America’s funding needs are starting to grow at a dangerous pace.
Even before the NYT reported of Trump’s startling suggestion of a further $100 billion tax cut in the form of an inflation-adjusted capital gains tax cost basis which mostly benefits the wealthy, earlier today the U.S. Treasury said it expects to borrow $56 billion more during the third quarter than previously estimated, while market participants expect shorter-dated Treasuries to absorb the brunt of the new supply as the Trump administration grapples with a mushrooming budget deficit. In the Treasury’s latest quarterly Sources and Uses table, it revealed thatit expects to issue $329 billion in net marketable debt from July through September, and $56 billion more than the $273 billion estimated three months ago, in April. assuming an end-of-September cash balance of $350 billion, matching its previous estimate. It also forecast $440 billion of borrowing in the final three months of the year, with a $390 billion cash balance on December 31. The borrowing estimate for the third quarter is the highest since the same period in 2010 and the fourth largest on record for the July-September quarter, according to Reuters. In the second quarter, net borrowing totaled $72 billion, slightly below the earlier prediction of $75 billion.
The US fiscal picture continues to darken as a result of rising social security costs, military spending and debt service expenses while corporate tax income is declining after last year’s tax reforms. As a result, the federal budget deficit is expected to reach $833 billion this year, up from $666 billion in the budget year ended last September, a number that is well below the net funding demands for the US Treasury.
The new projections put total net borrowing at $769 billion for the second half of 2018 and a whopping $1.33 trillion for the whole year. The federal budget deficit totaled $607 billion through the first nine months of the fiscal year that ends Sept. 30, up 16% compared with $523 billion from the same period a year earlier. In late June, the CBO forecast that total government spending would exceed revenue by $1 trillion in 2020. That would suggest that the net financing need of the US in two years could be as high as $1.5 trillion. “Because of surprising declines in corporate tax revenues, the federal deficit is constantly under discussion this month,” FTN rates strategist Jim Vogel told Reuters. Adding to the supply of bonds hitting the market, the Fed is also trimming its vast holdings of Treasury debt as part of Quantitative Tightening, with some $40BN in monthly reductions in the third quarter.
WASHINGTON (Reuters) – U.S. consumer spending increased solidly in June as households spent more at restaurants and on accommodation, building a strong base for the economy heading into the third quarter, while inflation rose moderately. Other data on Tuesday showed employers boosting benefits for workers in the second quarter, but wage growth slowed down. With savings at lofty levels and lower taxes increasing take-home pay for some workers, spending is likely to remain strong this year. Accelerating home prices, which are boosting wealth for some households, should also underpin consumption. Strong economic growth and steadily rising inflation are likely to allow the Federal Reserve to continue gradually raising interest rates. Fed officials started a two-day meeting on Tuesday. “More spending on ‘wants,’ not ‘needs,’ is always a good sign of consumer confidence,” said Jennifer Lee, a senior economist at BMO Capital Markets in Toronto. “As long as incomes continue to rise and job creation remains strong, consumer spending should remain solid over the remainder of the year.” The Commerce Department said consumer spending, which accounts for more than two-thirds of U.S. economic activity, rose 0.4 percent last month. Data for May was revised up to show consumer spending advancing 0.5 percent instead of the previously reported 0.2 percent gain. Last month’s increase in consumer spending was in line with economists’ expectations. The data was included in last Friday’s second-quarter gross domestic product report, which showed consumer spending accelerating at a 4.0 percent annualized rate during that period after a pedestrian 0.5 percent pace in the first quarter. The economy grew at a 4.1 percent rate in the second quarter, almost double the January-March period’s 2.2 percent pace and the strongest performance in nearly four years. June’s increase in consumer spending sets it on a higher growth path heading into the third quarter. Consumer spending last month was boosted by spending at restaurants and on accommodation. Spending on services accelerated 0.6 percent after rising 0.3 percent in May. Outlays on goods were unchanged after surging 0.9 percent in May. Prices continued to steadily rise last month. The personal consumption expenditures (PCE) price index excluding the volatile food and energy components gained 0.1 percent in June. It had risen by 0.2 percent in the prior month.
That kept the year-on-year increase in the so-called core PCE price index at 1.9 percent for a third straight month.
The core PCE index is the Fed’s preferred inflation measure. The core PCE hit the U.S. central bank’s 2 percent inflation target in March for the first time since December 2011. The Fed is expected leave interest rates unchanged on Wednesday after increasing borrowing costs in June for the second time this year. It has forecast two more rate hikes by December. “For the Fed, there’s nothing to be alarmed about in this morning’s data,” said Chris Low, chief economist at FTN Financial in New York. “Consumers are behaving and inflation is stable.” The dollar firmed marginally against a basket of currencies. Prices for longer-dated U.S. Treasuries rose and stocks on Wall Street were trading higher.Spending in June was supported by a 0.4 percent increase in personal income, which matched May’s increase. Savings edged up to $1.050 trillion last month from $1.047 trillion in May. In a separate report on Tuesday, the Labor Department said its Employment Cost Index, the broadest measure of labor costs, rose 0.6 percent after an unrevised 0.8 percent advance in the first quarter. That pushed the annual increase in the ECI to 2.8 percent, the biggest gain since the third quarter of 2008, from 2.7 percent in the first quarter. Wages and salaries, which account for 70 percent of employment costs, rose 0.5 percent in the second quarter, retreating from a 0.9 percent surge in the January-March period. Wages and salaries were up 2.8 percent in the 12 months through June, also the biggest annual gain since the third quarter of 2008. “The long recovery in wages has reflected a large pool of workers on the sidelines,” said Adam Ozimek, a senior economist at Moody’s Analytics in West Chester, Pennsylvania. “One factor leaning against a return to rapid wage growth is weaker productivity.” Separately, the Conference Board said its consumer confidence index increased 0.3 point to a reading of 127.4 in July. Consumers were upbeat about the labor market. The survey’s so-called labor market differential, derived from data about respondents who think jobs are hard to get and those who think jobs are plentiful, increased to 28.1 this month from 25.3 in June. That measure closely correlates to the unemployment rate in the Labor Department’s employment report and is consistent with rapidly diminishing labor market slack. Despite their strong confidence in the economy, consumers appeared less enthusiastic about buying a home and household appliances. Still, the fundamentals for consumer spending remain strong. A fourth report on Tuesday showed the S&P/Case-Shiller 20-city composite price index rose 6.5 percent year-on-year in May after increasing 6.7 percent in April.
A floorhand works on an oil rig in the Bakken shale formation outside Watford City, North Dakota.
A handful of one-day losses has put the oil market on pace for its worst month in two years — and the source of those big swings can often be traced back to the White House. Supply and demand for oil are roughly in balance, so traders have been sensitive to any headlines that could tip the market into oversupply or shortage. Lately there has been no shortage of news, in part because of President Donald Trump’s penchant unexpected comments on Twitter, as well as his administration’s effort to impose sanctions on Iran, the world’s fifth biggest oil producer. “Welcome to a headline-driven market,” said John Kilduff, founding partner at energy hedge fund Again Capital. “It’s duck and cover and keep an eye on your Twitter feed.”
U.S. crude prices actually rose in 13 of the month’s 21 sessions, while Brent is also up in 13 of the 22 trading days. However, most of the one-day gains were moderate, with both benchmarks jumping more than $1 a barrel only once this month.
Meanwhile, Brent lost nearly $11 over three sessions spread throughout the first four weeks of July. U.S. crude lost almost $8 over as many days during the same period. A final day of losses on Tuesday is putting both futures on track for their worst monthly drop since July 2016. Heading into the month, oil prices had rallied strongly after a State Department official told reporters the Trump administration was pushing oil buyers to cut their purchases from Iran to zero by Nov. 4. Trump restored sanctions on Iran in May, but the deadline for winding down imports was more aggressive than the market had anticipated and raised fears of oil shortages. But a few days later, on July 2, Brent crude dropped nearly $2 a barrel after Trump declared on Twitter that Saudi Arabia’s king had agreed to pump up to 2 million more barrels per day to tame fuel prices. The White House later walked back that claim, saying the king would take an increase under consideration.
Just spoke to King Salman of Saudi Arabia and explained to him that, because of the turmoil & disfunction in Iran and Venezuela, I am asking that Saudi Arabia increase oil production, maybe up to 2,000,000 barrels, to make up the difference…Prices to high! He has agreed!
— Donald J. Trump (@realDonaldTrump) 30 June 2018 ” target=”_self”>TWEET
That same day, Reuters forecast that Saudi Arabia’s oil output had jumped by 700,000 bpd in June. Meanwhile, Russia’s energy minister said it had boosted its production back above 11 million bpd that month. Both headlines suggested that Saudi Arabia and Moscow were making good on their vow to raise output to prevent the market from overheating. Two days later, WTI had its first big drop for the month, falling $1.20 a barrel after weekly data showed a surprise jump in American crude stockpiles. Earlier in the day, Trump lobbed the latest in a series of Twitter critiques at OPEC, ordering the world’s cartel to reduce prices immediately. That fed speculation that Trump was getting impatient with relatively high fuel prices and considering selling oil from the nation’s emergency supply. (A week later, details of a plan to do just that leaked.)
@realDonaldTrump: The OPEC Monopoly must remember that gas prices are up & they are doing little to help. If anything, they are driving prices higher as the United States defends many of their members for very little $’s. This must be a two way street. REDUCE PRICING NOW
Brent and U.S. crude both logged their biggest daily drop for the month on July 11, after Libya resolved a major disruption to its crude exports and Saudi Arabia reported a nearly 500,000 bpd jump in its oil output. Brent fell $5.46 a barrel, while U.S. crude ended the day down $3.73. Also that day, oil prices fell in tandem with stock markets after the Trump administration slapped tariffs on $200 billion of Chinese goods. The trade dispute between the nations — home to the world’s two biggest economies — has weighed on oil markets because it threatens to slow global growth and cool demand for crude. The final big drop came the following week later on July 16, with U.S. crude down nearly $3 a barrel and Brent dropping almost $3.50. That day, Treasury Secretary Steve Mnuchin eased the market’s concerns about oversupply, saying the administration would consider allowing some oil buyers to reduce their purchases from Iran more gradually. Mnuchin told reporters the administration wanted to avoid roiling oil markets as it pursued its Iran policy. On Tuesday, U.S. crude was down more than $1 a barrel to about $69, on pace for a roughly 7 percent decline this month. Brent fell toward $74, down about 6.5 percent in July. The latest declines came as a Reuters survey of analysts forecast another jump in OPEC’s output for July and Russia said its oil production would hit a 30-year high above 11 million bpd this year. “There’s been this rush to put more oil on the market by the Saudis and Russia, so I think in the near term, it’s a negative because we haven’t lost any of the Iranian barrels yet,” Kilduff said.
WASHINGTON (Reuters) – President Donald Trump again attacked Special Counsel Robert Mueller’s probe into Russia and the 2016 U.S. election on Tuesday, reiterating that his campaign did not collude with Moscow and saying collusion is not a crime anyway. U.S. President Donald Trump speaks during a joint news conference with Italy’s Prime Minister Giuseppe Conte in the East Room of the White House in Washington, U.S., July 30, 2018. REUTERS/Carlos Barria Trump commented hours before his former campaign chairman, Paul Manafort, was due to go on trial on tax and bank fraud charges in Virginia. As the first trial in the 14-month Russia probe, the case throws a fresh spotlight on a federal criminal investigation that has dogged Trump’s presidency. Mueller is investigating whether Trump campaign officials worked with Moscow to try to sway the 2016 U.S. presidential election, something commonly referred to as collusion by the media and public officials. “Collusion is not a crime, but that doesn’t matter because there was No Collusion (except by Crooked Hillary and the Democrats)!” Trump wrote on Twitter. While collusion is not a technical legal charge, Mueller is probing any coordination between the Russian government and the Trump campaign, and could bring conspiracy charges if he finds that any campaign member worked with Russia to break U.S. law. Legal experts said that working with a foreign national with the intent of influencing a U.S. election could violate multiple laws. “Collusion is basically a partnership in crime, which is conspiracy,” said Randall Eliason, a former federal prosecutor and a law professor at George Washington University. Trump has for months denied that the campaign colluded with Russia to try to engineer his victory against Democratic candidate Hillary Clinton, and he bristles at the suggestion he might owe his White House victory to Moscow. On Tuesday, he echoed his personal lawyer, Rudy Giuliani, who said in television interviews on Monday that collusion is not a crime. The strategy may be the latest in Trump’s efforts to strip legitimacy from the Mueller probe, which he has long denounced as a “witch hunt.” Russia has denied the finding of U.S. intelligence agencies last year that it interfered to sway the election to Trump. “The reason the Trump troops are pounding the ‘collusion is not a crime’ drum is because they colluded (better known as conspiracy, or aiding and abetting) and they want to get out in front of the story to control the narrative!” John Dean, President Richard Nixon’s legal counsel, wrote on Twitter. Manafort, 69, faces 18 criminal counts, which centre on allegations that he hid much of the $60 million he earned working for a pro-Russian politician in Ukraine in undisclosed overseas bank accounts and failed to pay taxes on it.
Washington (CNN)Prosecutors from special counsel Robert Mueller’s office said Monday that Paul Manafort earned $60 million from his work as a political consultant in Ukraine and challenged a motion by the former Trump campaign chairman’s attorneys to exclude dozens of exhibits on the topic. In a filing submitted in Virginia federal court, Mueller’s team said they planned to use evidence including “memoranda, emails, and photos reflecting tasks performed” to demonstrate the “full sweep of Manafort’s Ukraine work” and that he “was paid tens of millions of dollars in income.” Manafort’s attorneys last week fingered over 50 exhibits included on a proposed government list as prejudicial and irrelevant and asked the judge to disallow them from his trial, set to begin with jury selection on Tuesday. Manafort is charged with lying on tax forms and bank fraud. He has denied all charges against him. The indictment against Manafort says $75 million flowed through offshore accounts controlled by Manafort and his former business partner Rick Gates. Prosecutors on Monday said they need to use the exhibits in question to prove that Manafort earned that much income, which they contend he failed to report on his tax returns. The exhibits also “contain evidence about the identity of Manafort’s sources of income in Ukraine, and in particular the oligarchs who instituted the practice of paying Manafort via foreign accounts,” according to the filing. Mueller’s team also argued that Manafort’s motion would “exclude virtually every exhibit containing the name of several key government witnesses, thereby preventing the jury from hearing evidence that corroborates the witness’s expected testimony and demonstrates the witness’s credibility.
Oil prices rose back above $70 a barrel on Monday, with U.S. crude posting its best one-day dollar gain in over a month, after four weeks of losses for the benchmark. U.S. West Texas Intermediate crude ended Monday’s session up $1.44, or 2.1 percent, to $70.13 a barrel. While the contract has risen in seven of the last previous 10 sessions, it has not posted a gain of more than $1 a barrel since June 27. As of Friday, WTI was down more than 7 percent over the last four weeks, as heavy losses in a handful of trading sessions wiped out a string of modest daily gains for the benchmark.
The contract to deliver international benchmark Brent crude for September was up 83 cents, or 1.1 percent, at $75.12 a barrel by 2:08 p.m. ET. The September contract expires on Tuesday. Trading was heavier for the October contract, which is up 97 cents, or 1.3 percent, at $75.73. Prices got support after Saudi Arabia announced it would suspend shipments of oil through the critical Bab el-Mandeb Strait, after Houthi rebels in Yemen attacked a pair of oil tankers in the Red Sea. The Saudis have led a military coalition against the Iran-aligned Houthis for more than three years. Risk consultancy the Eurasia Group says the attack on the tankers “represents a serious escalation in dynamics around the Yemen conflict.” “While Houthi rebels probably long possessed the capability to threaten Saudi oil shipments in the Bab-al Mandab Strait, their willingness to use it is the result of rising tensions in the region,” Ayham Kamel, head of Eurasia Group’s Middle East and North Africa practice said in a research note, using an alternative spelling for the strait. “The attack was probably encouraged by the Iranian leadership to demonstrate to the US, Saudi Arabia, and Israel that Iran and its allies retain a capacity to respond to intensifying economic, political, and military pressure.” The United States and Iran have lately engaged in a war of words, with Iranian officials threatening to snarl oil exports in the world’s busiest region for crude shipments. Tension is rising ahead of the first of two deadlines next week for international businesses to wind down ties with Iran under renewed U.S. sanctions. The situation raises concerns that the world will be short of oil. Those concerns have been amplified as Canada’s Suncor Energy works to fully restore operations at its massive Syncrude oil sands facility, where supplies have been disrupted by a power outage earlier this year. The company has scaled back its expectations for production from Syncrude this year, and there are reports the facility might not be fully operational as early as expected. “It’s just this witches’ brew of supportive factors from Iran to the Syncrude,” said John Kilduff, founding partner at energy hedge fund Again Capital. Hedge funds and money managers are getting more constructive on energy commodities. Funds increased their bullish bets in Brent, U.S. gasoline, U.S. heating oil and European gasoil in the latest week, according to a Reuters analysis. Fears that robust demand for oil will cool off have eased following a meeting between President Donald Trump and European Commission President Jean-Claude Juncker that yielded progress in a trade dispute last week.
If Michael Cohen, President Donald Trump’s former personal attorney, moves to help special counsel Robert Mueller’s probe, the president would be “one witness away from a potential catastrophe,” said MSNBC legal expert Jonathan Turley. “I think the Cohen development is very serious. He’s one witness away from a potential catastrophe. If any of those five witnesses breaks and supports Michael Cohen, this is going to get real bad, real fast,’ said Turley Monday on MSNBC’s “Morning Joe.” Turley, a George Washington University law professor, was referring to five witnesses who have been granted immunity to testify in the trial of former Trump campaign chairman Paul Manafort. The professor The Trump Tower meeting would not establish that collusion had occurred, but if Trump knew ahead of time about Donald Trump Jr. and a Kremlin-connected lawyer meeting in Trump Tower in 2016, Trump Jr. would be in “serious jeopardy of a criminal charge.” “If Mueller was to go after Donald Trump Jr., I think we would see a very rapid chain of events and it would not end well for anyone,” Turley said in the interview. “I think that Donald Trump very well could match his past visceral language with similar action. He could start to fire people, and that would have a cascading effect. It would probably take us right to the doorstep of impeachment,” Turley said.
US President Donald Trump has offered to meet Iran’s leaders with no preconditions, at any time they want. “They want to meet, I’ll meet. Any time they want,” he said at a White House news conference with Italy’s PM. The US president’s conciliatory approach comes after he and Iranian President Hassan Rouhani traded hostile warnings earlier this month. In May, the US left a deal which curbed Iran’s nuclear activities in return for the lifting of international sanctions. Washington is preparing to re-impose sanctions on Tehran within days – despite objections from the UK, France, China, Russia and Germany, who all signed the 2015 agreement. The US is deeply suspicious of Iranian activity in the Middle East and is an ally of Israel and Saudi Arabia, two of Iran’s foes. “I’d meet with anybody. I believe in meetings,” Mr Trump added, speaking alongside Italy’s Giuseppe Conte. Last week Mr Trump responded angrily to Mr Rouhani, who had earlier warned of the consequences of a conflict with his country. Mr Trump tweeted in capitals that Iran would “suffer consequences the likes of which few throughout history have ever suffered before” if it threatened the US. Mr Rouhani had told Iranian diplomats: “America should know that peace with Iran is the mother of all peace, and war with Iran is the mother of all wars.” His remarks were reported by Iran’s state news agency Irna.
To Iranian President Rouhani: NEVER, EVER THREATEN THE UNITED STATES AGAIN OR YOU WILL SUFFER CONSEQUENCES THE LIKES OF WHICH FEW THROUGHOUT HISTORY HAVE EVER SUFFERED BEFORE. WE ARE NO LONGER A COUNTRY THAT WILL STAND FOR YOUR DEMENTED WORDS OF VIOLENCE & DEATH. BE CAUTIOUS!
— Donald J. Trump (@realDonaldTrump) July 23, 2018
Responding to Mr Trump’s broadside, Iranian Foreign Minister Javad Zarif tweeted: “Color us unimpressed.”
COLOR US UNIMPRESSED: The world heard even harsher bluster a few months ago. And Iranians have heard them —albeit more civilized ones—for 40 yrs. We’ve been around for millennia & seen fall of empires, incl our own, which lasted more than the life of some countries. BE CAUTIOUS!
President Donald Trump’s attorney, Rudolph Giuliani, asserted Monday that “collusion is not a crime,” and declared that the president is “absolutely innocent.” “I have been sitting here looking in the federal code trying to find collusion as a crime,” Giuliani said in an interview on Fox News Channel’s “Fox & Friends.” “Collusion is not a crime.” Trump has repeatedly denied there was collusion between his campaign and Russia during the 2016 U.S. presidential election. As recently as Sunday, the president took to Twitter to repeat the claim. “There is No Collusion!” Trump wrote, referring to special counsel Robert Mueller’s investigation into Russia’s attack on the election. Giuliani expanded on his remarks in an interview with CNN. “The hacking is the crime,” Giuliani told the network. “The president didn’t hack.” Following the interview on CNN, Giuliani responded to a post on Twitter that suggested the media was “nitpicking and twisting” his comments. Giuliani called the post an “excellent observation.” “You can investigate an innocent person forever and forever and find nothing. When do we say enough is enough. No collusion, no obstruction. President Trump did nothing wrong,” Giuliani wrote in response. Giuliani addressed reports that Michael Cohen, the president’s former lawyer and fixer, was prepared to tell Mueller that Trump knew about a June 2016 meeting in Trump Tower between the president’s senior campaign staff, including his eldest son Donald Trump Jr. and then-campaign chief Paul Manafort, and a Russian lawyer who was allegedly offering dirt on Democratic presidential candidate Hillary Clinton. “This Russia meeting, I’m happy to tell them, he wasn’t there,” Giuliani said.
Before Giuliani’s interviews Monday, the intrigue about the meeting centered on whether the elder Trump knew the meeting was going to happen. The president has previously denied foreknowledge of the gathering. “I did NOT know of the meeting with my son, Don jr. Sounds to me like someone is trying to make up stories in order to get himself out of an unrelated jam,” the president wrote in a post on Twitter on Friday. The special counsel has homed in on the Trump Tower meeting, and has sought to ask Trump about how involved he was in its planning. The meeting figured in a list of questions the special counsel prepared to ask the president. Among the questions, published by The New York Times in April, was an inquiry about when the president first became aware of the June 9 meeting.
The Russian government, previously considered a “major” holder of U.S. debt, has been steadily — and sharply — paring down the vast majority of its holdings of U.S. Treasury securities. Russian holdings of Treasury securities declined 84 percent between March and May, falling to $14.9 billion from $96.1 billion in just two months, according to a U.S. Treasury Department report released July 18. Moscow’s ownership of U.S. debt is eclipsed by that of China and Japan, both of whom actively manage their currencies and hold more than $1 trillion each in Treasuries on their books. In fact, China’s vast holdings have been cited by some observers as a “nuclear option” in a Sino-American trade war, with the world’s largest economy seen vulnerable to Chinese selling that could drive up yields. However, Russia’s moves in the market come amid a growing furor over Moscow’s suspected meddling in the U.S. general election in 2016, which has led to sanctions on its economy. Russia’s sell-off of U.S. debt in May also coincided with the benchmark 10-year Treasury note yield, which moves inversely to the note’s price, briefly touching its highest level since 2011. Though the 10-year yield has since retreated from levels above 3 percent, its movements have implications for other financial instruments like mortgages rates and auto loans, which are often based on its rate. The yield on the 10-year Treasury note has subsequently stabilized, trading at 2.958 percent. Bond experts like Raymond James’s Kevin Giddis pointed to a flood of Treasury supply for higher long-term rates back in May. However, most of the excess likely came from historically large Treasury auctions to help pay for Washington’s new tax cuts and spending bill, not Moscow’s selling. “While this liquidation by the Russians is curious, the amount they held, along with the amount they sold, is really insignificant to the multi-trillion dollar Treasury market,” Giddis, head of fixed income capital markets at Raymond James, said on Sunday. “If I had to wager, I would bet that this is part sanctions and part portfolio adjustment and little to do with a real market move,” he added. “If this was China or Japan, then the story would be quite different, and so the muted market movement, or lack thereof, pretty much tells the story of the move.” Major foreign holders of U.S. debt accounted for $6.21 trillion of current U.S. debt, while the total public debt outstanding is $21.3 trillion as of July 26. The United States imposed sanctions in April on Russian businessmen, companies and government officials, a direct jab at associates of Russian President Vladimir Putin in a move designed to punish the country for a variety of infractions, including alleged meddled in the 2016 U.S. election. The move freezes the U.S. assets of “oligarchs” as well as punishes non-American individuals and companies doing business with the sanctioned entities in the same they would Americans. This is a particular potent component of the sanctions, which target aluminium tycoon Oleg Deripaska and lawmaker Suleiman Kerimov, among others. The U.S. Treasury Department did not immediately respond to CNBC’s request for comment.