For starters, let’s mention the ongoing semiconductor chip shortage. General Motors (GM) says it has to cut production of its Chevrolet Bolt at six North American assembly plants through mid-October.

Of course, it doesn’t help there have been multiple reports of battery issues – including 12 fires reported and three injuries. The stock didn’t seem to suffer much on the news. But its profits will. That’s inevitable.

Meanwhile, there’s drama developing around the world in major financial institutions, including the World Bank. Leaders such as former Chief Executive Kristaline Georgieva and former President Jim Yong Kim – now managing director of the International Monetary Fund – are being accused of bullying banks into boosting China’s financial ranking in 2018.

The bank’s ethics committee employed law firm WilmerHale to investigate. Its current conclusion, released Thursday, is that those individuals put “undue pressure” on staff in this regard.

It’s also known that Dallas Fed President Robert Kaplan made close to $1 million in stock trades last year. And Boston Fed President Eric Rosengren bought and sold a significant amount as well – including transactions involving real estate investment trusts (REITs), of all things.

Neither individual violated the Fed’s policies, but neither set of news has been well-received. As a result, the Fed released this statement:

"Because the trust of the American people is essential for the Federal Reserve to effectively carry out our important mission, Chair Powell late last week directed board staff to take a fresh and comprehensive look at the ethics rules around permissible financial holdings and activities by senior Fed officials. This review will assist in identifying ways to further tighten those rules and standards. The board will make changes, as appropriate, and any changes will be added to the Reserve Bank Code of Conduct."

You have to love transparency.

The World According to REITs

Moving on to a different topic, we’ve got some REIT announcements to make, three of which are listed below, as usual. Another three of them are featured at Intelligent REIT Daily. In other words, for those who want to be more involved, there are definitely avenues to explore.

1. Pebblebrook Hotel Trust (PEB) updated investors on its operating trends. On the one hand, they “improved weekly through early August.” On the other, “recent weeks reflect both a slowdown in overall demand due to seasonal factors as well as a negative impact to the pace of the business travel recovery due to… the Delta variant.” Corporate demand in particular rose in July but fell in August. And, “so far, the company has seen roughly 10%-20% of corporate groups cancel for September and October, with many rebooking for late 2021 or 2022.”
2. CoreCivic (CXW) says it received notice about its West Tennessee Detention Facility in Mason. The contract it has with the U.S. Marshals service ends on Sept. 30 and apparently will not be renewed. All inmates will be transferred by that date.
3. RLJ Lodging Trust (RLJ) amended its corporate credit facilities. They now feature a pre-approved, one-year extension option for about $225 million of the $319 million team loans that mature in January 2023. This allows it better access to acquisitions through its balance sheet.

Clearly then, lodging REITs are on the rise, but not out of the woods yet. Except, that is, when it comes to Ashford Hospitality Trust (AHT). It just can’t seem to catch a break at all.

Source: The Daily REITBeat