Its The Economy, Stupid - Economic & Business News From Around The World

[Fwiffo]

Inflation cooled to 4% in May — the lowest reading in two years

The inflation rate has been on a steady decline, but the latest numbers show there are still areas of the economy where consumer prices remain stubbornly high.

www.nbcnews.com

"Declines were seen across the board — but food price growth continues to accelerate faster than other categories, climbing 6.7% overall year on year. Food-at-home prices rose 5.8% while prices for food away from home climbed 8.3%."

Higher rates! 2% is the target!

 

[Fwiffo]

Instant Brands, maker of Instant Pot and Pyrex, files for bankruptcy

Tupperware not far behind...

 

[Fwiffo]

Bill Gates visits China as leaders try to revive foreign business interest

The Microsoft Corp. co-founder is among a series of foreign business figures visiting China after the end of anti-virus controls.

www.nbcnews.com

US business scions in order of their visit to China: Elon Musk. Tim Cook. Bill Gates.

 

[Fwiffo]

Pirelli: Italy blocks Chinese control of tyre giant

It comes as tensions between Beijing and the West are in focus as the US secretary of state visits China.

www.bbc.com

"Beijing-controlled chemical giant Sinochem is Pirelli's biggest shareholder, with a 37% stake in the 151-year-old Milan-based firm.

On Sunday, Pirelli said in a statement to investors that the Italian government had ruled that only Camfin - a company controlled by Pirelli's boss Marco Tronchetti Provera - could nominate candidates to be its chief executive. Pirelli also said the government had decided that any changes to the company's corporate governance should be subject to official scrutiny."

We will take your money but you will not have any control nor influence...but we will take your money.

 

[Fwiffo]

Turkey hikes interest rates as Erdogan stages economic U-turn

Turkey almost doubles its main rate, reversing one of President Erdogan's unorthodox economic policies.

www.bbc.com

I guess 10% inflation isn't so bad after all.

 

[Fwiffo]

Rep. George Santos’ $500K bond was guaranteed by his father and his aunt

Several media organizations, including NBCUniversal News Group, had requested that the court unseal the names of the bond guarantors, known as suretors.

www.nbcnews.com

Father and aunt. Were they also affected by Sept 11 or Jew-ish?

 

[Dropbear]

Rep. George Santos’ $500K bond was guaranteed by his father and his aunt

Several media organizations, including NBCUniversal News Group, had requested that the court unseal the names of the bond guarantors, known as suretors.

www.nbcnews.com

Father and aunt. Were they also affected by Sept 11 or Jew-ish?

Is that an eggplant suit with a red tie???

 

[Fwiffo]

Is that an eggplant suit with a red tie???

Ooops...wrong thread. Oh well.

 

[Fwiffo]

UBS ‘preparing to cut more than half of inherited Credit Suisse workforce’

Between 30,000 and 35,000 staff likely to leave combined group this year, according to report

www.theguardian.com

30,000-35,000.

"Credit Suisse offices in the capital are expected to be among of the worst hit as UBS seeks to protect operations in Switzerland. Senior executives, traders and thousands of support staff in New York and some parts of Asia are also expected to be told their positions are redundant, according to the report."

 

[Fwiffo]

Apple becomes first company to have a market cap topping $3 trillion

The news shows investors remain bullish on the stock and Apple’s portfolio of products and services, despite the company’s warning in May that its current quarter revenue is expected to fall about 3%.

www.nbcnews.com

“In our opinion the Street has severely underestimated the massive installed base upgrade opportunity around iPhone 14 and now a mini super cycle iPhone 15 ahead with roughly 25% of Apple’s golden customer base not upgrading their iPhones in over 4 years,”

Get those iPhones upgraded.

 

[Fwiffo]

Elon Musk: Tesla delivers record number of cars after price cuts

The electric carmaker has lowered prices of vehicles in countries including the US, UK and China.

www.bbc.com

"At the time Tesla said that its overall revenue had risen by almost a quarter in the first quarter from a year ago, as car sales increased."

Hurray! The genius of Elon Musk.

"However, its profit for the same period dropped by 24%, because of price cuts and higher costs of raw materials and other commodities."

Ohh....okay.

 

[Fwiffo]

US jobs growth weakest in more than two years

Employers add 209,000 jobs in June, a sign higher borrowing costs may be beginning to bite.

www.bbc.com

"That was fewer than expected, though the unemployment rate still fell to 3.6%, down from 3.7% in May."

Jobs aplenty. Come on in migrants.

 

[belinmad]

US jobs growth weakest in more than two years

Employers add 209,000 jobs in June, a sign higher borrowing costs may be beginning to bite.

www.bbc.com

"That was fewer than expected, though the unemployment rate still fell to 3.6%, down from 3.7% in May."

Jobs aplenty. Come on in migrants.

Notice: Data not available: U.S. Bureau of Labor Statistics

data.bls.gov

 

[Fwiffo]

Federal Reserve credits Taylor Swift with boosting hotel revenues through her blockbuster Eras Tour

“Taylor Swift is a force to be reckoned with,” one local tourism official said, as the pop superstar draws legions of fans nationwide.

www.nbcnews.com

Swifties - the saviours of the number one economy in the world.

 

[Fwiffo]

China reports second-quarter GDP miss, another record high in youth unemployment

Gross domestic product in the world’s second-largest economy was higher over the same period last year, but growth has slowed compared with the first quarter.

www.nbcnews.com

"The unemployment rate among young people ages 16 to 24 was 21.3% in June, a new record.

The 6.3% GDP print for the second quarter marked a 0.8% pace of growth from the first quarter, slower than the 2.2% quarter-on-quarter pace recorded in the first three months of the year. Analysts polled by Reuters had predicted a 7.3% increase in the second-quarter GDP."

Trouble in the second largest economy in the world.

 

[Fwiffo]

Chinese property developer Evergrande posts $81 billion loss over the past two years

The company fell into default in 2021 and announced an offshore debt restructuring program in March, having struggled to finish projects and repay suppliers and lenders.

www.nbcnews.com

"China Evergrande Group posted a combined loss of $81 billion in its long overdue earnings report late on Monday.

Evergrande’s net losses for 2021 and 2022 were 476 billion yuan ($66.36 billion) and 105.9 billion yuan ($14.76 billion), respectively, as a result of writedowns of properties, return of lands, losses on financial assets and financing costs, the company said."

I wonder how many years you will need to wait for the 2023 earnings to come out. It must be fun to be in Finance there working 3 fiscal years simultaneously.

 

[Grand Potentate]

Toronto’s rent crisis: Minimum wage would have to hit $40 an hour for workers to be able to afford to live here, report finds

Economic think tank report says the minimum wage needs to be $33.60 an hour for a worker to afford a one-bedroom apartment in Toronto — $40 an hour for a two-bedroom apartment

www.thestar.com

 

[Fwiffo]

Toronto’s rent crisis: Minimum wage would have to hit $40 an hour for workers to be able to afford to live here, report finds

Economic think tank report says the minimum wage needs to be $33.60 an hour for a worker to afford a one-bedroom apartment in Toronto — $40 an hour for a two-bedroom apartment

www.thestar.com

You can always commute 1 1/2 to 2 hours each way to find a cheaper place and still work at your $15/hour job.

 

[Fwiffo]

Federal Reserve raises key interest rate to highest level in more than 20 years

Fed Chair Jerome Powell affirmed Wednesday that central bank staffers no longer expect a recession to occur as a result of the rate hikes.

www.nbcnews.com

"'...and the reason is — one explanation for it is — that labor costs are really the biggest factor by far in most parts of that sector.'

Of course, higher pay is good for workers — and for the first time in the post-pandemic period, data showed inflation-adjusted wages outpacing inflation.

But a rapidly rising pace of wage increases concerns the Fed because it is linked to higher inflation. Businesses will raise prices if they believe their customers have more money to spend."

Stop paying the people so much...

 

[Fwiffo]

Bud Light maker Anheuser-Busch to lay off hundreds of employees, company says

Bud Light recently lost its status as the top-selling beer in America following fallout over a campaign featuring a trans influencer.

www.nbcnews.com

I wonder what the people who were made redundant think of trans people.

 

[Fwiffo]

Heineken CEO on Bud Light campaign fallout: ‘You need to stand for your values’

Heineken CEO Dolf van den Brink told CNBC that “polarization in society” was affecting businesses and brands after its rival AB InBev faced a boycott of its Bud Light brand.

www.nbcnews.com

If you keep standing for your values, my market share increases.

 

[Fwiffo]

Fitch downgrades U.S. credit rating from top score after debt ceiling crisis

The move, from a top rating of AAA to AA+, comes two months after the debt ceiling crisis was resolved and more than a decade after the federal government’s first-ever downgrade in the wake of the financial crisis.

www.nbcnews.com

“The repeated debt-limit political standoffs and last-minute resolutions have eroded confidence in fiscal management,”

Yes. It's the political theatre and last minute deadlines that are the issue. Not the fact there is a persistent deficit that requires raising the debt limit in the first place.

 

[Fwiffo]

The U.S. economy added 187,000 jobs in July, fewer than expected

The unemployment rate was 3.5%.

www.nbcnews.com

"Average hourly earnings, a key figure as the Federal Reserve fights inflation, rose 0.4% for the month, good for a 4.4% annual pace. Both numbers were higher than the respective estimates for 0.3% and 4.2%."

Raises are bad for inflation.

 

[Fwiffo]

Cost of living: Beyond Meat hit as inflation squeezes shoppers

The vegan food firm's revenues fell by 30.5% as inflation impacts household budgets.

www.bbc.com

Fake meat that is more expensive than meat? I'll go for the cheaper fatty ground beef and die early so I can afford my iPhone 16.

 

[Fwiffo]

Deflation: Why falling prices in China raise concerns

The world's second largest economy has slipped into deflation for the first time in more than two years.

www.bbc.com

"On Tuesday, official figures showed that China's exports fell by 14.5% in July compared with a year earlier, while imports dropped 12.4%. The grim trade data reinforces concerns that the country's economic growth could slow further this year."

Weren't they still projecting a 5%+ growth this year?

 

[Fwiffo]

WeWork, once valued at $40 billion, warns of possible bankruptcy as it submits 'going concern' notice

The company’s stock price has been trading below $1 since early this year.

www.nbcnews.com

I thought they fixed this by kicking out the founders and then right-sizing their portfolio. They just opened another location right in the middle of the financial district here in what used to be a Fedex/Kinko's place that ended up being a series of pop ups.

 

[Fwiffo]

Disney posts mixed results for quarter plagued by streaming woes, restructuring costs

Subscriber losses continued over the last three months, with the company reporting 146.1 million Disney+ subscribers, a 7.4% decline.

www.cnbc.com

"Subscriber losses continued over the last three months, with the company reporting 146.1 million Disney+ subscribers during the most recent quarter, a 7.4% decline from the previous quarter and a larger loss than Wall Street expected. The majority of subscriber losses came from Disney+ Hotstar, where the company saw a 24% drop in users after it lost out on the rights to Indian Premier League cricket matches.

Facing dwindling users and falling revenue in its media and entertainment distribution segment, Disney announced Wednesday it would raise the price on its ad-free streaming tier in October and that it would crack down on password sharing, as streaming rival Netflix did earlier this year."

Okay so even Disney is losing streaming subscribers which experienced peak growth when everyone had to sit at home.

I can understand how it's useful to entertain kids with an endless library of cartoons but even with the Fox library and their own library of classic dramas, comedies, etc. - what is the business model here? Netflix has realised coming out with 300 new productions a year of which 50% was Hallmark levels of mediocre is not going to keep people subscribed when there are better things "in real life" to do than sit in front of a screen. Deep archive libraries of content which was why every media company broke off on their own won't keep people hooked either.

The streaming market has reached a saturation point and some entrants will need to drop out (probably not Disney) for it to be sustainable for the handful of companies that remain. Unless you're Amazon where you're minting money selling toilet paper online it's becoming an unlimited money pit for media companies.

I was not surprised streaming only entities like Netflix had to figure this out the hard way. I'm doubly surprised a traditional media company which has gone through this type of cannibalization on cable/satellite/broadcast TV journeys are falling on to the same trap.

 

[Fwiffo]

Russia hikes interest rates to 12% as rouble falls

The Bank of Russia raises rates sharply in an attempt to boost the currency and lower inflation.

www.bbc.com

Time to get some high interest savings going with your rouble.

 

[Fwiffo]

China halts youth jobless data as economy falters

The country's central bank also unexpectedly cut key interest rates as it tries to boost the economy.

www.bbc.com

There aren't any jobless youths to report. Full employment.

 

[Fwiffo]

Global wealth projected to rise 38% by 2027, despite recent decline - study

Global wealth, as measured in personal holdings of assets from real estate to stocks and shares, is projected to rise 38% by 2027, driven largely by emerging markets, a study published by Credit Suisse and UBS showed on Tuesday.

www.reuters.com

"The largest wealth increases last year were recorded for Russia, Mexico, India and Brazil. The report forecast wealth in emerging economies, including the BRICS countries - Brazil, Russia, India, China and South Africa - will rise 30% by 2027."

I thought some of those countries were facing sanctions....

 

[Fwiffo]

Pride Month backlash hurt Target’s sales. They fell for the first time in six years

Pride doesn't pay.

 

[Fwiffo]

China cuts key interest rate as recovery falters

The world's second largest economy struggles to recover from Covid and faces a property crisis.

www.bbc.com

"Around 70% of young people in China now go to university and so expect to get a white-collar job afterwards. They want desk jobs, staring at computers. But that's not possible."

 

[Fwiffo]

The 30-year mortgage rate hits 7.48%, the highest level since 2000

Mortgage interest rates have nearly tripled in the span of just a couple of years amid inflation fears and strong economic growth.

www.nbcnews.com

10% here we come.

 

[Fwiffo]

S&P downgrades multiple U.S. banks on growing liquidity worries

The company says higher funding costs and troubles in the commercial real estate sector will likely test the credit strength of lenders.

www.nbcnews.com

Another bank run on the way?

 

[Fwiffo]

Heineken sells off Russian beer business for €1

The lager-maker will take a huge loss on the division which, it said, had taken longer to jettison.

www.bbc.com

BT, Lacoste, Unilever still going strong.

 

[Fwiffo]

Kleenex maker says famous tissues to be wiped out of Canada soon, citing 'unique complexities'

The descent of this country into 20th century communism continues.

 

[Fwiffo]

U.S. labor market loses steam as job openings, resignations decline

Data released Tuesday showed the number of people quitting their jobs fell to levels not seen since 2021, indicating Americans are less confident in the labor market.

www.nbcnews.com

This can't be good for incumbent governments.

 

[Fwiffo]

U.S. economic growth for last quarter is revised down to a 2.1% annual rate

Growth last quarter was driven by upticks in consumer spending, business investment and outlays by state and local governments.

www.nbcnews.com

Keep the rate increases coming...

 

[Fwiffo]

Disney’s wildest ride: Iger, Chapek and the making of an epic succession mess

Bob Chapek confided to a friend that his tenure at Disney was “about three years of hell,” defined by one overriding theme: his unrelenting fear that Bob Iger wanted his job back.

www.nbcnews.com

A long read but a scathing expose if you are the boss and you are leaving, you need to know when it's time to go. For the new boss, bringing in your own crew and confidant is essential. Trust and loyalty above all.

"However, Chapek saw two major problems with the streaming operation. First, he believed there were too many people making decisions about what content was slated for Disney+. Iger and Mayer had tasked this responsibility to Agnes Chu, senior vice president of content, and Ricky Strauss, president of content and marketing for Disney+. Both Chu and Strauss have since left Disney.

Others wanted a say, including Mayer, Chu and Strauss’s boss, as well as Marvel Studios President Kevin Feige, Lucasfilm head Kathleen Kennedy, and the heads of Walt Disney Television and Walt Disney Studios. Mayer told Chapek the structure was messy and needed fixing."

"Chapek brought a business school mentality to this challenge, which naturally rubbed creative executives the wrong way. He often cited the concept of ARCI — which stands for 'accountable, responsible, consulted and informed' — as a framework for ensuring clear decision-making structures. Chapek would often say, 'Who’s got the A?' — referring to accountability. With streaming, the answer wasn’t clear."

That explains why the Disney+ library is a bit of a mess. Things you think they ought to have aren't there and shows/movies often seem like they're hidden.

 

[Fwiffo]

Toronto restaurants see double-digit decline in people dining in, suggesting pullback in discretionary spending

The volume of seated diners at restaurants in the city has been declining year-over-year since June, according to OpenTable data.

www.thestar.com

I'm probably 1% of this decline.

I hope OpenTable is still running. I have a few hundred points before I get to the next milestone and I can redeem an OpenTable cheque.