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  • White-collar workers are feeling the brunt of the Fed’s rate hikes. Here’s why | CNN Business

    White-collar workers are feeling the brunt of the Fed’s rate hikes. Here’s why | CNN Business

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    A version of this story first appeared in CNN Business’ Before the Bell newsletter. Not a subscriber? You can sign up right here. You can listen to an audio version of the newsletter by clicking the same link.


    New York
    CNN Business
     — 

    September’s hotly anticipated jobs data ended up cooling markets on Friday. Stocks fell sharply as investors evaluated the report, which showed more jobs than expected were added to the US economy and indicated that more pain-inflicting interest rate hikes from the Federal Reserve lie ahead.

    But a breakdown of the numbers shows that the Fed’s plans to weaken the labor market to fight persistent inflation may already be working, just not for everybody.

    White-collar office workers appear to be feeling the brunt of the Fed’s actions: The financial and business sector saw a large decline in employment last month. Legal and advertising services also experienced drops. Service and construction workers, meanwhile, are still thriving.

    What’s happening: The US economy added 263,000 jobs in September, higher than analyst estimates of 250,000. The unemployment rate came in at 3.5%, down from 3.7% in August.

    Leading the gain in jobs was the leisure and hospitality industry, which added 83,000 jobs in September — and employment in food services and drinking places made up 60,000 of those jobs alone. Manufacturing and construction also came in hot, adding 22,000 and 19,000 jobs, respectively.

    The largest non-governmental losses in jobs came from the financial industry, which shed 8,000 between August and September. Large banks hire in cycles, extending offers to recent graduates in the early fall months. That makes this September’s drop particularly significant.

    Business support services — such as telemarketing, accounting and administrative and clerical jobs — are also bleeding jobs. The sector lost 12,000 in September. Meanwhile, legal services lost 5,000 jobs, and advertising services also dropped 5,000 jobs.

    What it means: The Federal Reserve’s hawkish policy appears to be cooling certain parts of the economy, but not others. Finance workers are likely beginning to worry as their industry depends on stock and lending markets which have been particularly hard hit by Fed actions.

    Friday’s numbers indicate that we’re beginning to see that impact in the employment data.

    What remains to be seen is whether the Fed can cool the economy just by loosening employment in white-collar industries or if these losses will trickle down to other industries, hurting lower-income workers.

    Coming up: Earnings season begins in earnest this week with big banks like JPMorgan, Citigroup

    (C)    , Morgan Stanley

    (MS)     and BlackRock

    (BLK)     reporting. Investors will be watching closely for any guidance on hiring and layoff plans.

    Two key inflation indicators, PPI and CPI are also set to be released. Expect markets to react poorly if inflation comes in hot.

    A panel of top US economists just released its economic outlook for the next year, and it’s not great.

    The panel of 45 forecasters, led by the National Association for Business Economics (NABE), said they expected slower growth, higher inflation, higher interest rates, and weakening employment in both 2022 and 2023 than they previously expected.

    Most of the worries come down to the Federal Reserve’s interest rate policy.

    “More than three-quarters of respondents believe the odds are 50-50 or less that the economy will achieve a ‘soft landing’,” said NABE Vice President Julia Coronado. “More than half the panelists indicate that the greatest downside risk to the U.S. economic outlook is too much monetary tightness.”

    NABE panelists downgraded their median forecast for real GDP for the fourth quarter of 2022 to a 0.1% increase, compared to a 1.8% increase in the May 2022 survey. The vast majority of respondents placed more than a 25% probability of a recession occurring in 2023, with the most likely start date in the first quarter.

    The latest report comes as a growing number of economists are predicting that recession is imminent. Former US Treasury Secretary Larry Summers told CNN on Thursday that it’s “more likely than not” the US will enter a recession, calling it a consequence of the “excesses the economy has been through.”

    Friday’s jobs report showed that the share of workers telecommuting or working from home because of the pandemic ticked lower — falling to just 5.2% in September from 6.5% in August.

    Fully remote work in the United States, which many predicted would remain the norm long after the pandemic, appears to be edging away, especially as the job market loosens for white collar workers and employees have less leverage.

    Last week, a KPMG survey of US-based CEOs found that two-thirds believed in-office work would be the norm within the next three years.

    Still, it may not be enough to help an ailing commercial real estate market, where the outlook is dire. New York City office properties declined by nearly 45% in value in 2020 and are forecast to remain 39% below their pre-pandemic levels long-term as hybrid policies continue, according to a recent study from the National Bureau of Economic Research.

    Looking forward: The Bureau of Labor Statistics has noted that while hybrid work may still be popular, Covid-19 is no longer fueling work from home trends. The October report will rephrase its telework questions to remove references to the pandemic.

    Since May 2020, each jobs report has asked: “At any time in the last four weeks, did you telework or work at home for pay because of the Coronavirus pandemic?”

    In May 2020, 35.4% answered yes.

    Starting next month, the question will be revised. “At any time in the last week did you telework or work at home for pay?” it will ask, limiting the timeline and eliminating any reference to the pandemic.

    The US bond market is closed for Columbus Day/Indigenous Peoples’ Day.

    Coming later this week:

    ▸ Third quarter earnings season begins. Expect reports from big banks like JPMorgan Chase

    (JPM)    , Wells Fargo

    (WFC)    , Citigroup

    (C)    , Morgan Stanley

    (MS)    , PNC

    (PNC)     and US Bancorp

    (USB)     and consumer staples like Pepsi

    (PEP)    , Walgreen

    (WBA)    s and Domino’s

    (DMPZF)    . 

    ▸ CPI and PPI, two closely watched measures of inflation in the US are also due to be released. 

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  • Trump’s visit to small Nevada town highlights importance of rural voters to state Republicans | CNN Politics

    Trump’s visit to small Nevada town highlights importance of rural voters to state Republicans | CNN Politics

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    CNN
     — 

    When former President Donald Trump touched down in Minden, Nevada, on Saturday to campaign for a slate of Republican candidates, he landed in a town of just under 3,500 people – about 0.1% of the state’s population.

    It’s a tiny stop for the former President, who rode stronger-than-expected turnout in rural stretches of the country like Minden to the White House in 2016. But it highlights just how important rural counties are to Nevada Republicans such as Senate nominee Adam Laxalt and gubernatorial hopeful Joe Lombardo in the critical midterm elections.

    “We believe that rural Nevada is the key to turning our state back,” Laxalt said during a stop late last year in Winnemucca, a mining town of under 8,000 people in northern Humboldt County.

    Nevada, which Trump lost twice, represents one of the biggest tests for Democratic power in the 2022 midterms. The party holds all but one statewide office in Nevada, and Democratic presidential nominees have carried the state in every election since 2008, buoyed by the strength of the late Democratic Senate leader Harry Reid’s so-called Reid Machine. But those Democratic margins have been declining and after closures around the coronavirus pandemic dramatically affected Nevada’s tourism-centric economy, Republicans see a strong chance to make gains in the state, hanging their hopes on Lombardo’s bid to unseat Democratic Gov. Steve Sisolak and Laxalt’s challenge to Democratic Sen. Catherine Cortez Masto.

    A CNN poll released on Thursday found no clear leader in either race: Laxalt and Lombardo had the support of 48% of likely voters compared with 46% for Cortez Masto and Sisolak.

    The same poll was littered with warning signs for Democrats. Forty-four percent of registered Nevada voters said the country would be better off if Republicans are in control of Congress, compared with 35% who said it wouldn’t be. More Republican voters in Nevada said they were extremely motivated to vote – 62% versus 52% for Democrats. And 41% of voters said the economy was the most important issue in the midterms, something Republicans have used to hammer Democrats.

    Nevada has been home to one of the most dramatic and politically important urban-rural divides in recent years. And that split could prove even more pivotal in November, given the tightness of the Senate and gubernatorial contests.

    Rural voters make up a tiny fraction of Nevada’s electorate, with the state’s major urban centers – Clark County, home to Las Vegas, and Washoe County, home to Reno – making up nearly 90% of Nevada’s population of some 3.1 million. According to a study by Iowa State University, Nevada’s rural population fell from nearly 20% of the state in 1970 to less than 6% in 2010.

    The urbanization of Nevada has long allowed Democratic candidates in the state to run on one strategy: Run up the vote total around Las Vegas, win narrowly or at least stay competitive in the Reno area and lose big in rural Nevada. Cortez Masto, the first Latina elected to the Senate, followed this strategy in 2016 when she lost every Nevada county, except Clark, but still won a first term by over 2 points.

    In recent years, that strategy paid even greater dividends as Washoe County, the second largest in the state, has tilted toward Democrats. Democratic presidential candidates have carried Washoe County in the last four presidential elections, while Sisolak and the state’s junior senator, Jacky Rosen, both won the county in 2018.

    That has put more pressure on Nevada Republicans to not only close the gap in Clark and Washoe counties but to also boost as much turnout as possible in rural areas.

    Whether that “rural first” strategy can even lead to wins any more is an open question, according to David Damore, a political science professor at University of Nevada, Las Vegas.

    “It’s a huge part of the Republican playbook, but every year it is smaller and smaller,” he said of GOP attempts to turn out rural voters. “It’s all about cutting the margin in Clark. What has happened is, even though Trump did that last time, Washoe is becoming more liberal. … It is a little bit of a whack-a-mole game for Republicans.”

    Laxalt knows the pressure he faces firsthand. When he successfully ran for state attorney general in 2014, he became the only statewide candidate in recent decades to lose both Clark and Washoe counties but win the election when he narrowly defeated Democrat Ross Miller.

    Laxalt did what a statewide Republican candidate needed do in Nevada in that race: He kept the margins down in Clark and Washoe – losing the former by less than 6 points and the latter by 1 point – and posted strong margins across the rest of the state.

    Laxalt also knows it’s not a perfect strategy. Nevada’s increased urbanization has put a strain on that rural-focused strategy as evidenced by Laxalt’s 4-point loss to Sisolak in 2018. In that race, Laxalt once again lost both Clark and Washoe, but this time by wider margins, including losing the Las Vegas area by nearly 14 points.

    Laxalt, on multiple tours through rural Nevada during his Senate campaign, has stressed the area’s importance to his success. At the same time, he’s had to walk a fine line between raising false claims about the validity of the 2020 election, including Republican concerns about vote-counting in Clark County, and the need to boost rural turnout. Laxalt has done so by raising baseless questions about Clark County elections while stressing to rural voters that their votes matter.

    “In the end of the day, rural Nevada can provide 75,000-vote cushions, so rural Nevada still matters,” he told an audience in Fallon in late 2021. “Rural Nevada is discouraged. They think Vegas is all that matters. Not true. The vote block out of rural Nevada still makes a huge difference.”

    Brian Freimuth, a spokesman for Laxalt, said in a statement that the Republican’s effort “is the most well-traveled campaign in the state” and has “hosted events in every rural county, dozens of rural meet & greets, a cattle drive, and events with ranchers and farmers.”

    “Rural Nevadans know that Adam’s record on water rights, the second amendment, sage grouse, and fighting federal overreach make him the best candidate in this race,” said Freimuth.

    Cortez Masto, arguably the most vulnerable Democratic Senate incumbent in the country, has focused much of her campaign on tying Laxalt to Trump. Laxalt, who was a co-chair of Trump’s 2020 campaign in Nevada, was central to filing election lawsuits seeking to overturn the presidential result in the state, which Biden won by 2 points. Those lawsuits did not change the election result.

    Cortez Masto has also looked to cut into Laxalt’s advantage in rural areas.

    A former state attorney general herself, she embarked on a rural tour of Nevada in August, campaigning in communities such as Ely, Elko, Winnemucca and Fallon – all with populations of less than 20,000 people.

    “When I became your US senator, it was just as important to me to get out and talk to Nevadans, because here’s the deal: To me, it is about all of us succeeding and that rising tide lifting all of us,” she said in Ely. “At the end of the day, your party affiliation, your background is about making sure your families are successful, your businesses are successful, we’re all in this together.”

    Cortez Masto has been endorsed by several rural Republican leaders, such as former Winnemucca Mayor Di An Putnam and Ely Mayor Nathan Robertson, who said in a statement that the incumbent will “continue working hard in the Senate to champion issues important to all rural Nevadans.”

    In response to a question from CNN about Trump rallying with Laxalt in rural Nevada, Cortez Masto spokesman Josh Marcus-Blank said, “No one did more to overturn the 2020 election for Donald Trump than Adam Laxalt, and he is once again being rewarded.”

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  • Shooting outside Rep. Zeldin’s home in NY; family unhurt | CNN Politics

    Shooting outside Rep. Zeldin’s home in NY; family unhurt | CNN Politics

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    CNN
     — 

    A shooting on the Shirley, New York, property of Rep. Lee Zeldin on Sunday left two injured, the congressman and Republican gubernatorial candidate said in a statement. Zeldin’s family was unhurt.

    “My 16 year old daughters, Mikayla and Arianna, were at our house doing homework, while my wife, Diana, and I were in the car, having just departed the Bronx Columbus Day Parade in Morris Park,” Zeldin said.

    The two individuals who were shot had been laying down under the family’s front porch and in the bushes in front of the porch, Zeldin said.

    “After my daughters heard the gunshots and the screaming, they ran upstairs, locked themselves in the bathroom and immediately called 911. They acted very swiftly and smartly every step of the way and Diana and I are extremely proud of them.”

    The circumstances of the shooting were unclear. But Suffolk County Police said the shooting has no connection to the Zeldin family. A police spokesperson said the two people injured in the incident have been transported to area hospitals for treatment.

    Zeldin said police investigators came to his home, and security footage was provided from the family’s home cameras. He said he did not know the identities of the two people.

    “My daughters are shaken, but ok,” he said. “Like so many New Yorkers, crime has literally made its way to our front door. My family is grateful to all who have reached out and we will provide another update when we can.”

    Zeldin has made criticism of rising crime a central theme in his gubernatorial campaign against incumbent Democratic Gov. Kathy Hochul. He was attacked by a man holding a sharp object on the campaign trail in July.

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  • Republican Sen. Rick Scott to campaign for Herschel Walker in Georgia this week | CNN Politics

    Republican Sen. Rick Scott to campaign for Herschel Walker in Georgia this week | CNN Politics

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    CNN
     — 

    Sen. Rick Scott of Florida will travel to Georgia on Tuesday to support GOP Senate nominee Herschel Walker, whose campaign has been reeling following reports Walker asked a woman to terminate two pregnancies.

    The move by Scott highlights how critical the race in Georgia is with a 50-50 split in the US Senate. Scott is chairman of the National Republican Senatorial Committee, the Senate Republican campaign arm.

    “The Democrats want to destroy this country, and they will try to destroy anyone who gets in their way. Today it’s Herschel Walker, but tomorrow it’s the American people,” Scott said in a statement sent to CNN on Saturday. “I’m proud to stand with Herschel Walker and make sure Georgians know that he will always fight to protect them from the forces trying to destroy Georgia values and Georgia’s economy, led by Raphael Warnock.”

    Warnock, a Democratic senator from Georgia, is Walker’s opponent.

    The Daily Beast reported on Friday that Walker paid for a woman’s abortion in 2009. The woman told The New York Times that Walker asked her to terminate a second pregnancy two years later, but she refused the request and their relationship ended.

    Walker, who said in May he supports a full ban on abortions, with no exceptions, has denied the earlier report from The Daily Beast, calling the allegation a “flat-out lie.”

    CNN has not independently confirmed the woman’s allegation about the abortion or that Walker urged her to terminate a second pregnancy. CNN has reached out to the Walker campaign for comment.

    Earlier Saturday, Warnock, said Walker “has trouble with the truth.”

    “It’s up to Georgia voters. It’s not up to him, it’s not up to me,” Warnock said. “We do know that my opponent has trouble with the truth. And we’ll see how all this plays out, but I am focused squarely on the health care needs of my constituents, including reproductive health care.”

    NRSC spokesperson Chris Hartline said on Saturday that the organization will “have a big presence in Georgia in the final stretch.”

    Republican Sen. Tom Cotton of Arkansas will also be in Georgia to campaign for Walker on Tuesday.

    “Senator Cotton is headed to Georgia on Tuesday to campaign for Herschel Walker and help Republicans take back the Senate next month,” Cotton’s communications director, Caroline Tabler, told CNN. “He believes Herschel will be a champion for Georgia who will vote to keep violent criminals in jail, for lower gas prices, and to stop Joe Biden’s inflationary policies.”

    The Washington Post first reported on Scott and Cotton’s trip to Georgia.

    On Sunday, GOP Rep. Don Bacon, who is facing a competitive reelection in a swing district in Nebraska, told NBC he still backs Walker.

    “I sure do,” Bacon told Kristen Welker on “Meet the Press.”

    “Hershel needs to come clean and be honest,” he added. “We also know that we all make mistakes. It’s better – if this actually did happen – it’s better to say ‘I’m sorry’ and ask for forgiveness.”

    This headline and story have been updated.

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  • Elon Musk’s bumpy road to possibly owning Twitter: A timeline | CNN Business

    Elon Musk’s bumpy road to possibly owning Twitter: A timeline | CNN Business

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    CNN Business
     — 

    A board seat accepted and then rejected. A stunning $44 billion takeover offer with uncertain financing. And a surprise early morning tweet putting the deal on hold, temporarily.

    Even by the standards of Twitter, a company that has known plenty of chaos and dysfunction in its history, the weeks-long effort by billionaire Elon Musk to buy the company has proven to be uniquely tumultuous – and there’s no clear end in sight.

    Should the deal go through, it would place the world’s richest man in charge of one of the world’s most influential social media platforms. The acquisition has the potential to upend not just Twitter itself but politics, media and the tech industry. The Tesla and SpaceX CEO has repeatedly stressed that his goal is to bolster what he calls “free speech” on the platform, by which he means all legal speech that complies with local laws in the markets where Twitter operates. He has also said he would reverse Twitter’s ban of former President Donald Trump.

    But the attempt by Musk, a wildly successful entrepreneur with a history of erratic behavior, to buy Twitter has been viewed with some skepticism from the start. On the day he made his offer, Musk said: “I’m not sure I’ll actually be able to acquire it.” Some have questioned how he would finance the deal, especially as shares of Tesla

    (TSLA)    , which he’s partially using to back his financing of the Twitter deal, and the broader tech sector have declined in the weeks since.

    After Musk recently said he was temporarily pausing the deal so he could assess the amount of spam and fake accounts, it prompted speculation that the billionaire might be looking to renegotiate the deal – or back out of it entirely. His actions in the days that followed only reinforced that thinking.

    Here is a look back at the many twists and turns in one of the most high-profile tech deals in recent memory.

    Musk starts quietly buying up Twitter shares, building his stake in the company. But it would be months before he disclosed this fact to the public.

    Musk’s stake in Twitter tops 5%, but that fact is not disclosed until the following month. Musk was obligated to disclose his stake within 10 days of crossing the 5% threshold, but waited 21 days to do so. During that time, he continued building up his stake.

    The billionaire begins to make pointed statements about the platform from his account. “Twitter algorithm should be open source,” he wrote, with a poll for users to vote “yes” or “no.”

    The following day, Musk tweets out another poll to his followers: “Free speech is essential to a functioning democracy. Do you believe Twitter rigorously adheres to this principle?”

    Musk reaches out to Twitter cofounder and former CEO Jack Dorsey to “discuss the future direction of social media,” according to a company filing later put out by the company. The two tech founders are known to have a bit of a billionaire bromance on and off Twitter.

    Twitter’s board and some of its leadership team meet with representatives from Wilson Sonsini, a law firm, and J.P. Morgan to discuss the possibility of Musk joining the company’s board, according a later securities filing. Dorsey is said to have told the board that “he and Mr. Musk were friends,” according to the filing.

    In the meeting, the Twitter board discussed wanting Musk to agree to “‘standstill’ provisions”,” according to the filing. This would effectively “limit his public statements regarding Twitter, including the making of unsolicited public proposals to acquire Twitter (but not private proposals) without the prior consent of the Twitter Board.”

    Musk is revealed to be Twitter’s largest individual shareholder, with a more than 9% stake in the company.

    News of the purchase sends shares of the social media company soaring more than 20% in early trading and kicks off a wave of speculation about how Musk might push for changes on the platform.

    Twitter CEO Parag Agrawal announces Musk will join Twitter’s board of directors. “Through conversations with Elon in recent weeks, it became clear to us that he would bring great value to our Board,” Agrawal says in a post on Twitter.

    As part of the appointment, Musk agrees not to acquire more than 14.9% of the company’s shares while he remains on the board. His term on the board is set to go through 2024, according to a regulatory filing.

    Twitter CEO Parag Agrawal (left) and former CEO Jack Dorsey in an undated photo.

    Agrawal announces that Musk has decided not to join the board after all. “I believe this is for the best,” Agrawal writes in a letter to the Twitter team.

    The reversal opens the door for Musk to pursue a greater stake in the company – and frees him to tweet his many thoughts about the company.

    Musk stuns the industry by making an offer to acquire all the shares in Twitter he does not own at a valuation of $41.4 billion. The cash offer represents a 38% premium over the company’s closing price on April 1, the last trading day before Musk disclosed that he had become the company’s biggest shareholder.

    “I invested in Twitter as I believe in its potential to be the platform for free speech around the globe, and I believe free speech is a societal imperative for a functioning democracy. However, since making my investment I now realize the company will neither thrive nor serve this societal imperative in its current form. Twitter needs to be transformed as a private company,” Musk writes in his offer letter. “Twitter has extraordinary potential. I will unlock it.”

    Twitter’s board of directors adopts a “poison pill” provision, a limited-term shareholder rights plan that potentially makes it harder for Musk to acquire the company.

    Tesla CEO Elon Musk speaks during the official opening of the new Tesla electric car manufacturing plant on March 22, 2022 near Gruenheide, Germany.

    Musk lines up $46.5 billion in financing for the deal, including two debt commitment letters from Morgan Stanley and other unnamed financial institutions and one equity commitment letter from himself, according to a regulatory filing.

    The billionaire also reveals that he has not received a formal response from Twitter a week after his acquisition offer. He said he is “seeking to negotiate” a definite acquisition agreement and “is prepared to begin such negotiations immediately” — an apparent reversal from his statement in his acquisition offer letter that it would be his “best and final” offer.

    Although he is the richest person in the world, much of Musk’s wealth is tied up in Tesla stock, and some followers of the company speculate that it could be challenging for Musk to raise debt against the historically volatile stock.

    Twitter announces that it has agreed to sell itself to Musk in a deal valued at around $44 billion. At a conference later in the day, Musk describes his offer to buy Twitter in characteristically sweeping terms as being about “the future of civilization,” not just making money.

    At an all-hands meeting that afternoon, Twitter employees raise questions about everything from what the deal would mean for their compensation to whether former US President Donald Trump would be let back on the platform.

    Filings reveal Musk sold $8.5 billion of his Tesla stock in the three days after Twitter board agreed to the sale for an average of $883.09 per share. The filings did not disclose the reason for the sale, but Musk appeared to be raising funds to buy Twitter.

    Tesla cars sit in a dealership lot on March 28, 2022 in Chicago, Illinois.

    Musk raises another $7 billion in financing for the deal. The new investors include Oracle founder Larry Ellison, cryptocurrency platform Binance and venture capital firm Sequoia Capital, according to a filing.

    Musk aims to increase Twitter’s annual revenue to $26.4 billion by 2028, up from $5 billion last year, according to a New York Times report, citing Musk’s pitch deck presented to investors. To achieve that lofty goal, Musk intends to bolster Twitter’s subscription revenue and build up a payments business while decreasing the company’s reliance on advertising sales, according to the report.

    Musk confirms what many have assumed for weeks: he would reverse Twitter’s Trump ban if his deal to buy the company is completed.

    “I do think it was not correct to ban Donald Trump, I think that was a mistake,” Musk said. “I would reverse the perma-ban. … Banning Trump from Twitter didn’t end Trump’s voice, it will amplify it among the right and this is why it’s morally wrong and flat out stupid.”

    Former President Donald Trump looks at his phone during a roundtable with governors on the reopening of America's small businesses, in the State Dining Room of the White House in Washington, June 18, 2020.

    Twitter confirms to CNN Business that the platform is pausing most hiring and backfills, except for “business critical” roles, and pulling back on other non-labor costs ahead of the acquisition. In addition, Twitter says general manager of consumer, Kayvon Beykpour, and revenue product lead, Bruce Falck, are leaving the company.

    Musk tweets that the deal is on hold, linking to a Reuters report from nearly two weeks earlier, about Twitter’s most recent disclosure about its amount of spam and fake accounts. The figure cited in the report, however, is in line with prior quarterly disclosures.

    “Twitter deal temporarily on hold pending details supporting calculation that spam/fake accounts do indeed represent less than 5% of users,” Musk tweeted.

    Shares of the social media site plummet after Musk’s announcement, dropping more than 10% at market open. Two hours after announcing the hold, Musk says he remains set on purchasing Twitter. “Still committed to acquisition,” he wrote.

    Later in the day, Musk says his team is testing Twitter’s numbers and “picked 100 as the sample size number, because that is what Twitter uses to calculate

    Musk tweets out that Twitter’s legal team accused him of breaking a nondisclosure agreement when the billionaire revealed the platform’s sample size for automated user checks is allegedly just 100 users.

    “Twitter legal just called to complain that I violated their NDA by revealing the bot check sample size is 100! This actually happened,” wrote Musk.

    The standoff over bot accounts continues as Musk exchanges a series of tweets with Agrawal over the issue. After Agrawal carefully explains how Twitter attempts to combat and measure spam accounts, Musk responds with a poop emoji.

    Musk follows up with a somewhat more thoughtful question. “So how do advertisers know what they’re getting for their money?” Musk asked. “This is fundamental to the financial health of Twitter,” he added.

    Musk announces that his acquisition of Twitter “cannot move forward” until he sees more information about the prevalence of spam accounts, claiming that the social media platform falsified numbers in filings. Without citing a source, he claims in a tweet that Twitter is “20% fake/spam accounts” and suggests Twitter’s previous filings with the SEC were misleading.

    Later in the day, Musk posts a poll to his Twitter followers: “Twitter claims that >95% of daily active users are real, unique humans. Does anyone have that experience?” before calling on the SEC to evaluate the platform’s numbers. “Hello @SECGov, anyone home?” Musk tweets, in an apparent attempt to get the regulator to look into the matter.

    In a statement, Twitter says it remains “committed to completing the transaction on the agreed price and terms as promptly as practicable.” Later, the company says it intends to “enforce the merger agreement.”

    In a letter to Twitter’s head of legal, Musk threatens to walk away from his purchase of the platform, alleging that Twitter is “actively resisting and thwarting his information rights” as outlined by the deal.

    In the letter, an attorney for Musk accuses the social media company of breaching the merger agreement by not providing the data he has requested on Twitter spam bots, stating that the lack of information gives him a right “not to consummate the transaction” and “to terminate the merger agreement.”

    Musk moved to terminate the acquisition agreement. A lawyer representing him claimed in a letter to Twitter’s top lawyer that the company is “in material breach of multiple provisions” of the deal over its alleged failure to provide all the data Musk says he needs to evaluate the number of spam and fake accounts on the platform.

    “For nearly two months, Mr. Musk has sought the data and information necessary to ‘make an independent assessment of the prevalence of fake or spam accounts on Twitter’s platform,’” the letter reads. “This information is fundamental to Twitter’s business and financial performance and is necessary to consummate the transactions contemplated by the Merger Agreement. … Twitter has failed or refused to provide this information.”

    Twitter was not having it.

    “The Twitter Board is committed to closing the transaction on the price and terms agreed upon with Mr. Musk and plans to pursue legal action to enforce the merger agreement,” Twitter board chair Bret Taylor said in a tweet Friday, echoing earlier statements by the company that it planned to follow through with the deal. “We are confident we will prevail in the Delaware Court of Chancery.”

    Twitter sued the Tesla billionaire in Delaware court in an attempt to force him to complete the deal.

    The 62-page lawsuit, sprinkled with memes, tweets and a poop emoji, effectively highlighted the bizarre spectacle of the deal from the start. The company paints Musk as a non-serious potential owner — alleging at one point that he has “disdain” for the company, and at another saying, “Musk’s strategy is … a model of bad faith” — while seeking to compel him to become its owner. (Twitter’s board has an obligation to its shareholders to try to see the deal through if they believe it is in their best interest. The dispute could also end in a settlement.)

    Twitter’s lawsuit against Musk over his move to terminate their $44 billion acquisition agreement will go to trial on Oct. 17 and run for five days, a Delaware judge ruled.

    The decision came after Judge Kathaleen St. Jude McCormick, who is overseeing the case, previously ruled in Twitter’s favor that the proceedings could be expedited and take place in October. Twitter initially pushed for an October 10th start.

    Musk’s legal team had asked for the trial to take place in 2023. Twitter’s legal team argued it was necessary to expedite the case in order to limit the “harm” to its business and to ensure the deal can be completed before Oct. 24, the “drop dead” date by which the two sides had previously agreed to close the deal.

    Peiter

    Twitter whistleblower Peiter “Mudge” Zatko testifies before Congress in his first public appearance after his bombshell allegations against the social media company were reported in August by CNN and The Washington Post.

    In a whistleblower disclosure sent to multiple lawmakers and government agencies in July, Zatko accused Twitter of failing to safeguard users’ personal information and of exposing the most sensitive parts of its operation to too many people, including potentially to foreign spies. Zatko — who was Twitter’s head of security from November 2020 until he was fired in January — also alleged company executives, including CEO Parag Agrawal, have deliberately misled regulators and the company’s own board about its shortcomings.

    Zatko claimed in his testimony that Twitter is extremely vulnerable to being penetrated and exploited by agents of foreign governments, as well as detailed some of the personal information Twitter collects on users and alleged that the company does not know where the majority of its collected data goes.

    Days earlier, a judge allowed Musk’s legal team to add arguments based on the whistleblower disclosure to its case.

    Musk sends a letter to Twitter proposing to complete the deal as originally signed for $54.20 per share, citing people familiar with the negotiations. News of the letter, revealed in a security filing the next day, sends Twitter stock surging more than 20%, approaching the deal price for the first time in months.

    Such an agreement could bring to an end a contentious, months-long back and forth between Musk and Twitter that has caused massive uncertainty for employees, investors and users of one of the world’s most influential social media platforms.

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  • Mandela Barnes has signaled support for removing police funding and abolishing ICE — despite ad claiming otherwise | CNN Politics

    Mandela Barnes has signaled support for removing police funding and abolishing ICE — despite ad claiming otherwise | CNN Politics

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    CNN
     — 

    Wisconsin Democratic Senate nominee Mandela Barnes has previously signaled his support for removing police funding and abolishing ICE, according to a review by CNN’s KFile, despite claiming otherwise in a recent ad in which he speaks directly to the camera to defend his record on those issues.

    “Look, we knew the other side would make up lies about me to scare you. Now they’re claiming I want to defund the police and abolish ICE. That’s a lie,” says Barnes to the camera in a recent 30-second television ad called “Truth.”

    But a CNN KFile review of Barnes’ social media activity and public comments he made in interview appearances reveal a different and more nuanced picture in which Barnes often signaled his support for such positions.

    In multiple posts from 2018 uncovered by CNN, Barnes liked tweets that criticized the immigration agency and called to abolish them. He told a group that supported abolishing the institution in 2019 that the “wrong ICE” was melting and attended one of their “Abolish ICE” local rallies.

    This week, Barnes pushed back on attacks on his record on criminal justice and crime, saying he wouldn’t be “lectured on crime” by Republicans, citing the January 6, 2021, riot at the US Capitol in which more than 100 police officers reported injuries.

    Barnes, the lieutenant governor of Wisconsin, fielded another attack Friday night from incumbent Republican Sen. Ron Johnson, with whom he is locked in a tight race. The outcome could determine control of the US Senate next year.

    “He has a record of wanting to defund the police,” Johnson said of Barnes during a debate. “And I know he doesn’t necessarily say that word, but he has a long history of being supported by people that are leading the effort to defund, who uses code words like (Missouri Democratic Rep.) Cori Bush said, talking about reallocate over bloated police budgets.”

    Barnes shot back that Johnson didn’t have any concern for the “140 officers that were injured in the January 6 insurrection.” Johnson in turn said that he “immediately and forcefully and have repeatedly condemned (the Capitol riot) and condemned it strongly.”

    Though Barnes has never outright embraced the “defund the police” slogan, he has on numerous occasions said he supports redirecting or decreasing police funding – even before the slogan gained popularity in 2020 following the murder of George Floyd by police.

    In one 2020 interview reviewed by CNN, Barnes told a local Wisconsin public radio show that funding should go to social workers and a “crisis intervener or a violence interrupter,” instead of police.

    Maddy McDaniel, spokesperson for the Barnes campaign, said he does not support defunding the police or abolishing ICE.

    “As independent fact-checkers have verified, Lt. Governor Mandela Barnes does not support abolishing ICE or defunding the police.”

    In previously unreported activity on social media reviewed by CNN’s KFile, Barnes repeatedly liked tweets about abolishing ICE.

    He liked one September 2018 tweet that used the “#AbolishICE” hashtag and compared the agency to “modern day slave catchers.” His Twitter account also liked other tweets calling for abolishing ICE twice in July 2018 and twice in June.

    “Imagine a world without ICE,” read one of the tweets liked by Barnes.

    Barnes also once solicited an “Abolish ICE” T-shirt on Twitter in 2018 writing, “I need that,” when offered the Democratic Socialists of America-branded shirt. A photo of Barnes holding a similar shirt later circulated on social media. Barnes told the Milwaukee Journal-Sentinel, which first reported on the shirt, he was not part of the abolish ICE movement saying “no one slogan can capture all the work we have to do.”

    While speaking to the Wisconsin-based immigration group Voces de la Frontera Action in 2019, Barnes alluded to calls to get rid of the immigration enforcement agency.

    “We’re bringing science back. We’re bringing science back for the next generation. We’re bringing science back because the wrong ICE is melting,” Barnes said.

    In June of 2018 at a different event from the group, Barnes attended what was labeled a protest to “top the Indefinite Imprisonment of Families & Abolish ICE,” according to photos on his Facebook page.

    “Great turnout at Voces de la Frontera’s event to #protest President Trump’s #immigration policies at the Milwaukee Immigration and Customs Enforcement (ICE) office! However, there is more to do to ensure that immigrants’ rights – human rights – are protected. Let your voices be heard!” Barnes wrote on Facebook about the event, which featured the executive director of the organization calling for the abolishment of the agency.

    While he has never outright embraced the “defund the police” slogan, Barnes has long called for reforming or changing policing, especially in communities of color and reducing their budgets.

    Speaking in 2015 on a panel entitled “Civil Rights in the Age of Extremism,” Barnes called police officers who don’t live in communities in which they police an “occupying force.” He also advocated reducing police budgets even before the “defund the police” slogan became popular on the far-left in the summer of 2020.

    Which policies the “defund the police” slogan stands for are actively debated, with some arguing it means abolishing police departments all together, while others have embraced shifting police funding to other social services in the community. Barnes reiterated support for the latter in a 2012 survey for the organization Vote Smart where he indicated he supported slightly decreasing budgets for law enforcement and corrections.

    In early June 2020, Barnes said “defunding” police wasn’t as “aggressive” as it was portrayed, citing budget cuts to other social services.

    “Defunding isn’t necessarily as aggressive as a lot of folks paint it,” Barnes said. “You know, school budgets get cut almost every year.”

    When asked directly if he supported defunding the police, Barnes told Wisconsin public radio in late June 2020 that he thought funding for police was a “mismatch” compared to other services in the city.

    “You can look at the City of Milwaukee, for example, where 45% of the departmental allocations that goes to police while libraries are like two or three percent, neighborhood services, two or three percent,” Barnes said. “I think that you can look at that a, a priorities mismatch.”

    Barnes, comparing police budgets to money spent on prisons and the military, said the money could be better spent on social workers or violence interrupters.

    “We’re working to reduce our prison population, we’re very intentional about making that happen and it takes that intentionality,” he said. “It’s easy to look at the police department and say, ‘Well, yeah, we are spending a lot of money. How do we get smarter about this?’”

    “It becomes the conversation about needs,” he continued. “This isn’t about attacking the police. If anything, it’s about making their jobs easier by implementing programs … where we have services where they wouldn’t have to respond to things that aren’t crime, where they don’t have to respond to, you know, instances that would be better suited for a social worker or some sort of crisis intervener or a violence interrupter that would help, you know, uh, promote peace and communities in the first place.”

    “I think that’s where our funding should go,” Barnes reiterated. “What’s going on right now isn’t necessarily working, you know, police brutality is one thing – but in general, uh, the idea of promoting safer communities, I don’t, I don’t think that we’re doing a good job at that.”

    This story has been updated with additional developments Friday.

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  • Prosecutors argue Graham should have to testify before grand jury in Georgia 2020 investigation | CNN Politics

    Prosecutors argue Graham should have to testify before grand jury in Georgia 2020 investigation | CNN Politics

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    CNN
     — 

    The Fulton County district attorney’s office is pushing back on Sen. Lindsey Graham’s ongoing efforts to quash a grand jury subpoena, saying his testimony is “essential” and could reveal more information about efforts by former President Donald Trump and his allies to overturn the 2020 election in Georgia.

    Graham, a South Carolina Republican, is asking the 11th Circuit US Court of Appeals to put on hold a lower federal court order that Graham must testify to the grand jury, with the questions limited in scope.

    The litigation over the subpoena has been on-going for months, with Graham initially moving to quash the motion in July. Prosecutors say that, after three failed attempts to quash his subpoena, Graham is repeating the same arguments. They are asking for the matter to be remanded back to a Fulton County Superior Court, which oversees the grand jury investigation.

    “The Senator’s position, which would allow him to dictate when and where he will be immune from questioning or liability, renders him precisely the sort of unaccountable ‘super-citizen’ which the United States Supreme Court has taken care to avoid,” the Fulton County district attorney’s office said in the court filing with the 11th Circuit on Friday.

    Graham’s attorneys argue that the lower court ruling did not offer enough protection from being questioned about his role as a US senator.

    They say that his calls to Georgia officials after the election were legislative activity directly related to his committee responsibilities as the then-chairman of the Senate Judiciary Committee, and that his actions should be protected by the US Constitution’s Speech or Debate Clause.

    Atlanta-based federal Judge Leigh Martin May, who denied Graham’s motion to quash his subpoena this summer, wrote in her decision that there were “considerable areas of inquiry” that were not legislative in nature that he should have to testify about.

    Fulton County District Attorney Fani Willis, who is leading the investigation into 2020 election interference, wrote in previous court filings that she wants to question the senator about his phone calls to election officials.

    Willis is particularly interested in a call Graham made to Georgia Secretary of State Brad Raffensperger when – according to Raffensperger – Graham hinted that Raffensperger should discard some Georgia ballots during the state’s audit.

    Fulton County prosecutors on Friday said Graham’s claim that the call was intended to inform his vote on certifying the 2020 election amounts to “litigation-prompted hindsight” and “a product of lawyering, not legislating.”

    Graham has repeatedly denied accusations of applying any pressure to Georgia officials. Even if he were to lose this appeal, he signaled he would take the case to the Supreme Court.

    “I’ll go as far as I need to take it,” Graham told CNN last month. “I’m committed to standing up for the institution as I see it.”

    The 11th Circuit will rule on Graham’s emergency motion. The appeals court has set Tuesday as deadline for his legal team to file an opening brief on the merits of the appeal.

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  • Anna Sorokin, the real-life ‘Inventing Anna,’ is out of jail | CNN

    Anna Sorokin, the real-life ‘Inventing Anna,’ is out of jail | CNN

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    CNN
     — 

    Anna Sorokin, the fake heiress Netflix’s “Inventing Anna” is based on, was released from ICE detention on Friday.

    Juda Engelmayer, a spokesman for Sorokin, confirmed her release in an email to CNN Friday night.

    “She will remain under the supervision of ICE, but will be able to fight her deportation free from physical custody,” said John Sandweg, a former acting director of Immigration and Customs Enforcement who’s on Sorokin’s legal team.

    Immigration Judge Charles Conroy cleared the way for Sorokin’s release earlier this week, setting her bond at $10,000 and requiring her to follow certain conditions. Among them: staying off social media and remaining at the same residential address 24 hours a day while her case proceeds.

    The judge’s ruling also said ICE may use an ankle monitor to keep tabs on Sorokin.

    A spokesman for ICE said Sorokin was being released Friday after the judge’s ruling.

    She’d been in ICE detention for 17 months, according to her attorney – mostly at the Orange County Correctional Facility in upstate New York, about 60 miles from New York City.

    “We are grateful that the Court agreed that her continued detention is unnecessary,” Sandweg said in a statement Friday.

    Sorokin was found guilty of stealing more than $200,000 from banks and friends while scamming her way into New York society, the Manhattan District Attorney said after her 2019 conviction.

    Her case drew widespread attention after a 2018 New York magazine article.

    That article became the basis of Shonda Rhimes’ “Inventing Anna,” a dramatization that released on Netflix in February and quickly became one of the streamer’s most popular shows. Actress Julia Garner, best known for her Emmy-winning role as Ruth on “Ozark,” played Sorokin.

    The show ends with Sorokin’s conviction. But in real life, the drama has continued.

    Sorokin was released from jail in February 2021 after serving nearly four years on theft and larceny charges. But it wasn’t long before she ended up back behind bars.

    ICE took custody of Sorokin on March 25, 2021. In November, the Board of Immigration Appeals granted an emergency stay in her case, according to ICE. She’s been fighting her deportation – and also joined a group of plaintiffs suing the agency earlier this year, alleging they’d requested and been denied Covid booster shots while in custody. They dropped their lawsuit in March after receiving the shots, according to court records.

    While she’s been detained, frequent posts have been made on Sorokin’s social media accounts. Recently they’ve highlighted Sorokin’s artwork, which was featured in a New York show in May.

    Earlier this year an attorney representing Sorokin told NBC News that he feared her deportation when he couldn’t reach her, but word later emerged that she was still in ICE custody.

    Soon afterward, Sorokin spoke out from behind bars, telling the “Call Her Daddy” podcast that she never claimed to be a German heiress.

    “I was from Germany, which was true, but nobody ever asked me about my job,” Sorokin said. “Nobody asks who are your parents and how much money do they make. It’s just outrageous.”

    She told host Alex Cooper that she never “told any senseless lies.”

    But she admitted – sort of – to lying about her status and background.

    “I guess I did,” she said. “I mean, I cannot tell an exact instance, but I’m sure.”

    Sorokin also said she was surprised by the public’s fascination with her story.

    “It was just really a surprise to me that people would be, like, so interested in the way I went about the things, because it just made so much sense to me,” she said.

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  • US Postal Service proposes new prices ‘to offset’ inflation | CNN Politics

    US Postal Service proposes new prices ‘to offset’ inflation | CNN Politics

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    CNN
     — 

    The US Postal Service on Friday proposed increased prices “to offset the rise in inflation,” according to a statement from the agency.

    The price hikes, which have been approved by the Governors of the U.S. Postal Service, include a three-cent increase to purchase a stamp and a four-cent increase to mail a postcard. The changes amount to a 4.2% price increase for first class mail, according to USPS.

    The proposal must now be reviewed by the Postal Regulatory Commission.

    The announcement from the US Postal Service comes as consumers around the nation continue to grapple with rising prices for groceries, gas and other necessities. The US Postal Service has publicly struggled financially in recent years, and President Joe Biden signed a law earlier this year to overhaul the USPS’ finances and allow the agency to modernize its service.

    “As operating expenses continue to rise, these price adjustments provide the Postal Service with much needed revenue to achieve the financial stability sought by its Delivering for America 10-year plan,” US Postal Service said on Friday. “The prices of the U.S. Postal Service remain among the most affordable in the world.”

    Unlike other government agencies, the USPS generally does not receive taxpayer funding, and instead must rely on revenue from stamps and package deliveries to support itself.

    The Postal Service is also looking to increase fees for P.O. Box rentals, money orders and the cost to purchase insurance when mailing an item.

    If approved by the Postal Regulatory Commission the changes would take effect January 22, 2023, after midnight.

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  • Biden’s student loan forgiveness application is coming soon. Here’s what you need to know | CNN Politics

    Biden’s student loan forgiveness application is coming soon. Here’s what you need to know | CNN Politics

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    Washington
    CNN
     — 

    The application for President Joe Biden’s student loan forgiveness plan is expected to go live as soon as this week.

    Announced in late August, the plan will deliver federal student loan forgiveness to millions of low- and middle-income borrowers.

    Individuals who earned less than $125,000 in either 2020 or 2021 and married couples or heads of households who made less than $250,000 annually in those years will see up to $10,000 of their federal student loan debt forgiven.

    If a qualifying borrower also received a federal Pell grant while enrolled in college, the individual is eligible for up to $20,000 of debt forgiveness.

    In addition to federal Direct Loans used to pay for an undergraduate degree, federal PLUS loans borrowed by graduate students and parents may also be eligible if the borrower meets the income requirements.

    Facing mounting legal challenges to the student loan forgiveness policy, the Biden administration announced some last-minute changes to the program last week. Borrowers are still awaiting final details on the policy.

    The Department of Education regularly updates the Federal Student Aid website with information on the forgiveness program.

    Here’s what we know so far:

    The application has not been released yet but the Biden administration has said it will come out sometime in October.

    The online application will be short, according to the Department of Education. Borrowers won’t need to upload any supporting documents or use their Federal Student Aid ID to submit the application.

    “Once you submit your application, we’ll review it, determine your eligibility for debt relief and work with your loan servicer(s) to process your relief. We’ll contact you if we need any additional information from you,” the department said an email to borrowers last week.

    Borrowers will have more than a year to apply. The deadline will be December 2023.

    To be notified when the process has officially opened, sign up at the Department of Education subscription page.

    About 8 million people are expected to receive student loan forgiveness automatically because the Department of Education already knows what their income is, likely due to previously submitted financial aid forms or income-driven repayment plan applications.

    It’s unclear when exactly debts will be discharged. But due to ongoing lawsuits, the government has agreed in court to hold off canceling any federal student loan debt before October 17.

    The Biden administration scaled back eligibility for the program last week, as it faces mounting legal challenges to the policy.

    The program will now exclude borrowers whose federal student loans are guaranteed by the government but held by private lenders. The administration has said the change could affect about 700,000 people.

    The Department of Education initially said these loans, many of which were made under the former Federal Family Education Loan program and Federal Perkins Loan program, would be eligible for the one-time forgiveness action as long as the borrower consolidated his or her debt into the federal Direct Loan program.

    But the agency has reversed course after six Republican-led states sued the Biden administration, arguing that forgiving the privately held loans would financially hurt states and student loan servicers.

    Now, privately held federal student loans must have been consolidated before September 29 in order to be eligible for the debt relief.

    The White House clarified last week that borrowers will be able to opt out if they don’t want to receive the debt forgiveness.

    The Biden administration’s announcement came hours after a borrower sued, arguing that he would be forced to pay state taxes on the amount canceled – an expense he would otherwise avoid.

    There are a handful of states that may tax the debt discharged under Biden’s plan if state legislative or administrative changes are not made beforehand, according to the Tax Foundation.

    There are currently at least three significant lawsuits aiming to block the Biden administration from implementing its student loan forgiveness plan.

    Republican states are leading the charge. In addition to the lawsuit filed by six Republican-led states that say they could be hurt financially by the forgiveness plan, Arizona Attorney General Mark Brnovich also filed a lawsuit last week.

    Brnovich, a Republican, argues that the policy could reduce Arizona’s tax revenue because the state code doesn’t consider the loan forgiveness as taxable income, according to the lawsuit. The complaint also argues that the forgiveness policy will hurt the attorney general office’s ability to recruit employees. Currently its employees may be eligible for the federal Public Service Loan Forgiveness program, but some potential job candidates may not view that as a benefit if their student loan debt is already canceled, the lawsuit argues.

    A federal judge has already denied the request in the third lawsuit – from a borrower who sued arguing that they would incur a bigger state tax bill due to the loan forgiveness. The plaintiff, a public interest lawyer at the Pacific Legal Foundation, has until October 10 to file a revamped lawsuit.

    The nonpartisan Congressional Budget Office said in a report released last week that the student loan cancellation could come at a price of $400 billion but noted that those estimates are still “highly uncertain.”

    The Biden administration argues that the CBO’s cost estimate should be viewed over a 30-year time period and came out with its own analysis two days later. It said the program will cost an average of $30 billion per year over the next decade and $379 billion over the course of the program.

    The Department of Education is warning borrowers of scams related to the student loan forgiveness program that ask for payment in return for help getting debt relief.

    “Make sure you work only with the US Department of Education and our loan servicers, and never reveal your personal information or account password to anyone,” it said in an email to borrowers.

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  • Black residents in 2 Florida neighborhoods raise questions about hurricane relief efforts and say they’ve been left out | CNN

    Black residents in 2 Florida neighborhoods raise questions about hurricane relief efforts and say they’ve been left out | CNN

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    CNN
     — 

    Latronia Latson said she feels like she has been neglected in the recovery efforts from Hurricane Ian.

    Latson, who lives in the Dunbar neighborhood in Fort Myers, Florida, said she can’t get to a relief center to get bottled water and other necessities being distributed because she doesn’t have transportation; the bus system is not running in her neighborhood. Her stove and microwave also mysteriously stopped working after the hurricane, despite power being restored.

    Latson said the more affluent, predominately White communities seem to be getting prioritized in the storm recovery.

    “They need to make it convenient for those that don’t have transportation,” said Latson, who is disabled. “We just don’t get the same service (as people in other parts of town).”

    Latson is among the residents and community leaders in Florida who say the poor, majority Black neighborhoods of Dunbar and River Park in Naples are forgotten as rescue and relief teams descend on the areas hit by Hurricane Ian last week.

    The residents say they were among the last to get their power restored and shelters and relief centers are being set up too far away for people who don’t have access to vehicles.

    Officials in Fort Myers did not immediately provide a response to these concerns when contacted by CNN.

    The city of Naples released a statement on Thursday outlining its efforts to assist the River Park community since the storm. The statement said officials opened a comfort center at the River Park Community Center on Sept. 29 that provided access to phone charging, air conditioning, water, ice and restrooms. Additionally the city said staff members visited River Park to speak with residents, developed a plan for debris removal, transported residents to shelters and partnered with local groups to serve and deliver hot meals, water and clothing to the community.

    Yet Black residents’ complaints and questions about the warnings and response lay bare the racial disparities in natural disaster recovery each time a major storm affects part of the country. Several studies found that the Federal Emergency Management Agency provides less aid to people of color facing disaster relief compared to White people. Poor communities and communities of color are also often built in locations that are more physically vulnerable to extreme weather events and have less investment in their infrastructure, experts say.

    Vice President Kamala Harris acknowledged the inequity when she spoke last week at the National Committee Women’s Leadership Forum.

    “It is our lowest-income communities and our communities of color that are most impacted by these extreme conditions and impacted by issues that are not of their own making,” Harris said. “And so we have to address this in a way that is about giving resources based on equity.”

    Deanne Criswell, FEMA administrator, agreed that there are barriers to receiving federal resources. Criswell said on CBS’ “Face the Nation” earlier this week that her office is working to create more equitable access to FEMA’s disaster relief programs.

    “One of our focus areas since I’ve been in office is to make sure that we’re removing those barriers,” Criswell said. “So these people that need our help the most are going to be able to access the help that we offer.”

    Black activists and residents in Florida are pleading for more help from officials.

    Vincent Keeys, president of the Collier County NAACP, said residents in River Park were already more vulnerable because it is a coastal community. The city of Naples, Keeys said, has worked to gentrify the area in recent years but has not built a sea wall that could provide more protection during hurricanes.

    Some residents complained that they never even received a notification to evacuate their homes ahead of the storm, Keeys said.

    The timing of evacuation orders has been a point of contention for Florida officials since the storm. Florida Gov. Ron DeSantis said officials in Lee County, where Dunbar sits, acted appropriately when they issued their first mandatory evacuations less than 24 hours before Hurricane Ian made landfall on the state, and a day after several neighboring counties issued their orders. Lee County officials have faced mounting questions about why the first mandatory evacuations weren’t ordered until a day before Ian’s landfall – despite an emergency plan that suggests evacuations should have happened earlier.

    The city of Naples said in its statement Thursday that it issued mandatory evacuation notices to residents via email, the CodeRed system, social media and a press release sent to media outlets.

    In River Park, many homes suffered 4 to 6 feet of flooding, downed trees and structural damage. Keeys said there are no shelters in close proximity to the neighborhood, leaving residents with nowhere to go if their homes are uninhabitable.

    “Please, you cannot put our people in a flood prone situation and expect them to survive,” Keeys said. “At least, if humanly possible, help us improve, plan and make things better for human beings.”

    Sharda Williams, of River Park, said she never received an evacuation order but people in nearby communities were told to leave. “No one came to our neighborhood and told us to get out,” Williams said. “Not one person.”

    Now Williams said all she can do is “sit and wait until the help comes through.”

    “You try and do what you can and that’s why, you know, we’re all pitching together and trying to help each other with what we can,” she said.

    Curtis Williams (no relation to Sharda), another River Park resident, was also frustrated he didn’t get an evacuation order.

    “Not one city employee, police or whatever, came through the neighborhood before the flood water and said there was a mandatory evacuation, not one,” he said. “They could have easily rode down here with a bullhorn, before the storm, and say ‘you people need to vacate.’ They didn’t do that.”

    However, Naples said in its statement that the city’s first responders were trapped and its fire station was flooded. As a result, the North Collier Fire Rescue (NCFR) team responded to the River Park community with the high water vehicle. NCFR drove three vehicle loads of residents to high ground, which was at the Coastland Center Mall. Numerous people in the area were trapped and the city said its goal was to get everyone to safety and high ground.

    More than 100 miles away in Dunbar, one pastor said while the Black community hasn’t received much support from officials, residents are leaning on each other to get through the recovery.

    “We are trying to give some moral support, you know, with our neighbors and friends,” said Pastor Nicles Emile of Galilee Baptist Church. “We are working on helping our neighbors as much as we can and I can say that whatever we have and share with them.”

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  • Opinion: The Fed doesn’t have a choice anymore. Get ready for a recession | CNN Business

    Opinion: The Fed doesn’t have a choice anymore. Get ready for a recession | CNN Business

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    Editor’s Note: Gad Levanon is the chief economist at the Burning Glass Institute. He’s the former head of The Conference Board’s Labor Market Institute. The opinions expressed in this commentary are his own.

    To many economists and analysts, the US economy has represented a paradox this year. On the one hand, GDP growth has slowed significantly, and some argue, even entered a recession. On the other hand, overall employment growth has been much stronger than normal.

    While GDP declined at an annualized rate of 1.1% in the first half of 2022, the US economy added 2.3 million jobs in the last six months, far more than in any other six-month period in the 20 years prior to the pandemic.

    This tight labor market – and the rapid wage growth it has spurred – is causing inflation to become more entrenched. The Consumer Price Index, which measures a basket of goods and services, was 8.3% year-over-year in August. That’s lower than the 40-year high of 9.1% in June, but still painfully high. To address it, the Federal Reserve is likely to drive the economy into a recession in 2023, crushing continued job growth.

    Why has employment growth remained so strong? First, the US economy is holding on better than many expected. The Atlanta Fed’s GDPNow estimate for real GDP growth in the third quarter of 2022 is 2.3%, suggesting that while the economy is now growing much more slowly than it did last year, we are still not in a recession. When the demand for goods and services strengthens, so does the demand for workers producing these goods and services.

    Second, despite the slowing of the economy and the growing fears of recession, layoffs are still historically low. Initial claims for unemployment insurance, an indicator highly correlated with layoffs, were 219,000 for the week ended October 1 – higher than the week prior, but still one of the lowest readings in recent decades. After years of increasingly traumatic labor shortages, many employers are reluctant to significantly reduce the number of workers even as their businesses are slowing. That’s because companies are worried that they will have trouble recruiting new workers when they start expanding again.

    Third, many industries are growing faster than normal because they are still recovering from the pandemic. Convention and trade show organizers, car rental companies, nursing homes and child day care services, among others, are all growing fast because they are still well below pre-pandemic employment levels.

    Fourth, just as some industries are growing because they are still catching up, others are experiencing high growth as they adjust to a new normal of higher demand. Demand for data processing and hosting services, semiconductor manufacturing, mental health services, testing laboratories, medical equipment and pharmaceutical manufacturing is higher than before the pandemic. And it’s likely that these represent structural changes to buying patterns that will keep demand high.

    Fifth, during the pandemic, corporate investments in software and R&D reached unprecedented levels, which drove a rapid increase in new STEM jobs. Because these workers are especially well paid, they have had plenty of disposable income to spend on goods and services, which has supported job growth throughout the economy.

    These factors are spurring positive momentum that will not disappear overnight. Employment growth is likely to slow down from its historically high rates, but it will still remain solid in the coming months. ManpowerGroup’s Employment Outlook Survey shows that the hiring intentions for the fourth quarter are still very high, despite dropping from the previous quarter.

    Next year, however, will look very different. Many of the industries that are still recovering from the pandemic will have reached pre-pandemic employment levels. With demand saturated, those industries may revert to slower hiring. But this alone is unlikely to push job growth into negative territory. What will do that is monetary policy.

    There are two ways to rein in the labor market: Either reduce demand for workers or increase the labor supply. But it’s hard to engineer a boost in labor supply. That takes the kind of legislative action needed to increase immigration, drive people into the labor force or grow investment in workforce training. This is likely to prove elusive in today’s polarized political environment.

    The only option that leaves the Fed is to engineer a recession by continuing to raise interest rates. Expect to see that happen in 2023.

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  • Kelly warns ‘wheels’ could ‘come off our democracy’ while Masters tries to tie him to Biden in Arizona Senate debate | CNN Politics

    Kelly warns ‘wheels’ could ‘come off our democracy’ while Masters tries to tie him to Biden in Arizona Senate debate | CNN Politics

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    CNN
     — 

    While trying to distance himself from his own party, Arizona Democratic Sen. Mark Kelly warned during an hour-long debate on Thursday that the “wheels” could “come off our democracy” if candidates like his GOP opponent, Trump-backed Blake Masters, are elected in November.

    But Masters aggressively pushed back on those attacks, portraying Kelly, who’s running for a full six-year term, as a rubber stamp for the Biden administration, while refusing to acknowledge that he has attempted to moderate his positions on abortion and the 2020 presidential election.

    The Arizona Senate race is among the most competitive in the country, and with the chamber currently split 50-50, every race matters. But Kelly appears to have strengthened his position over the past two months as Masters has struggled to keep up with the Democrat’s fundraising prowess. A new CNN poll released Thursday found that 51% of likely voters are behind Kelly, with 45% backing Masters.

    Masters – a venture capitalist and political novice who won the primary in large part because of former President Donald Trump’s endorsement and the financial backing of billionaire Peter Thiel (his former boss) – released a campaign video last year proclaiming that he believed Trump won the 2020 election. But after the primary, he removed language from his website that included the false claim that the election was stolen.

    Masters attempted to maneuver around questions about the election during Thursday’s debate – just days before Trump, whose 2020 loss in Arizona set off a cascade of election denialism in the state, heads there to campaign for Masters and other Republicans.

    When the moderator asked him whether President Joe Biden, who narrowly carried Arizona, is the “legitimately elected President of the United States,” Masters replied: “Joe Biden is absolutely the President. I mean, my gosh, have you seen the gas prices lately?”

    “Legitimately elected?” the moderator interjected.

    “I’m not trying to trick you,” Masters said. “He’s duly sworn and certified. He’s the legitimate president. He’s in the White House and unfortunately for all of us.”

    When the moderator followed up by using Trump’s language, asking whether the election was “stolen” or “rigged in any way” through vote counting or election results, Masters replied: “Yeah, I haven’t seen evidence of that.”

    But Kelly argued that Masters has espoused “conspiracies and lies that have no place in our democracy.”

    “I’m worried about what’s going to happen here,” Kelly said. “This election in 2024. I mean, we could wind up in a situation where the wheels come off of our democracy, and it’s because of folks like like Blake Masters that are questioning the integrity of an election.”

    Masters insisted that he does not want to get rid of mail-in voting as Kelly alleged. He said he believed military service members should be able to mail ballots back from overseas and said he’d be fine with other voters sending their ballots back by mail if they included a copy of their driver’s license.

    Masters and Kelly repeatedly clashed over immigration, with Masters claiming Kelly supports “open borders” and Kelly rejecting those attacks as he insisted that he’s brought more resources to Arizona to deal with that issue.

    When asked whether he had done enough to address immigration concerns, Kelly distanced himself from national Democrats.

    “When I got to Washington, DC, one of the first things I realized was that Democrats don’t understand this issue. And Republicans just want to talk about it, complain about it, but actually not do anything about it. They just want to politicize that. We heard this tonight from my opponent Blake Masters.”

    Masters charged that Biden and Kelly have put out “the welcome mat” to migrants. “We treat these people better than we treat our own US military service members. I find that shameful.”

    Kelly said he’s pushed back on the Biden administration multiple times on immigration issues, including when the administration planned to end Title 42, the pandemic-era policy that allowed border patrol agents to send migrants back to their home countries.

    “I’ve stood up to Democrats when they’re wrong on this issue … including the President.”

    “When the President decided he was going to do something dumb on this, and change the rules,” Kelly said, “I told him he was wrong.”

    Some of the sharpest exchanges were over abortion as the moderator and Libertarian candidate Marc Victor drew attention to the fact that Masters scrubbed some of the language about his anti-abortion stances from his website as he tried to pivot toward the general election.

    Abortion rights have been a subject of fierce controversy in Arizona since the Supreme Court struck down Roe v. Wade, because there are conflicting abortion laws in the state – leading to debate over which one should take precedence.

    The state legislature passed a 15-week ban earlier this year that does not include exceptions for rape or incest, only medical emergencies. Masters has said he supports that plan, which was signed into law by Republican Gov. Doug Ducey.

    But Arizona also had a pre-statehood law on the books banning nearly all abortions that was enjoined in 1973 after the Roe decision. A Pima County Superior Court judge recently ruled that it could go back into effect at the urging of the state’s GOP attorney general.

    Kelly argued that Masters wants to make decisions for Arizona women and curtail their rights. “I think we all know guys like this,” said Kelly, also faulting Masters for supporting a national ban on abortion at 15 weeks that has been proposed by South Carolina Sen. Lindsey Graham.

    “You know, guys that think they know better than everyone about everything,” Kelly continued.

    “What I’m doing is I am protecting your constitutional rights,” he added.

    When the moderator pressed Kelly to explain what limits he would support on abortion, Kelly said he supports the kind of framework contemplated by the Roe v. Wade decision where “late term abortion in this country only happens when there is a serious problem.”

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  • Proud Boys member is first to plead guilty to seditious conspiracy | CNN Politics

    Proud Boys member is first to plead guilty to seditious conspiracy | CNN Politics

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    CNN
     — 

    Jeremy Bertino, a top lieutenant to Proud Boys leader Enrique Tarrio, pleaded guilty to seditious conspiracy in federal court on Thursday, and is cooperating with the Justice Department’s investigation into the far-right extremist group.

    Bertino, 43, also pleaded guilty to unlawful possession of a firearm by a prohibited person. He is the first member of the Proud Boys to plead guilty to seditious conspiracy – a major boost to the historic prosecution of the organization.

    He could spend more than five years in prison, according to his plea agreement, which was read aloud in court, though prosecutors could ask a judge for a lesser sentence depending on his level of cooperation with the investigation.

    The judge did not set a sentencing date. Bertino’s next hearing is scheduled for February 2023. Bertino will not be held in jail. He will not be able to have a passport or firearms, and will not be able to return to Washington unless it is to meet with prosecutors or participate in court proceedings.

    Bertino was listed in previous indictments as “PERSON-1,” but has not publicly faced charges. He is not alleged to have been in Washington, DC, on January 6, 2021. Prosecutors have previously outlined his involvement in Proud Boys leadership and extensive planning meetings and chats.

    Even though he was not present for the Capitol riot, Bertino could provide crucial testimony for prosecutors in the Proud Boys seditious conspiracy trial, which is set to begin in December of this year.

    According to the Proud Boys seditious conspiracy indictment, Bertino was in a number of encrypted group chats meant to plan for January 6. The groups, including the main “Boots on Ground” channel, included all of the Proud Boys sedition defendants – Tarrio, Ethan Nordean, Joseph Biggs, and Zachary Rehl. They have pleaded not guilty.

    Bertino posted instructions for January 6 in the chats, prosecutors say, telling Proud Boys where to meet and to not wear the usual Proud Boys colors, though he ultimately did not travel to Washington because he was recovering from a stab injury from a previous DC rally.

    After 1 p.m. on January 6, Bertino, along with another member of the group posted messages in a Proud Boys chat to “Push inside! Find some eggs and rotten tomatoes!” and asking if “they deploy the mace yet,” according to the indictment.

    Bertino posted publicly to rioters, writing “DO NOT GO HOME. WE ARE ON THE CUSP OF SAVING THE CONSTITUTION.”

    Bertino also texted Tarrio on the evening of January 6, saying: “Brother. You know we made this happen” and “I’m so proud of my country today,” according to the indictment. “I know,” Tarrio allegedly replied.

    According to prosecutors, Bertino later replied “1776 motherf*****s” to Tarrio, adding later “Dude. Did we just influence history?”

    “They HAVE to certify today!” Bertino allegedly texted. “Or it’s invalid.”

    The same day Tarrio was arrested in March 2022, investigators executed a search warrant at Bertino’s house, according to court documents. Agents found six firearms, including an AR-15 rifle with a scope, and more than 3,000 rounds of ammunition, prosecutors said. Bertino had previously been convicted of a felony and was not allowed to own a firearm.

    Bertino previously testified to the House select committee investigating January 6, and a clip of his testimony was played at a public hearing in June.

    The committee used a clip from Bertino’s deposition to show how former President Donald Trump’s call for the Proud Boys to “stand back and stand by” during a 2020 presidential debate when asked if he was willing to condemn White supremacists and militia groups in turn energized individuals from the Proud Boys and other extremist groups.

    When asked if the membership to the Proud Boys increased after Trump’s “stand back and stand by” comment, Bertino testified, “Exponentially. I’d say tripled probably. With a potential for a lot more probably.”

    He also may be eligible for witness protection, according to his plea agreement.

    CORRECTION: An earlier version of this story incorrectly stated the year of Enrique Tarrio’s arrest and the search of Jeremy Bertino’s residence. The events took place in March 2022. This story has also been updated with additional details.

    Jan. 6: Proud Boys, Oath Keepers

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  • The real-life ‘Inventing Anna’ could be released from jail soon. She’s still fighting deportation | CNN

    The real-life ‘Inventing Anna’ could be released from jail soon. She’s still fighting deportation | CNN

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    CNN
     — 

    A judge has ruled that Anna Sorokin, the fake heiress Netflix’s “Inventing Anna” is based on, can be released from jail on bond while she fights deportation – if certain conditions are met.

    According to court records, Immigration Judge Charles Conroy found this week that Sorokin can be released on $10,000 bond from Immigration and Customs Enforcement custody. But he also ruled that she must remain confined 24 hours a day at a residential address and refrain from accessing any social media platform either directly or through a surrogate while her case continues.

    “This ruling does not mean that Anna will get a free pass. She will continue to face deportation proceedings and her release will be closely monitored by ICE and the State of New York,” attorney John Sandweg, a former acting director of ICE who’s one of Sorokin’s attorneys, said in a statement Thursday. “As the Court found, however, the evidence clearly demonstrated that any risks can be more than adequately mitigated by appropriate supervision.”

    The judge’s ruling also says ICE may use an ankle monitor to keep tabs on Sorokin once she’s released.

    As of Thursday afternoon, the 31-year-old Sorokin remained in ICE custody, a spokesman for the agency said.

    She’s been in ICE custody for 17 months, according to her attorney – mostly at the Orange County Correctional Facility in upstate New York.

    Sorokin was found guilty of stealing more than $200,000 from banks and friends while scamming her way into New York society, the Manhattan District Attorney said after her 2019 conviction.

    Her case drew widespread attention after a 2018 New York magazine article.

    That article became the basis of Shonda Rhimes’ “Inventing Anna,” a dramatization that released on Netflix in February and quickly became one of the streamer’s most popular shows. Actress Julia Garner, best known for her Emmy-winning role as Ruth on “Ozark,” played Sorokin.

    The show ends with Sorokin’s conviction. But in real life, the drama has continued.

    Sorokin was released from jail in February 2021 after serving nearly four years on theft and larceny charges. But it wasn’t long before she ended up back behind bars.

    ICE took custody of Sorokin on March 25, 2021. In November, the Board of Immigration Appeals granted an emergency stay in her case, according to ICE. She’s been fighting her deportation – and also joined a group of plaintiffs suing the agency earlier this year, alleging they’d requested and been denied Covid booster shots while in custody. They dropped their lawsuit in March after receiving the shots, according to court records.

    While she’s been detained, frequent posts have been made on Sorokin’s social media accounts. Recently they’ve featured Sorokin’s artwork, which was featured in a New York show in May.

    Earlier this year an attorney representing Sorokin told NBC News that he feared her deportation when he couldn’t reach her, but word later emerged that she was still in ICE custody.

    Soon afterward, Sorokin spoke out from behind bars, telling the “Call Her Daddy” podcast that she never claimed to be a German heiress.

    “I was from Germany, which was true, but nobody ever asked me about my job,” Sorokin said. “Nobody asks who are your parents and how much money do they make. It’s just outrageous.”

    She told host Alex Cooper that she never “told any senseless lies.”

    But she admitted – sort of – to lying about her status and background.

    “I guess I did,” she said. “I mean, I cannot tell an exact instance, but I’m sure.”

    Sorokin also said she was surprised by the public’s fascination with her story.

    “It was just really a surprise to me that people would be, like, so interested in the way I went about the things, because it just made so much sense to me,” she said.

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  • Mortgage rates take a breather after rising for several weeks in a row | CNN Business

    Mortgage rates take a breather after rising for several weeks in a row | CNN Business

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    After rising for six weeks in a row, mortgage rates retreated last week.

    The 30-year fixed-rate mortgage averaged 6.66% in the week ending October 5, down from 6.70% the week before, according to Freddie Mac.

    Mortgage rates have more than doubled since the start of this year as the Federal Reserve continues its unprecedented campaign of hiking interest rates in order to tame soaring inflation. But uncertainty about the possibility of a recession and the impact of rate hikes on the economy have made mortgage rates more volatile.

    “Mortgage rates decreased slightly this week due to ongoing economic uncertainty,” said Sam Khater, Freddie Mac’s chief economist. “However, rates remain quite high compared to just one year ago, meaning housing continues to be more expensive for potential homebuyers.”

    The average mortgage rate is based on a survey of conventional home purchase loans for borrowers who put 20% down and have excellent credit, according to Freddie Mac. But many buyers who put down less money upfront or have less than perfect credit will pay more.

    Investors and analysts have been scrutinizing each piece of economic data, searching for clues about the Fed’s next steps and the future of the US and global economies, said Danielle Hale, Realtor.com’s chief economist.

    The Fed does not set the interest rates borrowers pay on mortgages directly, but its actions influence them. Mortgage rates tend to track the yield on 10-year US Treasury bonds. As investors see or anticipate rate hikes, they often sell government bonds, which sends yields higher and mortgage rates rise.

    Over the past month, yields on 10-year Treasuries soared from 3.25% to nearly 4% before falling back around 3.75% this week.

    Hale likened investors’ actions to a driver navigating a road in dense fog, prone to over-correcting at each turn.

    “Signs that we are closer to the end of the tightening cycle – such as a surprisingly steep decline in job openings – tend to cause rates to slip, while rates bounce higher on signals like robust activity in the services sector,” Hale said.

    Even though rates dipped slightly this week, the average interest rate for a 30-year, fixed-rate loan is still more than double what it was at this time last year.

    A year ago, a buyer who put 20% down on a $390,000 home and financed the rest with a 30-year, fixed-rate mortgage at an average interest rate of 2.99% had a monthly mortgage payment of $1,314, according to calculations from Freddie Mac.

    Today, a homeowner buying the same-priced house with an average rate of 6.66% would pay $2,005 a month in principal and interest. That’s $691 more each month.

    As rates have been rising over the last several weeks, fewer people have been applying for mortgages said Bob Broeksmit, president and CEO of the Mortgage Bankers Association.

    Ongoing economic uncertainty together with Hurricane Ian’s devastation in Florida resulted in a 14% decline in mortgage applications last week from the week before, he said.

    MBA also found that an increasing number of borrowers are applying for adjustable rate mortgages, or ARMs. Applications for ARMs climbed to nearly 12% of all applications last week.

    The average rate for the ARM tracked by Freddie Mac (a 5-year Treasury-indexed hybrid ARM) was 5.36%, more than a percentage point lower than the 30-year fixed rate.

    “While rate increases are needed to tame inflation and alleviate the burden it places on household budgets, higher borrowing costs have caused consumers to think twice about major purchases like homes and cars,” said Hale.

    With more prospective buyers sitting on the sidelines, those still looking to buy have a little more breathing room.

    Correction: “Today’s home shoppers have more choices, but for many, the increased cost of financing and higher home prices mean fewer affordable options,” Hale said. “As challenging as it may be to set and stick to a budget in this environment of rising prices and rates, it’s more important than ever to do so.”
    A previous version of this story misstated the number of weeks mortgage rates have been rising. Rates rose for six consecutive weeks before falling this week.

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  • Election denier Kari Lake has a real shot of winning a swing state governorship | CNN Politics

    Election denier Kari Lake has a real shot of winning a swing state governorship | CNN Politics

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    CNN
     — 

    One of the big questions heading into the 2022 cycle had been how Republican candidates would or not reflect the GOP base when it came to views of the 2020 election. Poll after poll has shown that a clear majority of Republicans falsely believe that President Joe Biden did not legitimately win the 2020 election.

    Perhaps it shouldn’t be a surprise, then, that a lot of Republicans running for office believe this as well. But could any of of those candidates end up running states where elections tend to be close? For the most part, the answer is no. Most election deniers running for governor have only a small chance of winning or are from states former President Donald Trump easily won.

    There is one big exception: GOP gubernatorial nominee Kari Lake of Arizona. In the second-closest state of the 2020 presidential election, Lake is neck and neck with Democratic nominee Katie Hobbs.

    Three polls out this past week, which were all well within the margin of error, illustrate the point well. A CBS News/YouGov poll had Lake and Hobbs tied at 49%. Fox’s poll put Hobbs at 44% to Lake’s 43%. Marist College had Lake at 46% and Hobbs at 45%.

    These polls are representative of the average of all polling that has the candidates running basically even.

    Lake is running considerably stronger than Blake Masters, the the state’s GOP nominee for US Senate. Masters trails his Democratic opponent, Sen. Mark Kelly, by more than 5 points in in the average of all polling.

    You might be thinking that Masters is somehow more extreme than Lake. That’s not clear at all, at least when it comes to the 2020 election.

    On that issue, Lake – like Masters – is an election denier. Indeed, that’s what makes Lake so unique. There are other Republicans who are in a position to win the governorship of close 2020 states this year, and nearly all of them have either tried to have it both ways on the most recent presidential election (i.e. raising doubts about the legitimacy, but not saying it was stolen) or have accepted the 2020 results.

    The other full-out election deniers running for governor in 2020 swing states this year are Tudor Dixon in Michigan and Doug Mastriano in Pennsylvania. Both trail their Democratic opponents – Michigan Gov. Gretchen Whitmer and Pennsylvania Attorney General Josh Shapiro, respectively – by double digits in the average of polls. Mastriano is now running well behind the Republican nominee for Senate in Pennsylvania, Mehmet Oz, despite Oz stumbling out of the gate after the primary. (Oz, who was endorsed by Trump in the primary, said he would have voted to certify the 2020 election result.)

    In fact, 2020 election denial has been a hallmark of losing gubernatorial campaigns in swing or blue states. Blue-state Republicans Dan Cox in Maryland and Geoff Diehl in Massachusetts are getting blown out by their opponents in the polls, even though the current and departing governors of their respective states are Republicans.

    You might be tempted to think that Lake has a chance because voters in the Grand Canyon State believe the 2020 election was stolen. That does not appear to be the case. An August Fox poll found that only 28% of voters were not at all confident that votes in the 2020 election were cast legitimately and counted fairly.

    Additionally, the Marist poll showed that a mere 6% of voters are not at all confident that the 2022 election in Arizona will not be run fairly and accurately. Another 23% are not very confident; the vast majority (71%) are confident it will be.

    So what is Lake’s secret? Part of it may be that her past as a television anchor is paying off. She seems to be doing a good enough job reaching voters in the middle of the electorate.

    Lake needs merely to stay competitive with independents to win Arizona. Unlike many other battleground states, a plurality of Arizona voters are Republican. This means Democratic candidates usually need some mixture of winning more Republican voters than Republican candidates winning Democratic voters and winning independents by a wide margin. Put another way, Lake can win even if she loses independents and retains less of her base than Hobbs.

    In the Marist poll, for example, Kelly holds a 17-point lead with independents. Hobbs is up just 2 points among them.

    But Lake’s standing may have more to do with the fact that 2020 election denialism isn’t as much of an important factor to voters as we might think when it comes to voting in elections for state office. While just 18% of voters said in the CBS News poll that they wanted elected officials in Arizona to say Biden didn’t win in 2020, another 41% said it didn’t matter. This means the majority of Arizona voters (59%) don’t seem to mind or actually like it when someone running for office denies the reality of the 2020 election.

    A further look at the numbers indicates that the GOP could easily win the secretary of state races in Arizona (Mark Finchem) and in next-door Nevada (Joe Marchant). The Republicans running for both those posts have denied the results of the 2020 election as they aim to become the chief election officers in their given states.

    It’s also the case that Wisconsin Sen. Ron Johnson voted against certifying the 2020 election and is a slight favorite to win another term against Democratic Lt. Gov. Mandela Barnes. Likewise, Nevada’s Adam Laxalt has raised questions about the 2020 election and played a leading role in post-election legal efforts to reverse Biden’s victory in the state. He’s in a tight race with Democratic Sen. Catherine Cortez Masto.

    Neither of those GOP Senate candidates are vying to lead a swing state, though. And the name recognition for the aforementioned secretary of state candidates is significantly lower than it is for Lake.

    Lake is quite competitive as an election denier, despite being well known and running for a real position of power when it comes to elections. If she and Finchem win, the two officials in charge of election certification in Arizona will be on the record denying the reality of the 2020 election.

    That could be quite a big deal in two years’ time, if another close presidential election – like 2020’s between Biden and Trump – is on the line and Arizona is once again in the mix.

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  • First on CNN: Barnes raises more than $20 million in third quarter of closely watched Wisconsin Senate race | CNN Politics

    First on CNN: Barnes raises more than $20 million in third quarter of closely watched Wisconsin Senate race | CNN Politics

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    CNN
     — 

    Democratic Senate candidate Mandela Barnes raised more than $20 million in the third quarter of 2022, according to details from the Wisconsin lieutenant governor’s campaign, dwarfing what he raised throughout his entire bid for Senate.

    Barnes is aiming to unseat Sen. Ron Johnson, the Republican incumbent who is seeking a third term, in what has become one of the most closely watched Senate campaigns of the midterms. With an evenly divided Senate, every race this November could tilt the balance of power in the legislative body, but Barnes’ race against Johnson represents one of the best chances for Democrats to flip a Senate seat this cycle.

    The race has been tight for months. A Marquette University Law School Poll, released in mid-September, found 49% of likely voters in Wisconsin supported Johnson, compared to 48% who backed Barnes – a statistical dead heat. But the poll was an improvement for Johnson: The same poll had found Barnes at 52% in August with the incumbent at 45%.

    Barnes’ fundraising haul should help Democrats level the advertising playing field in the race after being outspent in September.

    According to AdImpact, Republicans spent nearly $22.5 million on ads in September, compared to $16.5 million for Democrats. The biggest spenders in the race over that time was Senate Leadership Fund, the Republican super PAC with close ties to Senate Minority Leader Mitch McConnell. The group spent nearly $8 million in September. Senate Majority PAC, the predominant Democratic super PAC focused on Senate races, spent just over $6 million.

    While Republicans spend money hammering him on crime, Barnes has attempted to focus his campaign on the major issue motivating Democratic voters in 2022 in the wake of June’s Supreme Court decision overturning Roe v. Wade: Abortion.

    “I’m proud of the grassroots coalition we’ve built across Wisconsin,” Barnes said in a statement to CNN. “Over this final stretch we’ll keep going everywhere and holding Ron Johnson accountable for his record of supporting a dangerous abortion ban with no exceptions for rape, incest, or the life of the woman. He’s out of touch with Wisconsin values and we’re going to send him packing.”

    The Democrat recently launched a statewide tour the campaign has dubbed “Ron Against Roe,” an effort it hopes will take advantage of opposition to the June Supreme Court ruling. Marquette’s polling found more than 60% of Wisconsin voters opposed that decision. Barnes also rolled out a new ad that attacks Johnson for supporting a 2011 bill that was introduced by Mississippi Sen. Roger Wicker that would have enshrined “the right to life” upon conception.

    “It’s Johnson’s views that are alarming. Johnson supported a ban on abortion, he cosponsored a bill that makes no exceptions for rape or incest or the life of the woman. And Johnson said if women don’t like it, they can move,” a narrator says in a new Barnes ad.

    Johnson has since tried to push back against the abortion attacks by saying he believes the issue should be left to Wisconsin voters, including by updating an 1849 law that bans nearly all abortions to include exceptions for rape, incest or if the life of the mother is at stake. But Johnson backed the Supreme Court’s overturning of Roe v. Wade and has numerous times put his name on a bill that would make it illegal to perform an abortion 20 weeks after conception.

    While Barnes focuses on abortion, Johnson’s campaign has been laser focused on attacking the Democrat over crime, including touting endorsements from law enforcement organizations and running ads tying Barnes to efforts to “defund the police.”

    “Mandela Barnes: Dangerously liberal on crime,” a narrator says in a recent ad before showing Johnson standing next to a police officer.

    Ben Voelkel, a spokesman for Johnson, responded to Barnes’ fundraising haul by saying, “All the out of state liberal money in the world can’t change the fact Mandela Barnes supports the Defund the Police and Abolish ICE movements, wants to cut the prison population in half and backs the same Biden economic policies that have led to 40-year high inflation and record gas prices.”

    Barnes has responded by refuting the defund accusations, including with an ad that shows a retired sergeant for the Racine Police Department testifying that Barnes “does not want to defund the police.”

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  • The bond market is crumbling. That’s bad for Wall Street and Main Street | CNN Business

    The bond market is crumbling. That’s bad for Wall Street and Main Street | CNN Business

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    A version of this story first appeared in CNN Business’ Before the Bell newsletter. Not a subscriber? You can sign up right here. You can listen to an audio version of the newsletter by clicking the same link.


    New York
    CNN Business
     — 

    The global bond market is having a historically awful year.

    The yield on the 10-year US Treasury bond, a proxy for borrowing costs, briefly moved above 4% on Wednesday for the first time in 12 years. That’s a bad omen for Wall Street and Main Street.

    What’s happening: This hasn’t been a pretty year for US stocks. All three major indexes are in a bear market, down more than 20% from recent highs, and analysts predict more pain ahead. When things are this bad, investors seek safety in Treasury bonds, which have low returns but are also considered low-risk (As loans to the US government, Treasury notes are seen as a safe bet since there is little risk they won’t be paid back).

    But in 2022’s topsy-turvy economy, even that safe haven has become somewhat treacherous.

    Bond returns, or yields, rise as their prices fall. Under normal market conditions, a rising yield should mean that there’s less demand for bonds because investors would rather put their money into higher-risk (and higher-reward) stocks.

    Instead markets are plummeting, and investors are flocking out of risky stocks, but yields are going up. What gives?

    Blame the Fed. Persistent inflation has led the Federal Reserve to fight back by aggressively hiking interest rates, and as a result the yields on US Treasury bonds have soared.

    Economic turmoil in the United Kingdom and European Union has also caused the value of both the British pound and the euro to fall dramatically when compared to the US dollar. Dollar strength typically coincides with higher bond rates as well.

    So while we’d normally see a rising 10-year yield as a signal that US investors have a rosy economic outlook, that isn’t the case this time. Gloomy investors are predicting more interest rate hikes and a higher chance of recession.

    What it means: Portfolios are aching. Vanguard’s $514.5 billion Total Bond Market Index, the largest US bond fund, is down more than 15% so far this year. That puts it on track for its worst year since it was created in 1986. The iShares 20+ Year Treasury bond fund

    (TLT)     (TLT) is down nearly 30% for the year.

    Stock investors are also nervously eyeing Treasuries. High yields make it more expensive for companies to borrow money, and that extra cost could lower earnings expectations. Companies with significant debt levels may not be able to afford higher financing costs at all.

    Main Street doesn’t get a break, either. An elevated 10-year Treasury return means more expensive loans on cars, credit cards and even student debt. It also means higher mortgage rates: The spike has already helped push the average rate for a 30-year mortgage above 6% for the first time since 2008.

    Going deeper: Still, investors are more nervous about the immediate future than the longer term. That’s spurred an inverted yield curve – when interest rates on short-term bonds move higher than those on long-term bonds. The inverted yield curve is a particularly ominous warning sign that has correctly predicted almost every recession over the past 60 years.

    The curve first inverted in April, and then again this summer. The two-year treasury yield has soared in the last week, and now hovers above 4.3%, deepening that gap.

    On Monday, a team at BNP Paribas predicted that the inverted gap between the two-year and 10-year Treasury yields could grow to its largest level since the early 1980s. Those years were marked by sticky inflation, interest rates near 20% and a very deep recession.

    What’s next: The bond market may face fresh volatility on Friday with the release of the Federal Reserve’s favored inflation measure, the Personal Consumption Expenditure Price Index for August. If the report comes in above expectations, expect bond yields to move even higher.

    The Bank of England held an emergency intervention to maintain economic stability in the UK on Wednesday. The central bank said it would buy long-dated UK government bonds “on whatever scale is necessary” to prevent a market crash.

    Investors around the globe have been dumping the British pound and UK bonds since the government on Friday unveiled a huge package of tax cuts, spending and increased borrowing aimed at getting the economy moving and protecting households and businesses from sky-high energy bills this winter, reports my colleague Mark Thompson.

    Markets fear the plan will drive up already persistent inflation, forcing the Bank of England to push interest rates as high as 6% next spring, from 2.25% at present. Mortgage markets have been in turmoil all week as lenders have struggled to price their loans. Hundreds of products have been withdrawn.

    “This repricing [of UK assets] has become more significant in the past day — and it is particularly affecting long-dated UK government debt,” the central bank said in its statement.

    “Were dysfunction in this market to continue or worsen, there would be a material risk to UK financial stability. This would lead to an unwarranted tightening of financing conditions and a reduction of the flow of credit to the real economy.”

    Many final salary, or defined-benefit, pension funds were particularly exposed to the dramatic sell-off in longer dated UK government bonds.

    “They would have been wiped out,” said Kerrin Rosenberg, UK chief executive of Cardano Investment.

    The central bank said it would buy long-dated UK government bonds until October 14.

    Steep drops in bond prices may be signaling doom and gloom for the economy, but some analysts say short-term bonds are still looking more attractive than equities right now.

    “Record low yields have kept fixed income in the shadow of equities for decades,” said analysts at BNY Mellon Wealth Management in a research note. “But the aggressive shift in Fed policy is beginning to change this.”

    Central banks around the globe have responded to elevated inflation by hiking interest rates– and bond yields have increased alongside them. The two-year US Treasury bond is currently yielding nearly 4%. That’s still a relatively low return, but better than the S&P 500’s dividend yield of around 1.7%.

    “For the first time in several years, bonds are attractive investment options. In addition to providing diversification versus equities…you now get paid for owning them,” wrote Barry Ritholtz of Ritholtz Wealth Management on Wednesday.

    Consider the alternative: the S&P is down more than 20% year to date.

    The US Bureau of Economic Analysis releases its third estimate for Q2 GDP and US weekly jobless claims.

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  • What is Herschel Walker going to do now? | CNN Politics

    What is Herschel Walker going to do now? | CNN Politics

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    CNN
     — 

    In the space of the last few days, the Georgia Senate race was buffeted by two massive stories.

    First came a Daily Beast report that Walker had paid for a woman’s abortion after the two conceived a child while they were dating in 2009. CNN has not independently verified the allegations and Walker vehemently denied the report, insisting that it was a “defamatory lie.” Walker has been outspoken in his opposition to abortion throughout the campaign.

    The Daily Beast subsequently reported on Wednesday that the anonymous woman who says she had an abortion paid for by Walker is also the mother of one of his children – and that she decided to share this after Walker’s denials of her original allegation. The Daily Beast reported that the woman provided proof that she is the mother of one of his children, but did not say how. CNN has not independently confirmed that detail and Walker has denied the latest report.

    After the initial Daily Beast report, Walker’s son, Christian, a conservative online influencer, posted a series of tweets that said Walker was something short of a model father.

    “I don’t care about someone who has a bad past and takes accountability,” Christian Walker wrote. “But how DARE YOU LIE and act as though you’re some ‘moral, Christian, upright man.”

    Walker responded to his son this way: “I LOVE my son no matter what.” Christian Walker also posted a video on Twitter Tuesday morning in which he said he was done with his father’s “lies.”

    Those twin developments of the initial allegations and his son’s comments create deep uncertainty in the race between Walker and Democratic Sen. Raphael Warnock, which is widely seen as one of the most important (and closest) Senate contests in the country.

    So, what’s next?

    That’s hard to tell – mostly because we live in a post-Donald Trump world.

    Typically in situations like this, the candidate would do some sort of interview, usually with a friendly media outlet. That’s the route Walker took, sitting down for two interviews with Fox News since the story broke.

    The candidate’s campaign now has to do several things at once:

    1) Try to reassure donors and voters that this is all overblown, and that the campaign remains laser-focused on what they need to do to win.

    2) Ensure that there are no other shoes to drop – and that Walker’s total denial on the abortion charge can be made to stick.

    But, as if you needed a reminder, we are not in normal times.

    Just weeks before the 2016 presidential election, an “Access Hollywood” tape emerged that showed Trump speaking in lewd and crude terms about women and bragging about sexual assault. There was talk – publicly and privately – among Republican leaders at the time about him dropping out of the race or entirely disowning his candidacy.

    Neither happened. Trump dismissed the whole incident as “locker room talk” and went on to defeat Hillary Clinton. Which, even in retrospect, is a stunning turn of events.

    The question is whether Trump fundamentally rewrote the rules of political scandals in 2016 or if he is simply the very rare exception to this still-existing rule.

    Walker campaign manager Scott Paradise referenced the “Access Hollywood” episode in a speech to staff after the Walker news broke earlier this week. “Trump still made it to the White House,” Paradise said, a source familiar with the remarks told CNN. (Paradise, via Twitter, denied making that comparison.)

    So far, Republicans are closing ranks around Walker.

    “Herschel Walker is being slandered and maligned by the Fake News Media and, obviously, the Democrats,” Trump said in a statement Tuesday. “They are trying to destroy a man who has true greatness in his future, just as he had athletic greatness in his past.”

    “Full speed ahead in Georgia,” said Steven Law, the president of Senate Leadership Fund, a major GOP super PAC focused on Senate races.

    The Republican support for Walker is, in some ways, forced upon the party. There are now less than five weeks left in the midterm election and dumping him as their candidate at this point – or distancing themselves from him – would almost certainly cost them a seat they badly need for the majority. It’s realpolitik at its finest.

    Of course, if more allegations come to light or if Walker looks so damaged that he can’t win, history suggests that the support he currently enjoys could erode quickly.

    The controversy surrounding Walker functions as a very interesting test case for how scandals will be handled by campaigns and processed by voters in the post-Trump era. Can Walker just keep campaigning as though nothing has changed? Or does he need a full plan to ensure he remains a viable candidate?

    This story has been updated with additional developments.

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