Biden’s Infrastructure Bill: Talks Drag On. The Stock Market Shrugs.

The falling value is not great for the stocks. But, for investors, implementation of government policy never seems to be quite as bullish as the initial discussions.

From Biden’s election victory to the time he introduced his $2.3 trillion plan to remake the U.S. electricity grid, while repairing roads and bridges, the

iShares U.S. Infrastructure ETF

returned about 30%. Since late March, the ETF has been flat, despite the

S&P 500

continuing to march higher.

Shrinking size is a problem. So is the nature of politics. Politicians seemingly take forever to work out policy details. And implementation of spending happens years after bills are made into law.

The best bet for infrastructure-related stocks is a continuation of the post Covid-19 economic recovery. Fortunately for investors, manufacturing activity continues to accelerate.

If infrastructure stimulus gets passed, that will just be a bonus.

—Al Root

*** Hear from Palantir CEO Alex Karp, Vimeo CEO Anjali Sud and other tech executives and investors at Barron’s Investing in Tech. The virtual event on June 16 will examine innovations and opportunities in tech investing. Learn more and sign up here.

***

Exxon Faces Board Fight With Activists at Shareholder Meeting

Exxon Mobil

faces a fierce proxy battle at its annual shareholders meeting set for today. Activist investors are pushing for four board seats and a larger embrace of renewable energy.

• Shareholders, led by a newly formed investment firm, Engine No. 1, have gained some support from proxy-advisory firms over the past few weeks. Engine No. 1 has called out the company for what it called a poor capital-allocation strategy and a failure to prepare for a decarbonizing world.

• The firm attracted the support of the California State Teachers’ Retirement System, the California Public Employees’ Retirement System, the New York state Common Retirement Fund, and the Church of England.

• Proxy-advisory firm Institutional Shareholder Services has backed three of Engine No. 1’s candidates, while Glass-Lewis supports two of them. The opinions of proxy-advisory firms tend to carry a lot of weight with pensions and other institutional investors.

What’s Next:

BlackRock,

State Street,

and Vanguard together hold nearly 21% of Exxon’s shares and all have spoken about the need for businesses to address climate change. BlackRock voted for three of Engine No. 1’s four nominees, according to The Wall Street Journal.

—Connor Smith and Carleton English

***

Amazon Faces Legal Scrutiny Over Its Online Pricing Policies

The District of Columbia Attorney General sued

Amazon.com

in local superior court, accusing the e-commerce giant of using its might to undercut competitors by prohibiting third-parties on its platform from selling their products for lower prices elsewhere, including their own websites.

• “Amazon wins because it controls pricing across the online retail sales market, putting itself at an advantage over everyone else,” D.C. Attorney General Karl Racine said Tuesday. Amazon also monitors its sellers’ prices on other websites.

• The antitrust suit seeks to end Amazon’s use of pricing agreements to squelch competition. Racine told CNBC that Amazon quietly replaced a former policy with one that says third-party vendors offering their products at lower prices on other sites can be sanctioned or removed from Amazon.

• Amazon said the attorney general “has it exactly backwards,” that sellers set their own prices on Amazon, and “like any store we reserve the right not to highlight offers to customers that are not priced competitively.”

• A House Judiciary subcommittee on antitrust examined Amazon’s pricing agreements in a 400-plus-page report last fall, and agreed that Amazon uses its dominance to require third-party sellers to comply with its most-favored-nation clauses.

What’s Next: Racine said the agreements result in higher prices for consumers because they include Amazon’s fees of up to 40% of the product price. Amazon says its seller fees are competitive, but that the attorney general’s actions would force it to raise prices, “oddly going against core objectives of antitrust law.”

—Janet H. Cho

***

Red-Hot Housing Market Rose at Fastest Rate Since 2005

Home prices are blazing hot, growing at the fastest rate in March since the bull market of 2005, raising some alarms in Washington about the availability of affordable housing for those struggling to recover from the pandemic.

• Home prices in the 20 major metropolitan areas tracked by the S&P CoreLogic Case-Shiller 20-City Composite Home Price index grew 13.3% annually in March, beating expectations for a 12.4% gain over the prior year.

• New single-family home sales fell 5.9% in April from the prior month but are up 48.3% over last year, the Census Bureau reported.

• Luxury home builder Toll Brothers beat earnings estimates for the quarter with a record 85% increase in the number of homes contracted over the past year even as it raised prices.

• The White House is monitoring rising U.S. home prices out of concern for affordability, press secretary Jen Psaki said Tuesday, repeating President Joe Biden’s proposal for $20 billion in new tax credits for developers to renovate single family homes.

What’s Next: The National Association of Realtors will report pending-home sales for April on Thursday, a leading indicator of existing home sales in May and June. Economists polled by FactSet expect pending-home sales to increase 1.1% month over month.

—Liz Moyer

***

Moderna Seeks to Be the Second U.S. Covid Vaccine Approved for Adolescents

Moderna

announced Tuesday that it plans to seek authorization from the Food and Drug Administration in early June to become the second coronavirus vaccine approved for use in children 12 and older. Its mRNA vaccine proved safe and 100% effective at preventing Covid-19 in clinical trials among children aged 12 to 18.

• More than 5 million adolescents 12 to 17 years have received at least one dose of a Covid vaccine so far. Centers for Disease Control and Prevention Director Dr. Rochelle Walensky said more vaccinations could make it easier to hold summer camps and in-person school this fall.

• The White House Covid team on Tuesday said more than 131 million Americans are fully vaccinated, including half of U.S. adults, 74% of people 65 and older, and 47% of those 12 and up.

• Public health authorities are encouraging efforts to reach out to still unvaccinated but eligible Americans to convince them to get their shots, aiming to get as much of the population covered as possible to cut off transmission.

• 
  United Airlines
  
  is holding a drawing for 30 pairs of round-trip, first-class tickets to any of its global destinations and five pairs of tickets for free travel for a year for vaccinated loyalty program members. To be eligible, members must upload proof of vaccination to United’s app or website by June 22.

What’s Next: White House senior adviser on Covid Andy Slavitt said vaccinations in Ohio jumped 55% among residents 20 to 49 after the Vax-A-Million lottery was announced. The first drawing is Wednesday, when one vaccinated adult resident will win $1 million, and one vaccinated teen will win a four-year state university scholarship.

—Janet H. Cho

***

U.S. Steps Up Calls for Independent Inquiry Into Covid-19 Origin

The Biden administration Tuesday reiterated its demand that an independent investigation probe deeper to determine the causes of the coronavirus pandemic, after doubts were raised on a recent World Health Organization inquiry that concluded it was unlikely to have been triggered by an accident in China’s Wuhan laboratory.

• A serious inquiry is a critical priority for the U.S., White House senior adviser on Covid-19 Andy Slavitt said during a briefing Tuesday. “We need to get to the bottom of this and we need a transparent process from China,” he added.

• According to a recent Wall Street Journal report, U.S. intelligence services believe that three researchers from the Wuhan Institute of Virology became sick and were hospitalized in November 2019, the moment when scientists believe the virus began circulating in the region before spreading globally.

• A group of international scientists wrote two weeks ago in the journal Science that the laboratory leak theory remains viable and that “more investigation is still needed to determine [its] origin.” It noted that most of the data fueling the WHO report had been provided by China.

• China has opposed further investigation of what happened at the Wuhan lab and a Chinese delegate told the WHO annual meeting Tuesday that the country’s part in the virus origin study has been completed. Beijing instead pushes for an investigation into other possible causes of the virus outside China.

What’s Next: WHO officials said in March that a second phase of research would be needed to dig deeper into the original source of the pandemic. But Beijing’s agreement and cooperation will be needed for independent scientists to investigate the Wuhan lab.

—Pierre Briançon

***

Dear Moneyist,

My husband and I have been married for 30 years. I thought we were happy. Boy, was I clueless. I just found out a couple of days ago that my husband has been hiding money, an ATM card, a savings account and a P.O. box from me for 10 years.

Here’s how I found out: I had to reschedule a trip to California for him due to his mother being ill. I used his Gmail account so he would have access to the flight information while he was gone. That’s when I discovered that he had been paying money to a company I knew nothing about, and had been doing so for a long time. I also found a different email address that he had been using.

When I asked him about all of these emails, he said, “You caught me. I’m a liar and I have been doing this for 10 years. If you want a divorce, that’s fine with me. Do it.”

He has been getting extra money from commissions and profit sharing from work each month, and he was making extra money from recycling. He only gave me a part of it and lied about the rest. He got scammed from a business that he thought would make him money.

His mother blamed me.

He asked his mother about hiding money from me. She sent him the funds to open an account, and advised him on how to do it. No big surprise there. His mother blamed me for our moving out of state for over 20 years. I don’t like her, and this was just another reason not to. We could have been paying down bills instead of struggling and have had to pull money out of my inheritance.

He said he was tired of working, and had been unhappy with me for 10 years. I was blown away. I was hurt and shocked. He brought up arguments that had been resolved a long time ago. I am still in shock, and I have been going over everything in my head since he left for California, and started getting angry.

He said he thought that he wasn’t worth $2,500 because I said he couldn’t have a scooter. What does that even mean? I am disabled and can’t get a job to make money. I don’t know if we will stay married, but I want to protect the last of my inheritance and two money-market accounts currently in my name. Should I take money out of that account, and put it in another bank where he can’t touch it?

—Stunned Wife

Read The Moneyist’s response here.

—Quentin Fottrell

***

—Newsletter edited by Liz Moyer, Stacy Ozol, Mary Romano, Matt Bemer