“If they don’t comply with the U.S., they’re in trouble with the U.S., but if they don’t comply with China, they could also face penalties in China,” he said.

Of course, collecting fines from companies that are unwilling to pay and monitoring whether businesses comply with the rules could be difficult, Mr. Chorzempa added. “It’s already proving difficult to monitor the things that are already controlled, and if you expand that list, that’s going to be a real challenge to verify what’s going to Russia,” he said.

The Biden administration’s export controls apply to goods produced in any country as long as they use U.S. technology — including chip makers like Taiwan Semiconductor Manufacturing Company and the Shanghai-based Semiconductor Manufacturing Industry Corporation.

Both of those companies continue to rely on the United States for certain components and manufacturing technology, said Gabriel Wildau, a managing director at Teneo, a consulting firm. If they continue supplying to Russia, SMIC and other Chinese companies could be cut off from U.S. technology, the same kind of penalty that crippled Huawei.

“If Beijing is viewed as Moscow’s enabler, pressure will rise in the U.S. Congress to extend these restrictions,” Mr. Wildau wrote in a note to clients. Beijing would also face the risk that other major technology exporters, like Japan, South Korea and the Netherlands, “would adopt Washington’s tougher line,” he said.

China’s state-owned banks could also face risks for continuing to lend to Russia. China and Russia have been settling more of their trade using the renminbi and the ruble. Beijing has also been trying to develop the digital use of its currency as an alternative to the dollar, which could help Russia limit the effect of financial sanctions.

But Chinese banks are still deeply reliant on the U.S. dollar. While major Chinese banks already appeared to be pulling back their financing for Russia, Mr. Wildau said, Beijing could choose to support Russia using smaller state-owned banks that don’t do a lot of international business that requires the use of the dollar.

Article source: https://www.nytimes.com/2022/02/26/business/china-russia-ukraine.html

At least one prominent Starbucks investor echoed that concern, arguing that the company appeared to be wasting money in its efforts to resist the union. “The company is devoting quite a bit of time and money to putting forward these arguments in front of the N.L.R.B.,” said Jonas Kron, the chief advocacy officer of Trillium Asset Management, which makes investments to further environmental, social and governance goals and had a roughly $43 million stake in Starbucks at the end of last year. “It doesn’t feel like they’re using investor resources — stakeholder resources — that well.”

Mr. Kron and Trillium have urged the company to take a neutral stand toward the union. Other labor experts suggested it may eventually be forced to do so whether it wants to or not.

“I’m sure there will be a tipping point at some point,” said Amy Zdravecky, a management-side lawyer at Barnes Thornburg. “How many losses do you have before you change strategy?”

Ms. Zdravecky added that the union’s ability to win an election in a state not normally sympathetic to organized labor suggested that the campaign had staying power, and that one risk for Starbucks’s approach to opposing the union is that it could begin to alienate the company’s liberal-leaning customer base.

“Fighting unions may not align with where they want to be elsewhere,” she said.

Many of the issues that workers in Mesa cited in their decision to support the union were similar to those identified by workers in Buffalo, like staffing and Covid-19 safety. Liz Alanna, a shift supervisor at the store, said that customers sometimes waited 45 minutes last fall after submitting a mobile order because there were not enough baristas to handle the volume. “The lobby would be full of people waiting,” Ms. Alanna said.

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The Mesa campaign had an additional subplot that raised the stakes for workers. In early October, the store’s manager, Brittany Harrison, was found to have leukemia. The company initially appeared to rally behind her, Ms. Harrison said in an interview, but its posture later changed.

“I’d reach out to the district manager and it would go to voice mail or ring forever and she wouldn’t call back,” she said. Ms. Harrison, and other workers like Ms. Alanna, said that she repeatedly sought an assistant manager to help at the store but that none was forthcoming.

Article source: https://www.nytimes.com/2022/02/25/business/economy/starbucks-union-vote-mesa-arizona.html

The Afghan central bank, known as Da Afghanistan Bank or D.A.B., is among the governing institutions that will face fewer obstacles under the measure. The central bank had formerly propped up the value of the Afghan currency by regularly auctioning United States dollars.

That activity has ceased, and the value of the Afghan currency has plunged — making food too expensive for many poor Afghans to buy. At the same time, a currency shortage has led to limits on how much those Afghans who have bank accounts may withdraw from them.

Many officials from the bank fled in August, and the Taliban has installed its own leaders to oversee it. But in the briefing, a senior administration official said the U.S. government had been exploring ideas for restarting some normal central bank activities if the bank can be made truly independent, with controls to prevent money laundering and third-party monitoring. The official said much of whether that could be done was in the hands of the Taliban.

The notion of potentially trying to resuscitate Afghanistan’s central bank is in some tension with a move this month by the Biden administration regarding about $7 billion the central bank has deposited at the Federal Reserve Bank of New York, money whose fate has been a major focus since the Taliban takeover.

When the government of Afghanistan dissolved, the New York Fed made those funds unavailable for withdrawal. The Taliban have since claimed a right to them, while relatives of people killed in the Sept. 11 attacks are trying to seize the funds to pay off the Taliban’s default judgment debts to them from lawsuits they had brought against the Taliban, Al Qaeda and others.

On Feb. 11, the Biden administration moved to split those funds in half — in a way that would potentially leave the Afghan central bank decapitalized. Mr. Biden invoked emergency powers to try to move $3.5 billion into a fund that will be used for the benefit of the Afghan people. The administration left the remaining money for the Sept. 11 plaintiffs to continue pursuing in court.

It will be up to a judge to decide whether those funds can be lawfully used to pay off the Taliban’s judgment debts, a question that raises several thorny and unresolved legal issues.

Article source: https://www.nytimes.com/2022/02/25/us/politics/us-sanctions-afghanistan.html

President Volodymyr Zelensky of Ukraine was scathing in a statement posted on Facebook on Friday.

“This morning, we are defending our state alone,” he said. “Like yesterday, the world’s most powerful forces are watching from afar. Did yesterday’s sanctions convince Russia? We hear in our sky and see on our earth this was not enough.”

Ursula von der Leyen, the president of the European Commission, which carried out the painstaking technical work behind the sanctions, said on Friday that the penalties would hit the Russian economy’s ability to function by starving it of important technology and access to finance.

Its most ambitious elements were also the most technical: The European Union will ban the export of aircraft and spare parts that are necessary for the maintenance of Russian fleets. Ms. von der Leyen said that three-quarters of the aircraft in the Russian aviation fleet were made in the European Union, the United States or Canada, and that the new restrictions effectively meant many planes would soon be grounded.

The bloc will also ban the export of specialized oil-refining technology as well as semiconductors, and it will penalize more banks — although it will stop short of targeting VTB, Russia’s second-largest bank, which has already been hit with American and British sanctions, according to a draft describing the penalties seen by The New York Times.

And the European Union will target Russian elites by cutting diplomatic and service passport holders’ access to E.U. visas, and by limiting the ability of Russian nationals to make deposits of more than 100,000 euros (about $113,000) into European bank accounts.

The way Europe’s sanctions against Russia are shaping up highlights that some E.U. countries, most prominent among them Germany and Italy, prefer an incremental approach to penalizing Mr. Putin, in part to protect a fragile post-pandemic economic recovery in Europe.

On the other side are countries neighboring Russia and Ukraine, like Poland, Estonia, Latvia and Lithuania, as well as the European Union’s Nordic members and the Netherlands. They would prefer not to break up the sanctions into smaller packages but rather to hit Mr. Putin with overwhelming economic measures that truly sting.

Article source: https://www.nytimes.com/2022/02/25/us/politics/sanctions-on-russia-putin.html

“This has the potential to upend global trade flows, further fuel inflation, and create even more geopolitical tensions around the world,” she said.

After years of mismanaging their water supplies and agricultural industries, countries like Egypt, Algeria, Tunisia and Morocco cannot afford to feed their own populations without importing food — and heavily subsidizing it. In recent years, the number of undernourished people in the Arab world has increased because of the overreliance on food imports, as well as a scarcity of arable land and rapid population growth.

Beyond its effect on the price of bread, the uncertainty and turmoil brought on by the war will push up interest rates and lower access to credit, which, in turn, would quickly force governments to spend more to service their high debts and squeeze essential spending on health care, education, wages and public investments, said Ishac Diwan, an economist specializing in the Arab world at Paris Sciences et Lettres university.

He predicted a rise in economic pressure on Egypt, Tunisia, Jordan and Morocco, warning that Egypt and Tunisia in particular could see peril to their banking sectors, which hold a large share of the public debt.

Egypt is also heavily dependent on tourism from Russia, which has helped its tourism industry recover from the Covid-19 pandemic, giving the country extra cause for alarm.

Global inflation and supply chain issues stemming from the pandemic have also raised the price of pasta in Egypt by a third over the last month. Cooking oil was up. Meat was up. Nearly everything was up.

But most important, bread, the cost of which had already risen by about 50 percent at non-subsidized bakeries over the last four months; a five-pound note (about 30 cents) now buys only about seven loaves of bread, down from 10, bakery employees said.

Article source: https://www.nytimes.com/2022/02/25/world/middleeast/in-north-africa-ukraine-war-strains-economies-weakened-by-pandemic.html

Brent crude oil, the global benchmark, rose as much as 6 percent to more than $100 per barrel on Thursday after Russia invaded Ukraine and could climb further as Russia reacts to sanctions from the United States and Europe, before moderating somewhat. Russia is a major exporter of energy to Europe.

“Potentially, Russia could retaliate by limiting oil exports,” Patrick De Haan, head of petroleum analysis at GasBuddy, said on Thursday. Prices at the pump are likely to reflect repercussions from the conflict almost immediately, he said.

Some economists have noted an uncomfortable precedent when it comes to a gas shock.

Rising energy prices in the 1970s helped exacerbate inflation, causing rapid price increases to become a lasting feature of the economy, one that faded only after a painful response from the Fed. The central bank pushed interest rates — and unemployment — to double digits to bring price increases to heel during what is now known as the Great Inflation.

That episode happened after years of quick price increases that the Fed had proved slow to tamp down. This time, the central bank is gearing up to pull back support promptly.

The Fed is expected to initiate a series of rate increases in March, policy moves that should slow down lending and spending, which could translate into weaker hiring, more subdued economic growth and more modest price gains.

“The Ukrainian situation does not alter, likely, the fundamental conclusion that it’s time to change monetary policy,” said Julia Coronado, founder of MacroPolicy Perspectives. “They’re not going to just shelve all the interest rate increases because there is a war in Ukraine.”

Christopher Waller, a Fed governor, said during a speech on Thursday evening that the conflict could contribute to uncertainty, but that for now, the Fed should promptly pull back its support for the economy to try to control “alarmingly” high inflation.

Article source: https://www.nytimes.com/2022/02/25/business/economy/inflation-pce-index.html

In a survey conducted this month for The New York Times by the online research firm Momentive, however, only 16 percent of respondents said they had more in savings than before the pandemic, and 50 percent said they had less. Among lower-income households, just 9 percent said they had more in savings, and 64 percent said they had less.

The government measures the total savings of all households, which can be skewed by a relative handful of rich people. And it uses a broader definition of “saving” than most laypeople probably do — paying down debt, for example, is considered “saving” in official government statistics.

But those factors can’t fully explain the disconnect. According to anonymous banking records reviewed by researchers at the JPMorgan Chase Institute, for example, median checking account balances remained significantly above their prepandemic level at the end of December, though they have fallen since their peak last spring. And while high-income households had far more money in their accounts on average, low-income households had experienced a bigger jump in savings on a percentage basis.

“We’re still seeing this picture that cash balances are still elevated in general, and they’re elevated more so for low-income families,” said Fiona Greig, co-president of the institute.

Dr. Greig said it was possible that balances had shrunk further since December, when monthly child tax credit payments ended. Brianna Richardson, a research scientist at Momentive, said it was also possible that survey respondents were misremembering how much money they had before the pandemic, perhaps because their savings grew so much earlier in the crisis. Inflation could also be affecting people’s assessments, because the same dollar amount in savings won’t go as far as prices rise.

Article source: https://www.nytimes.com/2022/02/25/business/economy/economy-savings-rate.html

Still, sanctions experts said that SWIFT was often overhyped as a tool and that cutting access could actually backfire by forcing Russia to find alternate ways to participate in the global economy, including forging stronger ties with China or developing a digital currency.

Emily Kilcrease, a senior fellow at the Center for a New American Security, argued that such an action could accelerate Russia’s efforts to expand the use of its own financial messaging service and drive it closer to China.

“There’s also this longer term question about whether de-SWIFTing in and of itself is just creating a lot of bad incentives for Russia,” Ms. Kilcrease said.

Michael Parker, counsel at the law firm Ferrari Associates, suggested that blocking Russia from SWIFT would probably open the door to other workarounds, including finding alternative communications systems. A more effective first step, he said, would be to impose the type of bank sanctions Mr. Biden announced on Thursday.

“To actually cut Russia off from the U.S. banking system or the global banking system, the Russian banks would have to be sanctioned. And that’s what they did,” he said. “At the end of the day, this is a financial tool — hitting their major banks is about as far as we probably could reasonably go as far as a first line of sanctioning.”

Emily Flitter contributed reporting.

Article source: https://www.nytimes.com/2022/02/24/business/russia-swift-financial-system.html

Still, sanctions experts said that SWIFT was often overhyped as a tool and that cutting access could actually backfire by forcing Russia to find alternate ways to participate in the global economy, including forging stronger ties with China or developing a digital currency.

Emily Kilcrease, a senior fellow at the Center for a New American Security, argued that such an action could accelerate Russia’s efforts to expand the use of its own financial messaging service and drive it closer to China.

“There’s also this longer term question about whether de-SWIFTing in and of itself is just creating a lot of bad incentives for Russia,” Ms. Kilcrease said.

Michael Parker, counsel at the law firm Ferrari Associates, suggested that blocking Russia from SWIFT would probably open the door to other workarounds, including finding alternative communications systems. A more effective first step, he said, would be to impose the type of bank sanctions Mr. Biden announced on Thursday.

“To actually cut Russia off from the U.S. banking system or the global banking system, the Russian banks would have to be sanctioned. And that’s what they did,” he said. “At the end of the day, this is a financial tool — hitting their major banks is about as far as we probably could reasonably go as far as a first line of sanctioning.”

Emily Flitter contributed reporting.

Article source: https://www.nytimes.com/2022/02/24/business/russia-swift-financial-system.html

“That’s really going to be the test: Does Fortress Russia hold up when you have assets that may be frozen overseas?” said Daniel Tannebaum, a partner at Oliver Wyman who advises banks on sanctions.

For now, U.S. and European officials are not ready to cut off all Russian banks from Swift, the Belgian money transfer system used by more than 11,000 financial institutions worldwide. But a senior Biden administration official told reporters on Thursday that such an action was not off the table. In Europe, governments differ on whether to untether Russia from Swift.

U.S. officials for now do not plan big disruptions to Russia’s energy exports, which are the pillar of the country’s economy. Europe relies on the products, and world leaders do not want to drive oil and gas prices higher, though Germany did halt the Nord Stream 2 gas pipeline project this week.

European Union leaders met in Brussels on Thursday evening and pored over the details of proposed sanctions, which they insisted would deliver a heavy blow to the Russian economy.

But documents seen by The New York Times indicated that the bloc, which has close financial ties to Russia and shares borders with Ukraine, would probably defer several difficult decisions, despite pleas from Poland, the Netherlands and the Baltic States to take a hard-line approach.

“Enough of this cheap talking,” said Prime Minister Mateusz Morawiecki of Poland, which has already received Ukrainians fleeing the war. He added: “We are buying as Europe, as the European Union, lots of Russian gas, lots of Russian oil. And President Putin is taking the money from us, Europeans. And he’s turning this into aggression.”

Reporting was contributed by Matina Stevis-Gridneff from Brussels, Alan Rappeport from Washington, Motoko Rich from Tokyo and Yan Zhuang from Melbourne, Australia.

Article source: https://www.nytimes.com/2022/02/24/us/politics/biden-sanctions-russia-ukraine.html