsung, it will be a good opportunity to increase market share in Europe, where it has been competing with Huawei in various price bands," he added.

The firm's memory business also benefited from the feud after Huawei rushed to stock up on Samsung-made semiconductors before the US restrictions kicked in.

"Huawei has stocked about six months' worth of extra inventory before the US ban took effect on September 15," MS Hwang, an analyst at Samsung Securities, told Bloomberg News.

"Huawei's purchases are offsetting weakness in server-use demand and are devouring market inventory, which should affect prices down the road."

'New lows' 

But analysts said falling chip prices could put a damper on Samsung's performance in the final quarter of the year.

Samsung is the world's biggest manufacturer of memory chips and led the DRAM market with a 43.5-per cent share in April-June, according to market researcher TrendForce.

Server DRAM chips enjoyed a boost as the pandemic prompted working from home and online classes -- but were now experiencing "significant oversupply", it said in a report.

"Therefore, contract prices of server DRAM products continue to descend to new lows," it went on, forecasting a 13-18 per cent drop in the fourth quarter.

Despite the optimistic forecast, Samsung Electronics shares closed down 0.3 per cent on Thursday.

Shares in LG Electronics, South Korea's second-largest appliance firm after Samsung, also closed lower Thursday, down 2.9 per cent, despite forecasting third-quarter operating profits would jump 22.7 per cent on-year to 959 billion won, a record for any quarter.

Samsung withholds net profit and sector-by-sector business performance data until it releases its final earnings report, expected later this month.

Adding to the company's challenges, vice-chairman and de facto leader Lee Jae-yong is being retried over a sprawling corruption scandal that could see him return to prison. 

He is not being held in custody during the proceedings, but a guilty verdict could deprive the firm of its top decision-maker.

WASHINGTON — A House of Representatives panel in a report on Tuesday accused four Big Tech firms of acting as "monopolies", calling for sweeping changes to antitrust laws and enforcement that could potentially lead to breakups of the giant firms.

But the report by the House Judiciary Committee failed to win the endorsement of Republican members, highlighting a partisan divide despite widespread criticism of the tech giants.

The 449-page document concluded that Amazon, Apple, Facebook and Google "engage in a form of their own private quasi regulation that is unaccountable to anyone but themselves".

"Companies that once were scrappy, underdog startups that challenged the status quo have become the kinds of monopolies we last saw in the era of oil barons and railroad tycoons," the report said.

The report follows an investigation of more than 15 months and hearings this year with the top executives of the four firms, in parallel to antitrust probes being led by federal and state enforcers.

Judiciary Committee chairman Jerrold Nadler and antitrust subcommittee chairman David Cicilline said in a joint statement that the tech firms "each possess significant market power over large swaths of our economy" and have "exploited their power of the marketplace in anticompetitive ways".

The report suggests moves which could lead to breakups of the big firms, calling for "structural separations" to prohibit companies from competing on platforms they operate.

Also recommended was a requirement that platforms allow "interoperability" with competitors and regulations aimed at preventing acquisitions that hurt competition.

Amazon pushed back in a blog post, arguing that "the presumption that success can only be the result of anti-competitive behavior is simply wrong".

"Amazon accounts for less than 1 per cent of the $25 trillion global retail market and less than 4 per cent of retail in the US. Unlike industries that are winner-take-all, retail has ample space for many winners," the e-commerce giant said.

The report's findings reflect a growing backlash against the firms, which have extended their market dominance even during the coronavirus pandemic.

But while Democrats have assailed the growing power of tech platforms, Republicans have decried what they consider bias by the Silicon Valley firms against conservatives.

Highlighting the partisan divide on tech regulation, Republican panel members declined to endorse the committee's findings this week.

"Big Tech is out to get conservatives," Representative Jim Jordan said as the report was issued.

"Unfortunately the Democrats' partisan report ignores this fundamental problem and instead advances radical proposals that would refashion antitrust law in the vision of the far left."

Matt Schruers of the Computer & Communications Industry Association, a trade group which includes some of the large tech firms, said the lawmakers had failed to understand the digital economy.

"If the goal is simply to knock down successful US businesses, then perhaps this plan would score a hit," he said.

"But if the goal is to benefit consumers, which has until now been the standard for antitrust policy, it is hard to see how this would do anything but invite regulators to micromanage business models."

LONDON — Stock markets gained ground on Tuesday while investors mulled the level of US electoral uncertainty after President Donald Trump returned to the White House following treatment for COVID-19.

As Trump was discharged from hospital, political concerns persisted ahead of the presidential election on November 3.

Tokyo stocks opened higher, extending Wall Street rallies.

The benchmark Nikkei 225 index was up 0.44 per cent or 103.36 points at 23,415.50 in early trade, while the broader Topix index advanced 0.43 per cent or 6.99 points to 1,644.24.

Japanese shares are supported by a "receding sense of uncertainty with the news of President Trump's discharge from hospital, and expectations for additional US economic stimulus", Mizuho Securities said in a commentary.

As for oil prices, they shot higher amid strikes on Norwegian offshore platforms and a hurricane heading towards US installations.

In afternoon exchanges, the FTSE 100 index was 0.2 per cent higher in London, while the Dow Jones index had gained the same in early New York trades.

Global equities had rebounded on Monday on reports of Trump's improving health, and as US lawmakers appeared to edge towards agreeing on a new stimulus package.

The election was still a big question mark, however.

"This is still going to be a controversial, drawn-out election with the potential added uncertainty of a challenge to the result," according to OANDA analyst Craig Erlam.

Investors were also unclear over the chances of a new US stimulus package that would help counteract fallout from the pandemic in the world's biggest economy, dealers said.

Analysts said Trump's positive test for COVID-19 could be the jolt US lawmakers needed to finally agree a deal.

Stimulus talks have revived with a series of mostly phone meetings between Treasury Secretary Steven Mnuchin and Democrat House leader Nancy Pelosi.

"As far as traders are concerned, talking is preferable to being in a stand-off and not engaging with each other", noted David Madden, analyst at CMC Markets UK.