Economics

KEY POINTS

• 24 Exchange, a new stock exchange, announced Wednesday that it will launch next year.
• The exchange could eventually offer 23-hours-a-day stock trading, pending final regulatory approval.
• The 24X National Exchange will debut in the second half of 2025, with trading from 4:00 a.m. ET to 7:00 p.m. ET on weekdays, the Stamford, Connecticut-based platform said.

Summary

Small businesses are preparing for potential tariffs on imports from Mexico, Canada, and China by stockpiling inventory, negotiating with suppliers, and considering price increases.

Some businesses are exploring alternative suppliers or reducing product offerings to mitigate the impact of tariffs.

While some businesses see an opportunity to promote domestic production, others are concerned about the potential for increased costs and reduced profits.

Summary

Eurozone inflation rose to 2.3% in November, up from 2% in October, exceeding the European Central Bank’s (ECB) 2% target.

Core inflation remained steady at 2.7%, while energy prices dropped 1.9% but were offset by a 3.9% rise in services costs.

Despite the uptick, inflation is far below its 2022 peak of 10.6%.

Markets expect the ECB to cut interest rates by 0.25% in December, prioritizing economic growth over inflation control amid forecasts of modest GDP growth for 2023 (0.8%) and 2024 (1.3%).

Summary

Donald Trump plans to impose tariffs of 25% on imports from Canada and Mexico and 10% on China, targeting the U.S.’s largest trading partners.

Tariffs, taxes on imports, are paid by American companies and likely to raise consumer prices.

Trump aims to reduce the trade deficit and encourage domestic manufacturing, though experts argue such shifts are impractical in the short term.

Retaliation from affected countries is expected, potentially escalating a trade war.

Previous tariffs during Trump’s first term led to economic backlash, including higher inflation and costly bailouts for U.S. farmers.

Summary

Workers at a Whole Foods store in Philadelphia have filed for a union election, citing low pay, high workloads, and intense productivity demands.

Amazon, which acquired Whole Foods in 2017, has aggressively opposed unionization efforts and is challenging the constitutionality of the National Labor Relations Board.

The union drive comes as workers feel overworked and under pressure from management.

Summary

New research from the Transamerica Center for Retirement Studies shows most Americans retire earlier than planned, often due to health issues or job loss.

The median retirement age is 62, leaving many financially unprepared for decades of retirement as life expectancy increases.

This often leads to early Social Security claims, locking retirees into reduced benefits, with only 4% delaying until age 70 for maximum payouts.

Despite financial challenges, most retirees report high satisfaction, prioritizing freedom and relationships over financial independence.

Summary

Macy’s delayed its earnings report due to a single employee’s $132–$154 million in erroneous accounting entries for nearly three years.

Forensic investigation uncovered irregularities amid Macy’s broader financial struggles, with quarterly sales down 2.4% compared to 2023.

While Macy’s core stores face declining consumer spending, its Bloomingdale’s and Bluemercury brands show modest growth.

Macy’s also plans to close 150 stores by 2027, reducing its footprint to 350 locations.

His book with Michael. C. Klein, "All trade wars are class wars" is an excellent book I recommend anybody who wants to understand the persistent trade imbalances around the world and their impacts (low consumption in China, deindustrialisation and debt in America, etc.)

Summary

U.S. jobless claims dropped to 213,000 last week, near seven-month lows, but continuing claims rose to 1.91 million, the highest in three years, showing some workers are struggling to find jobs.

Layoffs remain low, but slower hiring suggests weakening labor demand.

The Federal Reserve, focusing on jobs over inflation, has cut interest rates multiple times this year.

Inflation is nearing the Fed’s 2% target, but recent job growth has slowed, with October adding just 12,000 jobs amid strikes and other disruptions.

> The Chinese yuan has plummeted since U.S. President-elect Donald Trump's victory, and finance experts are questioning why the Chinese government is not doing more to defend the currency.

Summary

Despite Trump’s pledge to lower gas prices by increasing oil production, energy companies prioritize profitability over pumping more oil.

US oil and gas companies have excess capacity and are focused on managing resources efficiently.

Even if oil producers increase production, refiners have limited capacity to process shale oil into gasoline, potentially increasing prices.

Summary

Boeing is issuing layoff notices to 17,000 employees, about 10% of its workforce, with job cuts effective in mid-January.

The layoffs follow a labor union strike that halted production of key aircraft like the 737 Max and 777s.

Boeing cited financial challenges and structural changes to remain competitive. The company also announced it will end 767 production by 2027 and delayed the 777X rollout to 2026 due to a defective part.

Boeing raised $24 billion to stabilize finances amid a turbulent year marked by safety concerns, production delays, and leadership changes.

Summary

General Motors is laying off around 1,000 white-collar employees globally to reduce costs and enhance efficiency amid challenges in transitioning to electric vehicles (EVs).

The layoffs, announced Friday, align with GM’s goal to cut $2 billion in fixed costs by year-end. GM has been balancing investment in EV development with updating gas-powered models.

U.S. EV sales grew 7.2% through September but remain slower than last year’s 47% surge.

This follows earlier voluntary buyouts of 5,000 employees in April, which GM previously said might prevent future layoffs.

Summary

The consumer price index rose to 2.6% in October, indicating a bumpy path towards lower inflation levels.

Despite a decline in inflation, many Americans remain under pressure due to years of price increases.

The Federal Reserve has cut interest rates to combat inflation, but the job is not yet complete.

Summary

Following Donald Trump’s election victory, proposed tariffs of 10%-20% on general imports and 60% on Chinese goods are raising concerns across the fashion, beauty, and footwear industries.

Companies like Steve Madden, Under Armour, and e.l.f Beauty are assessing impacts, with some, such as Steve Madden, planning to reduce reliance on Chinese suppliers.

Tariff fears have already affected retail stocks, and executives acknowledge the industry is now more prepared for trade disruptions.

Many brands, including Ralph Lauren and Tapestry, have diversified sourcing in anticipation of restrictive trade policies.

Summary

The average 30-year mortgage rate in the U.S. rose to 6.79%, marking its highest level since early July and continuing a six-week climb, according to Freddie Mac.

Rising rates, influenced by increased 10-year Treasury yields and expectations of economic growth under President-elect Donald Trump, are reducing purchasing power amid high home prices.

Mortgage applications have dropped for six consecutive weeks, with refinancing applications also down.

Experts expect continued volatility in mortgage rates as markets respond to election results and upcoming Federal Reserve policy decisions.

Summary

The Federal Reserve has lowered its key interest rate by a quarter point, marking progress toward its goals of low inflation and unemployment, with inflation returning to the target 2% level and unemployment at 4.1%.

However, President-elect Donald Trump's proposed economic policies, particularly his plan for expansive tariffs, could disrupt this stability.

Analysts warn that Trump’s $3 trillion tariff proposal may re-ignite inflation, potentially forcing the Fed to halt further rate cuts.

Although Trump favors low interest rates to drive growth, his inflationary policies may lead the Fed to act against his preferences.

Summary

Boeing factory workers in Seattle voted to accept a new contract, ending a 53-day strike that halted production of the company’s key airliner.

The deal, approved by 59% of voting union members, includes a 38% wage increase over four years, a $12,000 ratification bonus, and productivity incentives, though it does not restore a previously frozen pension plan.

The strike cost Boeing an estimated $50 million per day, exacerbating financial pressures. Boeing looks to resume production within weeks.

Summary

The average age of U.S. homebuyers has reached a record high of 56, as younger Americans face rising homeownership costs. The median age for first-time buyers rose to 38, with only 24% of buyers being first-timers—the lowest share since 1981.

High home prices, averaging $435,000, and increased mortgage rates make saving for down payments nearly impossible for many younger buyers, who often lack wealth or home equity to compete with older, wealthier bidders.

With all-cash buyers now representing 26% of purchases, many young buyers rely on family gifts or loans.

Summary

With inflation near target, the Federal Reserve, led by Jerome Powell, is set to cut its benchmark rate by a quarter-point, to about 4.6%, its second reduction this year.

Despite low unemployment and strong growth, the Fed seeks to recalibrate after previous rate hikes. Economists support gradual cuts but debate the “neutral” rate that sustains growth without restriction.

A Trump presidency and proposed tariffs could reignite inflation, potentially prompting the Fed to adjust its approach.

Summary

TGI Fridays filed for Chapter 11 bankruptcy. The once-popular sit-down restaurant has faced declining customer interest, reflecting a broader trend impacting casual dining. With just 163 U.S. locations—down from 269 last year—the chain has closed numerous outlets and seen U.S. sales drop to $728 million in 2023. While TGI Fridays operates only 39 U.S. locations directly, global franchised locations remain unaffected, with independent operators managing 461 restaurants across 41 countries under a separate franchising entity.

Summary: Boeing machinists’ union leadership endorses the latest contract proposal, which includes a 38% wage increase and a $12,000 lump sum, and calls for a vote on Monday. The strike, which began on September 13, has halted production and prevented Boeing from producing new 737s.

Striking Boeing workers have rejected a new offer from the plane-making giant, which included a 35% pay rise over four years.

The International Association of Machinists and Aerospace Workers (IAM) union said 64% of its members voted against the proposed deal.

More than 30,000 of Boeing's employees have joined the walkout, which started on 13 September, after an initial offer was rejected.

• McDonald’s shares fell in extended trading after the CDC said an E. coli outbreak was linked to the chain’s Quarter Pounder burgers.
• The outbreak has led to 10 hospitalizations and one death, the CDC said.
• The agency said 49 cases have been reported so far in 10 states, with most of the illnesses in Colorado and Nebraska.

• Boeing and its machinists' union have reached a new contract proposal.
• The deal could end a more than month-long strike that has hobbled the manufacturers' production.
• The new proposal includes 35% wage increases over four years, a higher signing bonus of $7,000, guaranteed minimum payouts in an annual bonus program and higher 401(k) contributions.

It's a trend that has surprised many: Why, despite being squeezed by high prices, have Americans kept spending at retail stores and restaurants at a robust pace?

One key reason is a relatively simple one: Wealthier consumers, boosted by strong gains in income, home equity and stock market wealth, have increasingly driven the spending.

That trend, documented by Federal Reserve research, represents something of a shift from the pre-pandemic period. And it suggests that consumer spending, the primary driver of the U.S. economy, could help sustain healthy growth this year and next.

Lower-income consumers, by contrast, have been disproportionately squeezed by higher-priced rent, groceries and other necessities, leaving them less able to spend on discretionary items, like electronics, entertainment and restaurant meals, than they were before the pandemic. Though their spending is starting to rebound as inflation-adjusted incomes rise, it could be years before their finances fully recover.

The slowdown in consumer price increases comes as the European Central Bank is expected to cut interest rates.

Year-on-year inflation in the eurozone slowed to 1.7% last month, slightly lower than previously estimated, according to official data published Thursday.

It is the first time in more than three years that the inflation rate in the single currency area has fallen below the European Central Bank's (ECB)target of 2%.

Cash-starved Boeing, contending with massive financial losses from a crippling strike and years of operational and safety problems, is turning to major banks and Wall Street to raise tens of billions of dollars in cash.

In a regulatory filing early Tuesday, the company announced plans to borrow $10 billion from a consortium of banks. It also separately announced plans to raise $25 billion by selling stock and debt.

The company’s debt surged in the last six years as Boeing reported core operating losses of more than $33 billion. Its commercial airplane production has ground to a near halt by a month-long strike by 33,000 members of the International Association of Machinists.

In third week of standoff, planemaker has no plans for further talks with union, which is seeking 40% increase

Boeing has withdrawn a 30% pay offer for striking workers as talks between the company and unions reached a stalemate in the third week of a standoff over pay.

The US planemaker said it had removed its offer that would result in a pay increase by almost a third over three years for 33,000 US staff, with no further negotiations with the International Association of Machinists and Aerospace Workers (IAM) planned.

Boeing and the union held their latest round of negotiations with federal mediators on Monday and Tuesday, but talks collapsed with both parties locked in an acrimonious stalemate showing no signs of being resolved soon, Reuters reported.

KEY POINTS

• Hurricane Milton’s once-in-a-century potential could cause damage of more than $50 billion, with the potential to leave behind devastation approaching $175 billion or more in a worst-case scenario.
• “A 1-in-100 year event is estimated by some to result in $175 \[billion] in losses for landfall in the Tampa region, and $70 \[billion] in losses in the \[Fort] Myers region,” Jefferies analysts said.

Hyundai has begun producing electric SUVs in Georgia less than two years after breaking ground on its sprawling, $7.6 billion manufacturing plant west of Savannah.

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The South Korean automaker and battery partner LG Energy Solution plan to employ 8,500 total workers at the Bryan County site, about 50 miles (80 kilometers) west of Savannah, once the plant is fully operational. Hyundai has said it will produce up to 300,000 EVs per year in Georgia, as well as the batteries that power them.

The plant’s vehicle production areas have been completed and are being staffed by more than 1,000 workers, Johnson said. Its battery-making facilities remain under construction.

Employers added 254,000 jobs in September, blowing away forecasts and reversing a slowdown in hiring that had prompted the Federal Reserve to make a jumbo rate cut at its meeting last month.

Economists had forecast 140,000 new jobs, according to financial data provider FactSet.

The unemployment rate inched down to 4.1%, versus 4.2% in the prior month.

Big taxes will be imposed on imports of electric vehicles from China to the EU after the majority of member states backed the plans.

The move to introduce tariffs aims to protect the European car industry from being undermined by what EU politicians believe are unfair Chinese-state subsidies on its own cars.

Charges of up to 45% are to be enforced on electric cars made in China for the next five years, but there have been concerns such a move could raise electric vehicle (EV) prices for buyers.

The flare-up of inflation that followed the pandemic, combined with flush consumers ready to spend, ushered in an new era of profitability even more massive than previously estimated.

Longshoremen’s union says wage demands must be met or members will strike on Tuesday for first time since 1977

Ten of the busiest ports in North America are at risk of shutdown next week, as a leading union warns that 45,000 workers stand ready to walk off the job if industry operators fail to make key concessions.

The International Longshoremen’s Association (ILA) has accused the United States Maritime Alliance (USMX), which represents 40 ocean carrier and terminal operators, of making “insulting offers” to staff demanding higher pay and commitments on automation.

Workers are slated to strike on Tuesday if a new agreement is not reached, hitting 36 ports along the east and Gulf coasts of the US in what would be the first work stoppage since 1977.

JP Morgan analysts have estimated a strike could cost the US economy $5bn per day. A one-day strike backlog could take an estimated four to six days to clear, according to analysts at Sea-Intelligence, a shipping advisory firm.