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☆ Union fights grow US workers’ slice of profit pie
▼ + stars: | 2023-08-18 | by ( Ben Winck | ) www.reuters.com time to read: +4 min

Strong demand for workers has given organized workers a stronger hand at the bargaining table. The United Steel Workers union has asserted itself aggressively in a bidding battle for U.S. Steel (X.N). Corporate profit is 30% above its pre-crisis high, at $2.7 trillion, according to the U.S. Bureau of Economic Analysis. With organized workers showing clout, they’ll be able to pull some more profit their way. Trucking company Yellow filed for Chapter 11 bankruptcy protection on Aug. 7 after halting operations the week prior.

Persons: Darren Hawkins, they’ll, . Steel, “, Carole Tome, Lauren Silva Laughlin, Sharon Lam Organizations: Reuters, U.S, Workers, Economic, United Parcel Service, United Steel Workers, U.S . Steel, UPS, Teamsters, U.S . Bureau, Reuters Graphics Reuters, ., Trucking, International Brotherhood of Teamsters, Thomson Locations: Cleveland, U.S

☆ American price elasticity stretched to the limit
▼ + stars: | 2023-08-10 | by ( Ben Winck | ) www.reuters.com time to read: +3 min

WASHINGTON, Aug 10 (Reuters Breakingviews) - The United States may be over the hump on inflation, but consumers aren’t acting like it. Lingering restraint will stretch the power of price elasticity to its limits. Similarly, PepsiCo’s (PEP.O) 14% increase in North American prices of Mountain Dew, Tropicana orange juice and other beverages cost it 4% in quarterly sales. Strong appetites for Oreos and Wheat Thins lifted Mondelez International’s (MDLZ.O) sales 2% in the United States, Canada and Mexico, even as prices climbed 10%. They have climbed 3.5% from a year earlier, surpassing the 3.2% annual increase in the Consumer Price Index.

Persons: Mondelez, Darden, Ricardo Cardenas, Laxman Narasimhan, Marriott, Jeffrey Goldfarb, Aditya Sriwatsav Organizations: Reuters, of Michigan, U.S . Bureau of Labor Statistics, Capital, Procter & Gamble, Delta Air Lines, United Airlines, Reuters Graphics Reuters, U.S, of Labor Statistics, Thomson Locations: States, Dew, United States, Canada, Mexico, American

☆ America’s new China curbs eschew scale for smarts
▼ + stars: | 2023-08-10 | by ( Ben Winck | ) www.reuters.com time to read: +4 min

The White House on Wednesday took the wraps off its proposal for screening investments U.S.-based funds make abroad, giving President Joe Biden a new tool for “de-risking” from China. But while the government’s inbound-investment reviews have often proven onerous, the pitch for outbound screening should placate investors and even diplomats. If recipients boast close ties to Chinese military or intelligence capabilities, the department could then block the transaction. Follow @BenWinck on TwitterCONTEXT NEWSU.S. President Joe Biden on Aug. 9 issued an executive order that tasks the Treasury Department with forming an outbound investment screening program. In response to the executive order the Treasury Department issued an Advanced Notice of Proposed Rulemaking seeking comment on the program.

Persons: Joe Biden, Jonathan Ernst, Janet Yellen’s, Antony Currie, Katrina Hamlin Organizations: Auburn Manufacturing, REUTERS, Reuters, Washington, Wednesday, Biden, Regulators, Treasury, Department, Treasury Department, Thomson Locations: U.S, Auburn , Maine, WASHINGTON, China, Washington

☆ Next job-market challenge: the Great Unresignation
▼ + stars: | 2023-08-04 | by ( Ben Winck | ) www.reuters.com time to read: +4 min

The U.S. economy has weathered inflation without widespread layoffs so far, but a Great Unresignation could make seemingly healthy job numbers harder to read. But a big input in firms’ hiring plans is “attrition” – the number of workers expected to quit. The so-called quit rate in the finance and insurance sector dropped to 1.1%, well below a peak of 2.4% in April 2022. Wells Fargo flagged “slower than expected” attrition as a driver of higher severance costs during the bank’s July 14 earnings call. The U.S. economy added 187,000 nonfarm payrolls in July, the Bureau of Labor Statistics said on Aug. 4.

Persons: haven’t, Wells, That's, –, John Foley, Sharon Lam Organizations: Reuters, Wall, Bureau of Labor Statistics, Companies, of Labor Statistics, Citigroup, payrolls, Thomson Locations: U.S, United States

☆ Robinhood swaps meme-green tights for duller look
▼ + stars: | 2023-08-03 | by ( ) www.reuters.com time to read: +2 min

Robinhood logo is seen on a smartphone in front of a displayed stock graph in this illustration taken, July 2, 2021. REUTERS/Dado Ruvic/NEW YORK, Aug 3 (Reuters Breakingviews) - Robinhood Markets (HOOD.O) is looking more grown-up - and more boring. The problem: Users are still fleeing, and nearly half of revenue comes from interest that is destined to fade. Robinhood warned last quarter that a 100 basis-point drop in interest rates would lead to a hit equivalent to an 11% fall in revenue. When the Federal Reserve eventually turns to cutting rates, Robinhood will need more users to fill that hole.

Persons: Dado Ruvic, Vlad Tenev, ” That’s, Robinhood, Ben Winck, Jonathan Guilford, Sharon Lam Organizations: REUTERS, Reuters, Stock, Federal Reserve, Twitter, Adidas, InBev, Thomson

☆ One-two punch barely fazes Uncle Sam
▼ + stars: | 2023-08-02 | by ( Ben Winck | ) www.reuters.com time to read: +4 min

Former U.S. President and Republican presidential candidate Donald Trump speaks at a campaign event in Council Bluffs, Iowa, U.S., July 7, 2023. Fitch Ratings knocked the U.S. government from its perfect AAA grade, becoming the second major ratings agency to demote the country’s debt. Just minutes later, Donald Trump was indicted for his attempts to overturn the 2020 election. Yet despite the latest one-two punch, a resilient economy and the dollar’s global standing make it hard to bet against Uncle Sam. Former U.S. president Donald Trump was indicted on Aug. 1 for his sweeping efforts to overturn the results of the 2020 presidential election.

Persons: Donald Trump, George Washington’s “, It’s, Treasury Department ., Uncle Sam, Trump, Peter Thal Larsen, Sharon Lam Organizations: U.S, Republican, Reuters, Fitch, AAA, Bank for International, Treasury Department, Treasury Department . Fitch reckons, Former U.S, Trump, Thomson Locations: Bluffs , Iowa, U.S, WASHINGTON, Washington, American

☆ Republicans struggle to diverge from Bidenomics
▼ + stars: | 2023-08-01 | by ( Ben Winck | ) www.reuters.com time to read: +4 min

Florida Governor and Republican U.S. presidential candidate Ron DeSantis attends a barbecue hosted by former diplomat Scott Brown, as part of his "No B.S. WASHINGTON, Aug 1 (Reuters Breakingviews) - Republicans with ambitions to move into the White House have a love-hate relationship with Bidenomics. A continued push for true “energy independence” probably would look more like Biden’s strategy than anything else. The agenda includes 10 core tenets, including greater independence from China, energy independence and promoting domestic investment. He called for “aggressive new restrictions” on Chinese ownership of U.S. infrastructure in a Jan. 18 campaign video and emphasized domestic energy independence in a Feb. 9 video.

Persons: Ron DeSantis, Scott Brown, Bidenomics, Donald Trump, Joe Biden’s, DeSantis, “, Biden, Trump, ”, Jeffrey Goldfarb, Sharon Lam Organizations: Republican U.S, Reuters, Economic, Federal Reserve, Trump, Energy Information Administration, “, Florida, Former U.S, Thomson Locations: Florida, Rye , New Hampshire, U.S, WASHINGTON, ”, Ukraine, Beijing, China, Bidenomics, New Hampshire

☆ Big Tech super regulator would be a super dud
▼ + stars: | 2023-07-27 | by ( Ben Winck | ) www.reuters.com time to read: +3 min

WASHINGTON, July 27 (Reuters Breakingviews) - Two U.S. lawmakers have an idea for reining in Big Tech: get someone else to do it. They include protecting young users of social media, and countering anticompetitive behavior. A new watchdog that sets out to safeguard young users would overlap with some of the Federal Communications Commission’s duties. Instead of spending time and taxpayer dollars on a super-regulator, lawmakers would do better to get their act together, and face Big Tech themselves. The proposal, introduced in the Senate on July 27, would set new rules for tech mergers, data security, and safeguards for young users, according to the essay.

Persons: Elizabeth Warren, Lindsey Graham, Warren, Barack Obama’s, Donald Trump, Joe Biden, Rohit Chopra, John Foley, Sharon Lam Organizations: Reuters, Big Tech, Democratic, Republican, Digital Consumer Protection, of Justice, Federal Trade Commission, Federal Communications, Consumer Financial Protection Bureau, Democratic U.S, New York Times, Thomson

☆ Big Tech super-regulator would be a super-dud
▼ + stars: | 2023-07-27 | by ( Ben Winck | ) www.reuters.com time to read: +3 min

Persons: Elizabeth Warren, Lindsay Graham, Warren, Barack Obama’s, Donald Trump, Joe Biden, Rohit Chopra, John Foley, Sharon Lam Organizations: Reuters, Big Tech, Democratic, Digital Consumer Protection, of Justice, Federal Trade Commission, Federal Communications, Consumer Financial Protection Bureau, Democratic U.S, New York Times, Thomson

Both theory and past practice suggest that higher interest rates weigh on investment and consumption, crimping companies’ profit and forcing them to reduce hiring or lay off staff. It could also be that higher interest rates weigh on prices by pushing up borrowing costs and weakening financial markets, without requiring widespread layoffs. But economic forecasters have wrongly anticipated layoffs and higher unemployment for much of the past year. Until disinflation becomes less immaculate, the central bank has the unholy problem of choosing between lessons from history and those of the last 12 months. The U.S. unemployment rate dipped to 3.6% in June, the BLS announced on July 7.

Persons: Jerome Powell, Donald Trump, Joe Biden, Powell, There’s, Ben Winck, Francesco Guerrera, Peter Thal Larsen, Sharon Lam, Streisand Neto Organizations: Reuters, Federal Reserve, Wall, U.S, Fed, UBS –, Bank of International, Workers, United, Refinitiv, Consumer, of Labor Statistics, BLS, Thomson Locations: U.S, United States, payrolls, Washington, London

☆ US job market’s shifting balance
▼ + stars: | 2023-07-07 | by ( ) www.reuters.com time to read: +2 min

NEW YORK, July 7 (Reuters Breakingviews) - Quitting doesn’t pay like it used to. The raises Americans earn from switching jobs is shrinking, narrowing their advantage in wage gains versus job-keepers. While it’s happened without mass layoffs, weaker pay gains signal that the labor market’s balance of power is shifting back to businesses. And although job creation is gently slowing, government data released Friday showed unemployment dipping to 3.6% in June, nearly matching a five-decade low. That’s a welcome sign for workers after economists’ forecasts suggested millions would have to lose their jobs for inflation to cool.

Persons: Ben Winck, Jonathan Guilford, Sharon Lam Organizations: YORK, Reuters, Reuters Graphics Reuters, Twitter, Thomson Locations: U.S

☆ Supreme Court knocks Fed diversity goal down a peg
▼ + stars: | 2023-07-05 | by ( ) www.reuters.com time to read: +2 min

WASHINGTON, July 5 (Reuters Breakingviews) - The U.S. Supreme Court just made the Federal Reserve’s job more difficult. The ruling could make future workforces more homogeneous and, in turn, throws a new obstacle in the way of the Fed’s goal for diverse employment. Getting that back to 2% from the current 4% pace remains the central bank’s “top priority,” Powell said last month. While white unemployment hit 3.3% in May, Black unemployment rebounded to 5.6%, according to the Bureau of Labor Statistics. As Powell moves further away from his goal of inclusivity, the Supreme Court’s decision means closing that gap will probably take even longer.

Persons: Jerome Powell, it’s, ” Powell, Powell, Ben Winck, Lauren Silva Laughlin, Sharon Lam Organizations: Reuters, U.S, Supreme, Bureau of Labor Statistics, inclusivity, Twitter, KKR, Thomson Locations: China

☆ Breakingviews: Student-loan ruling offers Econ 101 crash course
▼ + stars: | 2023-06-30 | by ( Ben Winck | ) www.reuters.com time to read: +4 min

A U.S. Supreme Court ruling against President Joe Biden’s student loan forbearance erases as much as $20,000 in potential relief for graduates. Combined with the resumption of debt payments, borrowers will be feeling the pinch in their wallets and their confidence. Had Biden’s policy covered $10,000 of their debt, the typical monthly payment would have shrunk by about a quarter. If the Supreme Court had supported the relief, it also risked stoking inflation just as it slides to a healthier level. CONTEXT NEWSThe U.S. Supreme Court on June 30 ruled 6-3 against President Joe Biden’s plan to forgive student loan debt for some 43 million borrowers.

Persons: Joe Biden’s, Mark Zandi, Taco, Pell Grant, Donald Trump, Jeffrey Goldfarb, Streisand Neto Organizations: Reuters, U.S, Supreme, White, Census Bureau, U.S . Federal Reserve, Bureau of Labor Statistics, Taco Bell, Yum Brands, Biden, Twitter, Democratic, Congressional, Office, Former U.S, Thomson

☆ Resetting student loans brings Econ 101 lessons
▼ + stars: | 2023-06-30 | by ( Ben Winck | ) www.reuters.com time to read: +3 min

A U.S. Supreme Court ruling against President Joe Biden’s student loan forbearance erases as much as $20,000 in potential relief for graduates. Combined with the resumption of debt payments, borrowers will be feeling the pinch in their wallets and their confidence. The court said on Friday that a plan to wipe out swathes of student loans was unconstitutional, ending hopes of an easier financial future for some 43 million borrowers. If the Supreme Court had supported the relief, it also risked stoking inflation just as it slides to a healthier level. The proposal aimed to relieve $10,000 of student loans for individuals earning less than $125,000 annually, and an additional $10,000 for eligible borrowers who received Pell Grant subsidies.

Persons: Joe Biden’s, Mark Zandi, Taco, Pell Grant, Donald Trump, Jeffrey Goldfarb, Streisand Neto Organizations: Reuters, U.S, Supreme, White, Census Bureau, U.S . Federal Reserve, Bureau of Labor Statistics, Taco Bell, Yum Brands, Biden, Democratic, Congressional, Office, Former U.S, Thomson

☆ Corporate boycotts clash with political reality
▼ + stars: | 2023-06-15 | by ( ) www.reuters.com time to read: +2 min

WASHINGTON, June 15 (Reuters Breakingviews) - Republicans are firing from the hip when it comes to corporate boycotts. Conservative Americans’ changing beer habits may have contributed to Bud Light being pulled from its spot as the number one beer in the United States for the first time in more than two decades. In May, Bud Light sales dropped a quarter compared to the same month last year, consulting companies Bump Williams and NielsenIQ said Wednesday. As conservatives encourage consumption based on political views, they may in some cases pull cash from their own pockets. They do not reflect the views of Reuters News, which, under the Trust Principles, is committed to integrity, independence, and freedom from bias.

Persons: Bud Light, Marjorie Taylor Greene, Ted Cruz, Marsha Blackburn of, Busch, influencer Dylan Mulvaney, Bud, Bump Williams, NielsenIQ, Ben Winck, Lauren Silva Laughlin, Streisand Neto Organizations: Reuters, Conservative, Republican, Anheuser, Bud Light, Democratic, Constellation Brands, Target, Twitter, Thomson Locations: United States, Marjorie Taylor Greene of Georgia, Ted Cruz of Texas, Marsha Blackburn of Tennessee

☆ Fed’s rate hike habit will be hard to kick: podcast
▼ + stars: | 2023-06-13 | by ( Ben Winck | ) www.reuters.com time to read: 1 min

WASHINGTON, June 13 (Reuters Breakingviews) - The US central bank is mulling a pause after raising interest rates at its last 10 meetings. In this Exchange podcast, Morgan Stanley chief economist Seth Carpenter lays out the calculus behind the Federal Reserve’s next move, and why it’s so hard for policymakers to pivot. Listen to the podcastFollow @BenWinck on TwitterSubscribe to Breakingviews’ podcasts, Viewsroom and The Exchange. The opinions expressed are his own)Editing by Aimee Donnellan and Katrina HamlinOur Standards: The Thomson Reuters Trust Principles. They do not reflect the views of Reuters News, which, under the Trust Principles, is committed to integrity, independence, and freedom from bias.

Persons: Morgan Stanley, Seth Carpenter, Aimee Donnellan, Katrina Hamlin Organizations: Reuters, Federal, Twitter, Thomson

☆ Treasury buyers live for the moment, unfortunately
▼ + stars: | 2023-06-01 | by ( Ben Winck | ) www.reuters.com time to read: +4 min

The bill to suspend the so-called debt ceiling, approved by the House of Representatives on Wednesday, solves the most immediate threat to the government’s creditors. The Federal Reserve’s fight against inflation also stands to knock Treasury prices, while pushing up yields. Spending caps and other measures in the debt ceiling deal are projected to save $1.5 trillion over the next decade, the Congressional Budget Office said Tuesday. Treasury Secretary Janet Yellen warned on May 26 that the federal government would be unable to pay its bills on June 5. The U.S. House of Representatives voted 314-117 on May 31 to suspend the debt ceiling, a legislative cap on how much the Treasury can borrow that had been set at $31.4 trillion.

Persons: Goldman Sachs, That’s, Sam, Janet Yellen, Joe Biden’s, John Foley, Sharon Lam, Streisand Neto Organizations: Reuters, Treasury, Reuters Graphics Reuters, Refinitiv, Congressional, U.S . Congress, U.S . House, Senate, U.S, Treasury Department, Thomson Locations: Treasuries, U.S, Washington

☆ Debt deal sacrifices $140 bln return on investment
▼ + stars: | 2023-05-31 | by ( ) www.reuters.com time to read: +2 min

The budget deal agreed to by President Joe Biden and top congressional Republican Kevin McCarthy would move $20 billion away from the Internal Revenue Service over the next two years. The change shores up cash for other agencies, but projections suggest the IRS funding would’ve made a significant step toward closing the government’s $925 billion budget gap. Biden approved $80 billion of new cash for the IRS in 2021, arguing the funding would strengthen enforcement and increase revenue collected by Uncle Sam. The CBO estimated in 2021 that for every $1 increase to IRS funding the government would recoup $6.40 to $7.10. The $20 billion being diverted from the agency could therefore raise as much as $142 billion through 2031.

Persons: Joe Biden, Kevin McCarthy, would’ve, Biden, Uncle Sam, Ben Winck, Lauren Silva Laughlin, Sharon Lam Organizations: Reuters, U.S, Internal Revenue Service, Office, CBO, IRS, White, Twitter, Toyota, Lufthansa, Thomson Locations: Saudi, East, Italy

☆ Breakingviews: Biden gives little, gets less in debt ceiling deal
▼ + stars: | 2023-05-28 | by ( Ben Winck | ) www.reuters.com time to read: +4 min

WASHINGTON, May 28 (Reuters Breakingviews) - For President Joe Biden, a debt-ceiling victory comes with a bittersweet taste. The White House and top congressional Republican Kevin McCarthy reached a tentative deal for lifting the government’s borrowing limit on Saturday night. After months of negotiation, Biden and McCarthy reached an agreement just nine days before U.S. Treasury Secretary Janet Yellen said the country was expected to run out of cash. The deal lifts the debt ceiling about $4 trillion from its current level of $31.4 trillion, extending the government’s borrowing power for two more years. Follow @BenWinck on TwitterCONTEXT NEWSThe Biden administration and top congressional Republican Kevin McCarthy reached an agreement in principle on May 27 for raising the U.S. government’s debt ceiling.

☆ Supreme Court gifts Big Tech best kind of boring
▼ + stars: | 2023-05-19 | by ( ) www.reuters.com time to read: +2 min

WASHINGTON, May 19 (Reuters Breakingviews) - American tech giants have two new things to celebrate, and one less thing to worry about. The U.S. Supreme Court on Thursday unanimously protected Twitter from being sued for militant-group content on its platform. Together, the rulings reinforce internet platforms’ legal shield and kick a regulatory crackdown further down the road. With the Supreme Court siding in their favor, Big Tech can breathe a sigh of relief. The Supreme Court ruling leaves that debate stuck in Congress, exactly where tech giants want it.

☆ Debt-ceiling talks are more theater than substance
▼ + stars: | 2023-05-16 | by ( Ben Winck | ) www.reuters.com time to read: +3 min

U.S. President Joe Biden will meet with congressional leaders including House Speaker Kevin McCarthy on Tuesday to attempt to make progress on talks to raise the debt ceiling. The two efforts would raise $33 billion over the next decade, the Congressional Budget Office estimated last month. Biden also signaled openness to a two-year limit on government spending, Roll Call reported last week, which would raise an estimated $331 billion. loadingComing to terms on these pieces likely means both sides agree to raise the debt limit and push a new budget through. Failure to raise the debt ceiling could leave the government unable to pay its bills and trigger a historic sovereign default.

☆ Gig work value is too great to rush a US overhaul
▼ + stars: | 2023-05-11 | by ( Ben Winck | ) www.reuters.com time to read: +4 min

Julie Su, the president’s choice for labor secretary, has a history of redefining gig work. And while health insurance and retirement savings are valuable perks, gig workers view flexibility in the same way. Half of surveyed gig workers, meanwhile, make less than a quarter of their income from freelancing. Gig work has also grown alongside traditional employment, not at its expense. With most gig workers happy as they are, a one-size-fits-all rethink threatens pointless harm to a growing corner of the economy.

Congress is sparring again over raising the debt ceiling, and time is running out to avoid a default. Here's what the debt ceiling is and why it's so dangerous for the US economy. If that sounds familiar, you already know a fair deal about the "debt ceiling." The debt ceiling was introduced in 1917 to encourage the government to slow its borrowing. McCarthy and his GOP colleagues have been adamant that any debt ceiling raise should be tied to their own priorities, particularly in the form of spending cuts.

☆ Cool investors buy time for First Republic fix
▼ + stars: | 2023-04-28 | by ( ) www.reuters.com time to read: +1 min

NEW YORK, April 28 (Reuters Breakingviews) - If investors are worried that stresses at First Republic Bank (FRC.N) will hurt other lenders, they aren’t showing it. Stocks of regional U.S. banks are generally faring well despite fears that the San Francisco-based lender might fail. As the government and the private sector mull a rescue, the market’s composure buys precious time for reaching a deal. The difference between now and March, when Silicon Valley Bank and Signature Bank crumpled, is marked. Regional Bank exchange-traded fund (IAT.P) closed with a 0.7% gain.

☆ US economy rides a shopping cart to nowhere
▼ + stars: | 2023-04-27 | by ( ) www.reuters.com time to read: +2 min

NEW YORK, April 27 (Reuters Breakingviews) - The American consumer held the U.S. economy afloat in the first quarter, driving an annualized GDP growth rate of 1.1% - less than expected though still enough to avoid recession. But the signs that shoppers are getting tired are already in plain sight. Consumption added 2.5 percentage points to GDP growth, which is close to levels seen in the past. Spending by American households counts for 70% of GDP – meaning shoppers effectively decide whether the U.S. economy is headed for recession or recovery. They do not reflect the views of Reuters News, which, under the Trust Principles, is committed to integrity, independence, and freedom from bias.

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