Commodity run dwarfs oil spat as emerging markets set to win
For some of the worlds biggest money managers, the OPEC+ oil-price feud is little more than a sideshow when it comes to emerging markets.
Investors and strategists at JPMorgan Chase and Goldman Sachs say the post-pandemic economic recovery will stoke demand for raw materials across the board, buoying commodity-sensitive assets regardless of whether a crude accord is reached. Russia and Colombia are among the countries that stand to benefit in particular, according to Whitney Baker, the New York-based founder of Totem Macro, which advises funds overseeing more than $3 trillion.
“A generational opportunity exists today in many of the deepest-value emerging markets,” said Baker, the former head of emerging-market research at Bridgewater Associates. “Whether you export goods or whether you export commodities, you’re getting an external demand boom right now for pretty much whatever it is that you sell.”
Investors are looking beyond the spat between Saudi Arabia and the United Arab Emirates and the danger that 2020’s oil production free-for-all will be replayed. The global surge in demand for everything from copper to clothes as economies pick up steam amid the vaccine rollout will provide a backstop for many developing nations, they say.
Cheap valuations and hawkish central banks will support currencies with the closest ties to oil’s moves should a slump in crude materialize. Front-loaded tightening cycles in Russia and Mexico make those countries’ currencies especially appealing, Chris Turner, the head of currency strategy at ING Groep in London, said on Bloomberg TV.
That sentiment was echoed by Goldman strategists including Zach Pandl and Kamakshya Trivedi, who flagged value in Russia’s ruble, Mexico’s peso and Brazil’s real, despite the past week’s volatility.
While assets from Colombia, Mexico and Russia are historically among the most sensitive to swings in crude oil prices, the Colombian peso is down 11%, while the Mexican peso and Russian ruble are little changed this year, according to data compiled by Bloomberg. Brent prices have climbed almost 50% year-to-date, despite the OPEC+ spat.
Pierre-Yves Bareau, the London-based head of emerging-market debt at JPMorgan Asset Management, highlighted the lag. The demand recovery will support commodities — currently trading near a six-year high — providing a positive backdrop for many assets in Latin America and the Gulf, he said.
But with the delta variant of Covid-19 spreading, others are less sanguine.
“The market thinks of emerging markets as the next vaccine trade — I don’t agree with that,” said Bhanu Baweja, the London-based chief strategist at UBS Group, who is bearish on commodities.
A scenario where oil drops further could boost a net importer like Turkey, where the impact of commodity prices on inflation is particularly acute. The lira has slid 14% this year, the most in the world, as the country’s central bank juggles soaring prices and rate-cut demands from President Recep Tayyip Erdogan.
Should the outlook for oil darken, it could still favor Russia and Qatar over other exporters, given their valuations and sovereign fiscal resilience, said Hasnain Malik, Dubai-based head of research at Tellimer.
But for the next few months, sentiment on oil-sensitive emerging markets could be shored up by supportive factors for crude.
Jeff Currie, Goldman’s global head of commodities, said it’s “extremely unlikely” oil will unravel on the scale of last year’s collapse. A surge in demand during the northern hemisphere’s summer travel season and delays reaching an Iranian nuclear accord will keep crude around $80 per barrel in the third quarter, he said.
“The market environment we see today is probably one of the best in decades,” he said on Bloomberg TV.
Published : July 13, 2021
By : Syndication Washington Post, Bloomberg · Ben Bartenstein
Wall Streets $6 Billion Bonanza Chilled by China IPO Curbs
Just months after bankers celebrated a record haul from taking Chinese companies public in New York and Hong Kong, theyve had a rude awakening. Deals are being shelved and investors are nursing heavy losses.
Achill has settled over global finance after a fortnight in which China first cracked down on its Uber-like Didi Global within days of a U.S. trading debut, followed swiftly by the State Council announcing closer scrutiny of all offshore listings. On Saturday, a cybersecurity review was proposed for companies with data on more than 1 million users before they seek to list in foreign countries.
The warning signs had been flashing for a while. As underwriters totted up a record $1.5 billion in fees last year from helping Chinese firms with initial public offerings offshore, relations between China and the U.S. were at a low ebb. In December, President Donald Trump signed a bill that could delist Chinese companies that don’t meet audit inspection rules. Simultaneously, President Xi Jinping stepped up oversight of big technology firms, partly to secure the treasure trove of data they control.
The moves imperil the frenetic dealmaking seen during the pandemic, and the lucrative business of offshore listings that’s pulled in some $6.4 billion in fees since 2014, when Alibaba Group Holding began trading in New York. Morgan Stanley, Goldman Sachs and China International Capital Corp. topped the league tables over that stretch, when nearly 40% of fees came from U.S. deals.
Bankers now say they expect the majority of Chinese IPOs aimed for American exchanges to be suspended or diverted to other venues, eating into projected revenue for the year given the significantly lower fees in Hong Kong. Listing requirements in the financial hub and mainland China are also more stringent, making deals there far from certain.
“There are some uncertainties that might take one or two months to work its course,” David Chin, head of investment banking in Asia Pacific at UBS Group AG said of China’s changing rules at a briefing last week. “Ultimately, China will find a solution because the U.S. has been very supportive of Chinese internet companies, the development of them, and the subsequent financing.”In the meantime, what had been a healthy IPO pipeline is weakening. One immediate victim was LinkDoc Technology Ltd., a Beijing-based medical data company, which halted preparations for a U.S. IPO on Thursday. Fitness app Keep has also opted not to go ahead with a planned U.S. public filing, the Financial Times reported. Podcast app Ximalaya’s U.S. IPO is in limbo too, according to people with knowledge of the matter.
For some, the pullback came earlier. TikTok owner ByteDance Ltd.’s considerations about going public — which included a potential offshore float — have been in flux since earlier this year as it works to ensure compliance with China’s data security requirements, according to a person familiar with the matter.
In all, China’s crackdown on overseas listing threatens about 70 other private firms based in Hong Kong and China that are set to go public in New York, according to data compiled by Bloomberg.
Valuations for China’s technology firms, which were already falling before the recent onslaught, now look shakier as investors signal they will demand steeper discounts to buy shares, said one banker, asking not the named discussing internal business. So far this month, the Nasdaq Golden Dragon Index — which tracks some of the biggest Chinese firms listed in the U.S. — has shed some $145 billion in value.
At the heart of the recent crackdown is how far regulators will go to check foreign investment in sensitive industries, particularly those controlling vast amounts of data. For two decades China’s technology giants have sidestepped restrictions, using the so-called Variable Interest Entity model to attract foreign capital and IPO offshore.
The China Securities Regulatory Commission is now leading efforts to revise overseas listings rules that would require VIE firms, which do business in China but are registered in places like the Cayman Islands, to seek approval before selling shares overseas, Bloomberg has reported. The Cyberspace Administration of China said Saturday that its proposed review would address risks for data to be “affected, controlled, and maliciously exploited by foreign governments.”
Hong Kong looks well placed to benefit from the geopolitical and regulatory frictions though dealmaking in the financial hub may also become entangled in the regulatory push. If IPOs of Chinese unicorns grind to a halt, the Hong Kong exchange should still be boosted by secondary listings and the conversion of American depository receipts, according to Bloomberg Intelligence analyst Sharnie Wong.
“Some Chinese companies that operate in sensitive sectors might be thinking of listing in Hong Kong instead of the U.S.,” said Kenneth Ho, managing director of equity capital markets at Haitong International. “Currently the H.K. IPO pipeline is ridiculously vibrant.”
The rerouting will undercut fees banks can earn after a decade in which Chinese firms raised about $76 billion through first-time share sales in the U.S.
Banks typically charge about 1.5% to 2% for billion-dollar offerings in Hong Kong, compared with 3% to 5% in the U.S. as fees vary with sectors and underwriters. That increases by about two percentage points or more for deals below $500 million, bankers familiar with the matter said.
In mainland China, fees for listing on Shanghai’s tech-heavy STAR board are about equal to the U.S. but sponsors are required to co-invest in between 2% and 5% of the shares issued by their clients, an unusual arrangement that may limit interest in leading deals due to the need for a capital base onshore.
The tighter regulatory regime comes against a backdrop of China opening its financial market to allow foreign banks and asset managers to set up wholly owned firms. Powerhouses such as Goldman Sachs have been ramping up their staffing, seeking to double or triple their headcounts in mainland China, as they expand to capture billions in potential profits in the world’s second-largest economy.
China’s Nasdaq-like STAR market has made it easier for technology firms to access funding at home, though it places an emphasis on companies focused on hardcore technology and innovation.
China’s dependence of foreign capital to fuel its businesses has decreased from where it was less than a decade ago, said Martin Chorzempa, senior fellow at the Peterson Institute for International Economics. “We’re in a world where it’s not really that hard for Chinese firms to raise a large quantity of capital without listing their shares aboard.”
Even so, UBS’s Chin said it’s doubtful that many Chinese companies can meet domestic listing requirements, which have become more stringent this year.
“Ultimately they’ll have to list somewhere else,” he said. “We are very used to this type of regulatory development and uncertainties, and ultimately the commercial logic will prevail and the financing and IPOs will continue.”
Published : July 13, 2021
By : Syndication Washington Post, Bloomberg · Cathy Chan
Stocks hit records ahead of earnings; oil falls: Markets Wrap
U.S. stocks climbed to another all-time high as investors await second-quarter earnings starting this week to gauge whether corporate profits can support equity valuations. Treasury yields fluctuated as the U.S. sold debt.
Financials and real estate shares led the S&P 500 to a record, while the tech-heavy Nasdaq 100 was mostly little changed. Both indexes set their previous closing marks on Friday. The Stoxx Europe 600 gained for a second day and Asian equity indexes closed in the green.
The U.S. Treasury sold $58 billion of three-year notes at yields slightly higher than before the auction. A sale of $38 billion of 10-year notes was greeted by stronger demand. The dollar pared earlier gains against major peers.
“The biggest things on people’s minds right now are the start of earnings season and the economic releases on the inflation front,” said Eric Freedman, chief investment officer at U.S. Bank Asset Management Group.
Equities and bonds have rallied amid a decline in long-term interest rates and inflation expectations as central banks hold off on unwinding the support driving the recovery from the pandemic. Still, investors remain concerned about the spread of the delta variant and a slowdown in vaccination rates, while pondering when the Federal Reserve will start tapering stimulus.
“The question at the core of the movements in the 10-year Treasury’s yield for most of this year has been whether economic re-openings stateside and around the globe will generate levels of longer lasting inflation for economies, central banks and markets to contend with or will the near-term inflation consumers and businesses are experiencing be transitory as economies transition to a post-Covid environment,” John Stoltzfus, chief investment strategist at Oppenheimer & Co., wrote to clients.
Elsewhere, Asian stocks rose at the start of the week after China’s central bank moved to boost liquidity by cutting the amount of cash most banks must hold in reserve to buttress economic growth.
The euro weakened and yields on core European bonds fell after European Central Bank President Christine Lagarde told investors to prepare for new guidance on monetary stimulus in 10 days. Oil was lower after its first weekly loss in seven amid an OPEC+ dispute over a production increase.
These are some of the main moves in financial markets:
Stocks:
– The S&P 500 rose 0.2% as of 1:29 p.m. New York time.
– The Nasdaq 100 rose 0.1%.
– The Dow Jones Industrial Average rose 0.4%.
ADVERTISEMENT
– The MSCI World index rose 0.4%.
Currencies:
– The Bloomberg Dollar Spot Index rose 0.1%.
– The euro fell 0.2% to $1.1856.
– The British pound fell 0.1% to $1.3881.
ADVERTISEMENT
– The Japanese yen fell 0.2% to 110.35 per dollar.
Bonds:
– The yield on 10-year Treasuries was little changed at 1.36%.
– Germany’s 10-year yield was little changed at -0.29%.
– Britain’s 10-year yield was little changed at 0.65%.
Commodities:
– West Texas Intermediate crude fell 1.1% to $73.74 a barrel.
– Gold futures fell 0.2% to $1,806.10 an ounce.
Published : July 13, 2021
By : Syndication Washington Post, Bloomberg · Vildana Hajric, Claire Ballentine
The Stock Exchange of Thailand (SET) Index closed at 1,549.84 on Monday, down 2.25 points or 0.14 per cent. Transactions totalled THB75.44 billion with an index high of 1,561.72 and a low of 1,544.71.
In the morning session, Krungsri Securities expected the index on Monday to rebound to between 1,560 and 1,565 points on the rising oil price and Thailand’s move to impose a partial rather than a national lockdown.
However, it forecast the rise in domestic Covid-19 cases and volatility in foreign fund flows would pressure the index.
The 10 stocks with the highest trade value today were PTTGC, CHG, BCH, KCE, PTT, BDMS, HANA, KBANK, CPF and ACE.
Other Asian indices were up:
Japan’s Nikkei Index closed at 28,569.02, up 628.60 points or 2.25 per cent.
China’s Shanghai SE Composite Index closed at 3,547.84, up 23.75 points or 0.67 per cent, while the Shenzhen SE Component Index closed at 15,161.52, up 317.17 points or 2.14 per cent.
Hong Kong’s Hang Seng Index closed at 27,515.24, up 170.70 points or 0.62 per cent.
South Korea’s KOSPI closed at 3,246.47, up 28.52 points or 0.89 per cent.
Taiwan’s TAIEX closed at 17,814.33, up 152.85 points or 0.87 per cent.
Volatile foreign funds flow expected to pressure SET
The Stock Exchange of Thailand (SET) Index rose by 7.23 points, or 0.47 per cent, to 1,559.32 on Monday morning.
The SET Index closed at 1,552.09 on Friday, up 8.42 points or 0.55 per cent. Transactions totalled THB85.26 billion with an index high of 1,554.60 and a low of 1,535.69.
Krungsri Securities expected the index on Monday to rebound to between 1,560 and 1,565 points on rising oil price and the Centre for Covid-19 Situation Administration’s move to impose partial lockdown instead of a national lockdown.
However, it predicted that the rise in the country’s Covid-19 cases and volatility in foreign funds flow would pressure the index.
It recommended that investors buy:
▪︎ PTT, PTTEP, BANPU and TOP, which benefit from rising oil price.
▪︎ HANA, KCE, TU, CPF, ASIAN and EPG, which benefit from the weakening baht.
▪︎ BCH, CHG, BDMS, HMPRO, GLOBAL, DOHOME, BEM, CKP, CBG, ICHI and GPSC, whose second-quarter business turnover is expected to improve.
Baht stares at 33 to the dollar as foreign investors leave due to Covid crisis
The baht opened at 32.50 to the US dollar on Monday, strengthening from Friday’s closing rate of 32.60.
The Thai currency is likely to move between 32.45 and 32.60 during the day and between 32.40 and 32.90 this week, Krungthai Bank market strategist Poon Panichpibool said.
Poon said that the baht would weaken, as foreign investors had decided to sell their assets in Thailand due to uncertainty caused by Covid-19 in the country. This situation will improve if 500,000 doses of Covid-19 vaccine are distributed every day.
Poon predicted that the baht could fall to 33 to the US dollar if it passes a resistance between 32.70 and 32.80.
Last week, Covid-19 outbreaks in several countries had pressured emerging markets. Numerous central banks have already run more relaxation measures.
Gold continues upward trend as demand for safe-haven investments grows
The price of gold in Thailand rose by THB100 per baht weight on Monday morning on mass buy-ups of safe-haven assets amid uncertainty over the impact of Covid-19 on the economy.
The Gold Traders Association report at 9.25am showed buying price of a gold bar at THB27,800 per baht weight and selling price at THB27,900, while gold ornaments were priced at THB27,303.16 and THB28,400, respectively.
At close on Saturday, buying price of a gold bar was THB27,700 per baht weight and selling price THB27,800, while gold ornaments were priced at THB27,197.04 and THB28,300, respectively.
The price had risen by THB650 per baht weight last week.
Spot gold price on Monday was US$1,806 (THB58,895) per ounce after Comex gold on Friday rose by $10.4 to $1,810.6 per ounce.
Hong Kong gold price, meanwhile, rose by HK$40 to $16,750 (THB70,324) per tael, the Chinese Gold and Silver Exchange Society reported.
Golden Age for China brands bolstered by tech crackdown
Chinas intensifying crackdown on technology companies is proving to be a cautionary tale for investors in the nations startups, with one notable exception: consumer brands.
From cosmetics to bubble tea, Chinese ventures making waves among a new generation of shoppers are becoming a magnet for funds hunting for their next big hit. Investors may see such companies as a viable alternative to tech startups because the government, rather than clamping down, is pushing to foster domestic champions that can fuel spending and compete with the likes of Coca-Cola and Nike.
Beijing’s tightening regulation is increasing barriers to invest in traditionally popular areas such as tech, said Mark Tanner, managing director of Shanghai-based marketing and branding firm China Skinny. “In contrast, consumer sectors from food, fashion to fitness and leisure are seeing increased interest from investors with more policy support,” he said.
Chinese brands are grabbing market share from global rivals in the world’s largest consumer market. Even before the tech crackdown, consumer-sector startups including healthy beverage maker Genki Forest and KKR & Co.-backed dairy producer Adopt A Cow were drawing more funding — about $62 billion since 2018, according to data provider Preqin Ltd. While that’s dwarfed by the $112 billion put into tech, the number is expected to increase in coming years.
“The next decade will be the golden age for the rise of Chinese brands,” said Frank Wei, co-head of Warburg Pincus China, which invested in Genki Forest, valued at $6 billion. “The rise of Generation Z reshapes the industry.”
China’s decision to curb business of ride-hailing giant Didi Global Inc. days after its U.S. listing is the latest bombshell for tech investors, who have seen a months-long clampdown hurt shares of companies from Alibaba Group Holding to Tencent Holdings.
That’s denting fundraising plans of tech startups. LinkDoc Technology Ltd., which provides healthcare services using artificial intelligence, halted its plans for a U.S. initial public offering, Bloomberg reported on Thursday.
Authorities in Beijing are worried that tech firms listing in the U.S. pose a security risk because of the vast troves of data they hold. So far they are focusing on internet companies — which are most adept at harnessing and employing user information — rather than those that provide everyday products.
The consumer sector is a good option for capital to shift to because it faces much lower policy risks than tech and education — which has also faced a crackdown — a person from a Shanghai-based private equity firm said, asking not to be identified because of the sensitivity of the matter. On the downside, consumer companies face fierce competition and uncertain growth prospects, the person said.
One Chinese venture capital business is considering shifting its focus to categories that are most likely to get government support and favorable policies, including local consumer brands and environment-friendly enterprises, a person at the company said.
Once regarded as cheap and inferior, Chinese brands saw transactions grow 6% more than that of foreign counterparts in 2020, according to a research report by e-commerce platform JD.com Inc. Investors have backed more than 3,500 deals in the nation’s consumer discretionary sector since 2018, Preqin figures show.
Yatsen Holding Ltd., owner of cosmetics house Perfect Diary, has become a growing threat to the likes of L’Oréal and Estée Lauder and stands as the second-largest brand, with 6.7% of the crowded market for color make-up such as lipstick and mascara, Euromonitor estimates. It attracted investors including Warburg Pincus and Hillhouse before listing in the U.S. last November.
Pop Mart International Group Ltd., a Chinese toy maker, attracted more than $100 million from firms including Sequoia China before garnering HK$5 billion ($644 million) in its Hong Kong IPO last December.
Heytea, a Shenzhen-based teahouse chain, is favored by the likes of IDG, Sequoia China and Hillhouse and is now valued at more than 60 billion yuan ($9.2 billion) after its latest round of fundraising, according to a person familiar with the matter. The company declined to comment.
ADVERTISEMENT
Local rival Nayuki Holdings Ltd. raised $656 million in a Hong Kong IPO last month.
One reason for the rapid rise of local brands is their ability to reach customers through social media and livestreaming shopping platforms. Online goods sold via livestreaming could grow 25% to 1.2 trillion yuan this year, according to consultant iiMedia Research.
“Social media enables new brands to be recognized much faster than via traditional marketing channels,” said Helen Wong of Qiming Venture Partners. “Therefore, the consumer startups are more attractive to us than before as our investment is expected to pay back sooner.”
Companies like Hangzhou-based Adopt A Cow devote most of their marketing budgets to livestreaming. The direct-to-consumer firm allows people to track a cow online and works with influencers including Qianxun (Hangzhou) Co., co-founded by China’s millionaire livestreaming queen Viya.
Livestreaming platforms “are giving birth to a plethora of new Chinese brands,” said Zhao Ran, president of Qianxun (Hangzhou), which works with more than 20,000 of them. They are devoting more of their budgets to such marketing than their foreign counterparts, which are trying to catch up on the trend.
ADVERTISEMENT
“New brands always emerge with the advent of new media platforms,” said Zhao. “Livestreaming is now the most important new media marketing channel.”
Nationalism has also played a role in the shift toward domestic names. Global titans including Nike and Adidas are facing pressure in China after shoppers boycotted them for taking a stand against the treatment of Muslim Uyghurs in the Xinjiang region.
Still, valuations are reaching frothy territory, with multiple funds chasing the same companies to convince founders that they can bring in resources beyond cash.
“Normally, a decision process to invest in a startup may take two months but now, anxious investors can shorten the process to just two weeks, skipping some steps such as issuing term sheets or just doing very simple due diligence,” said Loreal Chen, a Shanghai-based financial adviser who helps link founders with venture capital and private equity firms.
The investments can be risky. A slew of Chinese brands have gone under just as fast as they emerged. Eye-shadow seller Apinkbaby, which had more than 180,000 online followers, went bankrupt earlier this year.
For now, Genki Forest’s President Zhang Guizhou is banking on the billions that come with the rising interest in home-grown champions.
“International brands are no longer the top choice for Chinese consumers,” said Zhang. The younger generation “aren’t overly obsessive and idolizing foreign products and brands anymore.”
The Bank of Thailand said THB66.898 billion had been disbursed under the latest loan rehabilitation project, as of July 5, with approvals given to 21,929 people who received assistance, with a limit of THB3.1 million per person.
The BOT had opened for financial institutions to seek loan rehabilitation on April 26, consisting of measures to support loan rehabilitation of THB250 billion and the Asset Warehousing project with a budget of THB100 billion.
Loans approved to SMEs amounted to THB31.629 billion, or 47.3 per cent. It said 9,674 people received credit lines accounting for 44.1 per cent, followed by THB27.464 billion to large businesses, accounting for 41.1 per cent, and debtors about 7 per cent.
Fear on top of fear: Why anti-gun Americans joined the wave of new gun owners
All his life, Jabril Battle was anti-gun. Then came the pandemic, the lockdown, the shortages and a feeling that at any moment, things could blow. Battle bought a Beretta.
Drawn to last summer’s protests against police violence, Savannah Grace found herself face-to-face with a camo-clad officer’s long gun. She’d always hated guns, but went out and got a Glock 45.
In blue cities and red suburbs alike, firearms purchases soared last year – to the highest level in half a century, based on federal background checks. A striking portion of those sales went to first-time gun buyers – 40%, according to the firearms industry’s trade association. Other studies show first-timers accounting for more like a fifth of sales in 2020, but that’s still unusually high, retailers said.
Overall gun ownership nationwide jumped from 32% of Americans to 39% last year, according to University of Chicago survey data – well under the 50% level of half a century ago, but the biggest jump in recent decades.
From the downtown streets left empty by the pandemic’s shutdowns to the sharp spike in homicides and the nationwide conflict over the role and behavior of police officers, a disorienting and often frightening year drove many decisions to buy guns, according to dealers and buyers alike.
“It really was a perfect storm of concerns” that drove sales, said Mark Oliva, spokesman for the National Shooting Sports Foundation, which tracks the numbers.
Shakima Thomas, a social worker in Newark, had always thought of guns as loud and dangerous – nothing she wanted anything to do with.
She grew up around firearms; her grandmother carried a handgun in her purse, and several close relatives had served in the military and owned guns. But Thomas, 39, never considered buying one for herself until Donald Trump’s presidency. Trump’s boast that he could shoot someone on Fifth Avenue and not lose any of his support made Thomas fear that some Americans might be emboldened to express their rage violently.
A lifelong Democrat, she got a gun permit early in the Trump administration but didn’t buy her first gun until last summer, when the killing of Floyd and the protests that spread across the nation made Thomas feel like the country was spiraling out of control, “like the world was in an apocalypse.”
She walked into RTSP – a gun store whose name stands for Right to Self Protect – and bought an AR-15 assault rifle. Months later, she added a handgun.
“I never felt like I would want to own a gun because of the damage I thought they do to people,” she said. “But when I started feeling unsafe, all of that changed.”
Sales to women and people of color rose in 2020. Firearms industry data shows sales jumping 50% among Black customers, 47% among Hispanics and 43% among Asian Americans, though gun ownership remains proportionately lower among those groups compared with Whites.
“Typically, my customers were always White men and White women concerned about who was president and what restrictions were coming,” said Michael Cargill, owner of Central Texas Gun Works in Austin. “Then last summer, you had the protests and downtown was basically boarded up. Law enforcement all went downtown. Right away, we had lines out the door every day.”
“It didn’t matter if you were Democrat or Republican, White or Black,” said Cargill, who is Black. “One side said, ‘Trump’s going to be reelected and it’s going to get violent,’ and the other said, ‘Biden’s going to win and he’s going to come after the guns.’ My instructors and I became like gun therapists for people who never had guns before or really didn’t like guns. One lady came in here in tears, with her teenagers, and she said, ‘This goes against everything I believe in, but I need my family to learn how to protect themselves.'”
The new gun buyers included many women who felt vulnerable to a wave of violent crime. Some were Black city dwellers such as Karen Williams-Adir, a former Los Angeles bus driver who now writes fiction, and some were White conservatives living in the heartland.
Williams-Adir, 49, feels safe at home in Ladera Heights, an affluent enclave on Los Angeles’ west side, but over the past few years, she’s been unnerved by news of mass shootings, police brutality and Trump’s “America First” rhetoric.
“Certain people, certain colors were being targeted,” she said. “I started getting angry because I don’t understand why people just don’t respect people’s space.”
But it wasn’t until the Floyd killing and the explosion of anguish that followed that Williams-Adir decided to buy a gun.
“What happened to George Floyd just flipped my wig,” she said. “It was just too hysterical. People were on edge. Enough was enough. I figured, if you want to come to my home and do harm to me for any reason, you might not ever go home again to yours.”
ADVERTISEMENT
She worried about being stopped – particularly by police – as she moved about the city. “If I do everything you tell me to do and don’t resist and I’m not armed, will I walk out of here alive?” she wondered.
Despite her concern about police violence, she’d still call them to her home if she needed help. But having a gun at home means she no longer feels the need to rely on them.
First, Williams-Adir bought a .32 Beretta, a gun petite enough to fit comfortably in her hands. Since then, she’s added two other handguns and a shotgun. The weapons, she said, give her peace of mind.
“It just felt like we needed to be able to defend ourselves,” Williams-Adir said, speaking especially of Black women. “And I’m not bringing a knife to a gunfight.”
Schuyler Brubaker, a 21-year-old senior at Oklahoma State University, also perceived growing danger in her college town of Stillwater. Her perception of risk stemmed not from racial tensions, political protests or police behavior but from news headlines about sex trafficking and attacks on young women who were exercising alone or using ride-hailing services.
ADVERTISEMENT
In her conservative community, she sensed a lot of fear that a Democratic administration would impose strict gun controls. At a sporting goods store one day, she heard a woman “talking about how she thought ‘I’d better go get [a gun] before Biden'” won the election.
“I’m a Republican, and I don’t care for Biden,” Brubaker said, “but I didn’t think he was going to come and steal anyone’s guns.”
Rather, what drove her to the gun shop was her sense that violent crime was coming too close for comfort. “I’ve had friends who have almost been abducted,” she said. “Stillwater is not a safe place, but there are some sketchy people here.”
Murders and other types of violent crime are rare in Stillwater, though homicide numbers soared last year in many U.S. cities.
Last summer, soon after she turned 21, Brubaker and four friends signed up for a concealed-carry training course. Then she bought herself the same kind of compact 9mm Smith & Wesson pistol that her godmother, a certified instructor, taught her to shoot when she was 13.
Brubaker, a fashion merchandising major, said she inherited her acute concern for personal safety from her mother, whose career as a paramedic and then a nurse exposed her to plenty of trauma.
Her mother doesn’t own a gun, but she “made me watch the news” and kept Brubaker aware of Amber Alerts, leaving her daughter “overly cautious,” Brubaker said. “Besides, I have no upper-body strength whatsoever, so me trying to fight my way out of a bad situation isn’t a good option.”
Now, Brubaker said, her gun lends her a sense of security: “If I want to go for a walk around the lake or if I want to go hiking by myself, I carry it with me.”
Politics – along with mass shootings and natural disasters such as 2005′s Hurricane Katrina – have long driven gun sales. For decades, whenever a Democrat has been elected president, several months of surging sales have ensued, as customers concerned about the prospect of tighter restrictions on guns hurried in to stock up.
“The more an administration talks about gun control, the more you’re going to hear cash registers ring,” Oliva said.
But Thomas, the Newark social worker who bought a rifle and pistol last year after protests against police violence made her feel unsafe, said she remains a committed Democrat. She agrees with the cause that peaceful protesters promoted last summer, yet the chaos and destruction she saw in her city and around the country pushed her to take action to defend herself. In the end, she said, her attitude toward guns does not define her political identity.
For many new gun owners, though, the decision to arm themselves is a political pivot – an accumulation of anxieties that led them to discard long-held beliefs. It’s a decision that is particularly difficult for people who belong to groups at higher risk of being on the wrong end of gun violence.
Jabril Battle, a 28-year-old account representative at a financial services company in Los Angeles, had always believed that “anyone who had a gun was a gun nut,” he said. “I really bought into the whole idea that the more people have guns . . . the more likely it is for people to start killing each other.”
But as the pandemic paralyzed the nation, Battle said, “I just saw how crazy people got.” He found himself conjuring the worst scenarios: “I was like, if my block has 10 houses, how many people in these houses have guns? If the food and water gets cut off, [if] supplies run out . . . what does that look like? Is this going to be a ‘Mad Max’ situation? Like ‘The Walking Dead,’ but not with the zombies?
“I was just, like, ‘Do I want to be the person who has a gun or doesn’t have a gun?”
Battle bought a Beretta 92FS, then added a Glock 34 pistol.
Still, he had reservations: “Being Black with a gun is a very high risk, a way higher risk than other races,” he said. “You are seen as a threat without a gun, and with a gun you are seen as a super threat.”
He kept imagining the scene if he were stopped by a White police officer.
“It’s still in my head, honestly, when I go to the gun range and I have my gun in my car,” he said. “If I get pulled over, and they ask, ‘Are there any weapons in the car?’ [and] I say there’s a gun, and then I hand in my registration, will they shoot me?”
But he’s enjoying the new world that guns opened to him – classes, an organization of Black gun owners, shooting competitions.
“Once I started being around guns more, and I kind of saw the culture and the environment, I’m falling in love,” he said.
In Battle’s family, guns were “not a good thing,” he said. “It kind of represented crime, especially for Black people. It’s just different for African Americans.”
But his family has accepted his decision, he said. His grandmother and two aunts came to the range with him and are considering returning to take lessons.
The powerful emotions that drive both sides of the gun debate cause many gun dealers to try to keep politics out of their shops – a stance that became even more important over the past year, as demand surged.
“We don’t take any positions and we don’t make any judgments,” said Charrie Wexler, a firearms instructor who works with her husband, Brandon, at Wex Gunworks in Delray Beach, Fla.
Starting with the coronavirus shutdowns in March 2020, “we got a massive increase in women, Blacks, Asians, transgender people,” she said. “They started coming in when there was all that talk of defunding the police and when people didn’t know what covid would mean and worried that people might come to their homes trying to get their supplies.”
“It was like watching one of those end-of-the-world movies,” Brandon said. “You saw fear.”
“Fear on top of fear on top of fear,” Charrie said. “Women, especially, would say, ‘I don’t believe in guns, I don’t like them, but the world has gone crazy.'”
In a scary time, Savannah Grace wanted not just protection, but a sense of belonging and community. A transgender woman who took part in protests in Richmond last summer, Grace, 31, grew up in a home where guns were culturally alien. But the combination of being confronted by law enforcement officers at protests and feeling endangered because of her gender identity prompted her about-face.
“I’ve been threatened just for being who I am,” she said. Being armed was a way to assert control and gain political power: “As soon as any marginalized group starts arming themselves, that’s when policy gets pushed through a little bit more,” she said.
She started going to a gun range with a friend who was a veteran enthusiast. She liked how shooting made her feel. And she liked the array of people at the range – “people of color were there,” said Grace, who is White, “and other queer couples were there, so that was kind of fun to see. ‘We’re here!'”
She signed up for a concealed-carry course through an organization called Armed Trans Women “and then one day, I was just like, I’m going to do this,” she said.
She bought a Glock 9mm handgun, which she keeps loaded in her dresser. She makes sure to handle it almost every day, “just to make sure I’m comfortable with it.” She feels safer now, especially since she lives “in a household that could be targeted by people. We fly a rainbow flag and people in my house are known activists.”
She doesn’t expect to use the weapon. She’d be unlikely “to shoot a burglar or something like that,” she said. “Like, if they’re stealing my TV, they probably need it more than I do.”
But when she’s going to a protest where she expects to be near “right-wing gun owners,” she carries openly, “just to be, like, ‘Hey, we both have these, let’s keep our distance.'”
Other than her attitude toward guns, Grace’s politics haven’t changed, but she’s had to alter the way she thinks of herself: She now defines herself as a gun person “who hates gun people.”
Published : July 11, 2021
By : The Washington Post · Marc Fisher, Miranda Green, Kelly Glass, Andrea Eger
SootinClaimon.Com 