BuSINESS
F RIDAY, AUGUST 9, 2019::L ATIMES.COM/BUSINESS
C
DOW 2 6,378.19▲371.12 S&P 5002,938.09 54.11▲ NASDAQ8,039.16 176.33▲ GOLD$1,497.70 9.60▼ OIL$52.54 1.45▲ EURO$1.1185▼ .0029 U.S. T-NOTE(10-yr.)1.71% 0.01▼Home builders are pulling back from new construc-
tion, the opposite of what economists say is needed to
ease California’s housing affordability crisis.
In the first six months of 2019, builders gained ap-
proval for 51,178 new homes in California, nearly 20%
fewer than in the same period a year earlier. That puts
the state on track for the first meaningful annual decline
since the recession.
In the Los Angeles-Orange County metro area, total
permits — an indication of future construction — fell by
25%, according to data from the U.S. Census Bureau.
Single-family permits dropped 18.5% in the region, while
those for multifamily projects such as apartment build-
ings — a category in which activity tends to be more vola-
tile — fell 28.6%.
“We are going in exactly the wrong direction,” said
Christopher Thornberg, founding partner of Beacon
Economics.
Economists, developers and trade groups said the
slowdown in permits has a simple explanation: It’s be-
come harder to make money building homes.
Home prices and, to a lesser extent, rents have soft-
ened as Californians find it harder to stretch their dol-
lars and balk at stratospheric price points. Sales of ex-
isting and new homes have fallen, forcing some builders
to cut prices on developments already underway.
In June, sales fell 8.8%in Southern California’s six
counties. The median sale price was $541,250, up just
1.2% from a year earlier.IN THE FIRST HALF of this year, 51,178 home construction permits were approved in the state, down sharply from a year earlier.
Glenn KoenigLos Angeles TimesHousing crisis may worsen:
Home builders pull back
Drop in permits is blamed on high construction costs and declining sales
L.A. HAS loosened zoning near mass transit, but developers still face a lengthy
approval process elsewhere. Above, a Metro train in Culver City last year.
Christina HouseLos Angeles TimesBy Andrew Khouri[SeeHousing,C5]The nearly three-week
blackout of CBS stations on
AT&T television services,
including DirecTV and U-
Verse, ended Thursday after
the two television power-
houses reached a new car-
riage agreement.
An estimated 6.6 million
AT&T customer homes
nationwide were included in
the CBS station blackout,
including 1.4 million in the
Los Angeles region. Viewers
missed “The Late Show
With Stephen Colbert,”
“Judge Judy,” “The Young
and the Restless” and Norah
O’Donnell’s first weeks as
the new host of “CBS Eve-
ning News.”
“CBS and AT&T regret
any inconvenience to their
customers and viewers and
thank them for their pa-
tience,” the two companies
said in a joint statement.
AT&T customers in New
York, Chicago, Atlanta, Den-
ver, Sacramento and San
Francisco also were affected
by the blackout. The new
AT&T-CBS agreement in-
cludes coverage of the CBS-
owned Smithsonian Chan-
nel and the CBS Sports Net-
work.
Blackouts have become
more common in recent
years because of increas-
ingly contentious negotia-
tions over fees that
programmers charge for
their content. Media compa-
nies are paying more for pro-
gramming such as sports
while pay-TV operators face
their own financial pres-
sures as more consumers
cut the cable cord in favor of
lower-cost alternatives.
According to the Ameri-
can Television Alliance,
there have been a record 230
outages on various pay-TV
systems this year.
AT&T remains at logger-
heads with Nexstar Media
Group, one of the nation’s
largest TV station owners.
And, in late July, Dish Net-
work dropped 22 Fox-
branded regional sports net-
works, including Fox Sports
West, which broadcasts An-
gels games, and Fox Sports
San Diego, which carries Pa-
dres games. That dispute
over carriage fees also re-CBS AND
AT&T
REACH
A DEAL
Fee agreement ends
nearly three-week
blackout of network’s
stations on DirecTV
and elsewhere.
By Meg James[SeeCBS-AT&T,C4]Uber Technologies Inc.
posted disappointing quar-
terly results Thursday,
sparking a sell-off in after-
hours trading.
Its ride-hailing rival Lyft
Inc. beat analysts’ expecta-
tions the day before, but
Uber’s second-quarter ad-
justed sales fell short of esti-
mates and the company
posted a net loss of $5.24 bil-
lion.
Most of that loss was at-
tributed to stock-based
compensation associated
with the initial public offer-
ing in May, a routine expense
for newly public companies.
The adjusted loss — a more
commonly used metric for
ride-hailing companies,
which excludes interest, tax
and other expenses — morethan doubled to $656 million
but wasn’t as large as the
$979.1-million average of ana-
lyst estimates compiled by
Bloomberg.
Uber generated $2.87 bil-
lion in adjusted revenue in
the second quarter, up 12%
from a year earlier and below
the $3.05 billion that ana-
lysts had expected for the
quarter. Gross bookings, an
important number used to
track ride-hailing demand,
rose 31% to $15.76 billion.
In its filing, Uber also ac-
knowledged the creation of a
$6.1-billion Dutch tax deduc-
tion that will help the com-
pany reduce a chunk of its
global tax bill for years to
come. The deduction, which
came through an increase in
the value of intellectual
property that Uber trans-
ferred between its offshoreUber reports huge
loss, unveils Dutch
tax-cutting tactic
By Eric Newcomer[SeeUber, C4]No wonder he’s frus-
trated: President Trump’s
intensifying battle with
China and other major trad-
ing partners is turning into a
global currency war, and it
will be hard for him to win
both.
The president once again
bemoaned the dollar’s
strength Thursday, calling
in a tweetfor policymakers
to slash interest rates. Yet
the trade tensions he has
stoked have supported the
currency this year.
They’ve boosted demand
for the greenback by helping
fuel a mammoth bond rally
as investors seek out the
safest assets, particularly
Treasury issues. Foreign
ownership of U.S. govern-
ment debt has swelled to
record highs, pushing yields
to the lowest since 2016 on 10-
year notes, a benchmark for
global borrowing.
Trump has repeatedly
nagged the Federal Reserve
to cut borrowing costs while
complaining that the dollar
is too strong. If the Fed cuts
interest rates further this
year, the monetary easing
may actually shore up the
U.S. economy, supporting
the dollar. And that may
only add to Trump’s frustra-
tion. Options traders this
week increased their wagers
on a weaker yuan versus the
dollar.
“Whether President
Trump can win the trade
war and the ‘FX war’ seems
rather doubtful,” said Kit
Juckes, a global strategist at
Societe Generale in London.
“If he wants a weaker dollar,
he should want a stronger
yuan and euro. Unfortu-An unwanted result of trade war
Trump seeks a weaker
dollar, but he keeps
strengthening it by
stoking fears over his
battle with China.
By Anchalee
Worrachate
PRESIDENT TRUMP’Slatest threat of more tariffs
on Chinese goods helped push the yuan lower.Kin CheungAssociated Press[SeeCurrency,C4]COMMENTARY