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Tag: iab-personal finance

  • Americans are becoming ‘reluctant’ to make larger purchases, new Fed report shows | CNN Business

    Americans are becoming ‘reluctant’ to make larger purchases, new Fed report shows | CNN Business


    Minneapolis
    CNN
     — 

    As retail sales took a bit of a breather in December, so did the credit cards.

    US consumers’ outstanding credit grew by $11.56 billion to end the year, according to Federal Reserve data released Tuesday. It’s the lowest monthly gain since January 2021 and well below economists’ expectations of $25 billion.

    For much of 2022, consumer debt levels grew at record rates as pandemic-induced pent-up demand ran up against a period of rampant inflation.

    However, as the year drew to a close — and the Federal Reserve jacked up interest rates to combat inflation — that bullish spending activity was curtailed.

    “Long story short, we’re seeing a more cautious consumer,” Ted Rossman, senior industry analyst with Bankrate, told CNN.

    “Consumer spending certainly isn’t falling off a cliff, but we are seeing ample evidence that Americans are becoming more reluctant to make certain purchases, especially larger expenses and acquiring physical goods,” he said. “Services spending has been more robust, perhaps still owing to pent-up demand that stacked up during the pandemic for things like traveling and dining out.”

    Revolving credit balances, which is mostly credit cards, grew by 7.3% in December, according to Tuesday’s report. That’s the lowest month-on-month increase since the summer of 2021, Rossman noted.

    Still, those balances growing in a month when spending was down likely shows the toll taken by higher interest rates, Rossman said.

    The average credit card charges a record-high 19.95%, Rossman said, citing Bankrate data that also showed that 46% of card holders are carrying a balance from month to month. That’s up from 39% a year before.

    “Even if spending may be tailing off a bit, high inflation and higher interest rates are making balances harder to pay off,” he said. “More people are putting necessities on credit cards and financing these expenses over time.”

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  • Fed Chair Powell: Inflation fight will take ‘a significant period of time’ | CNN Business

    Fed Chair Powell: Inflation fight will take ‘a significant period of time’ | CNN Business


    Minneapolis
    CNN
     — 

    The US labor market remains “extraordinarily strong” and Friday’s monster jobs report underscored that the central bank has more work to do to bring down inflation, Federal Reserve Chairman Jerome Powell said Tuesday.

    “We didn’t expect it to be this strong,” Powell said of the January jobs report, which showed the US economy added 517,000 jobs. “It kind of shows you why we think that this will be a process that takes a significant period of time.”

    Powell was speaking during a question-and-answer session with David Rubenstein of the Economic Club of Washington.

    “The disinflationary process has begun,” Powell said, noting progress especially in goods prices. However, price gains within the services sector remain high, he added.

    The Fed expects “significant” declines in inflation to occur this year. It will take “not just this year but next year to get down to 2%,” the central bank’s inflation target, Powell said. And rates will have to remain at a restrictive level “for a period of time” before that happens, he noted.

    Powell expects housing inflation to come down by the middle of this year but is keeping the closest watch on a metric within the Personal Consumption Expenditures report: Core services excluding housing.

    “There has been an expectation that [inflation] will go away quickly and painlessly; I don’t think it’s guaranteed that’s the base case,” Powell said. “It will take some time.”

    The major US stock indexes rallied during Powell’s discussion but then fell in early afternoon trading, with the Dow down by around 200 points or 0.6%, the S&P lower by 0.3% and the tech-heavy Nasdaq down by 0.2%.

    While economists said the January job total was heavily influenced by seasonal factors and will probably be adjusted downward, it was probably too hot for the Fed’s liking. The robustness of the labor market has stood somewhat at odds with the Fed’s efforts to lower inflation.

    “The labor market is strong because the economy is strong,” Powell said.

    The current labor market is also a reflection of the pandemic’s lasting effect on the US economy and labor supply, he noted. The demand exceeds the supply by 5 million people, and the labor force participation rate has declined, he said.

    “It feels almost more structural than cyclical,” he said.

    A key reason Chair Powell wants more slack in the labor market is out of concern that a tight employment situation will continue to push up wages, which could then keep inflation elevated. As the unemployment rate rises, workers lose bargaining power for higher wages and households pull back on spending.

    Fed officials also want to keep inflation expectations anchored.

    “We had a labor market with 3.5% unemployment in 2018 and ’19, and we had inflation just barely getting to 2%, and wages moving up for most of the people at the lower end of the spectrum,” he said. “We all want to get back to that place.”

    And the Fed will react accordingly with the data to ensure it does, he said.

    “If we continue to get, for example, strong labor market reports or higher inflation reports, it may well be the case that we have to do more and raise rates more,” he said.

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  • Gold giant Newmont’s $16.9 billion bid for Australia’s Newcrest clouded by deal doubts | CNN Business

    Gold giant Newmont’s $16.9 billion bid for Australia’s Newcrest clouded by deal doubts | CNN Business


    Melbourne
    Reuters
     — 

    Top gold producer Newmont

    (NEM)
    Corp said it had made a $16.9 billion offer for Australian peer Newcrest

    (NCMGF)
    Mining to build a global gold behemoth, although investors and analysts said it undervalued the target amid a leadership change.

    Newcrest is seeking a new boss, with previous chief executive Sandeep Biswas having stepped down in December, while global interest rates are expected to peak this year and turn down, polishing the outlook for gold prices.

    The Australian gold miner said that it was considering the all-share proposal in a filing that was a response to media speculation over the weekend. The initial feedback from shareholders is that they want a higher price, according to a person familiar with Newcrest’s deliberations.

    “A good litmus test for a reasonably-priced deal is one where both seller and buyer feel somewhat aggrieved by selling out too low or by paying too much,” said Simon Mawhinney, chief investment officer at Allan Gray, Newcrest’s largest shareholder with a 7.36% stake. “It’s not clear to me that this kind of symmetry exists with these deal terms.”

    Newcrest shares surged as much as 14.4% to A$25.60 ($17.77), the highest since May 2022, but remained below the implied current offer price of $27.16, suggesting investors were not convinced the deal would pan out. Shares closed 9.3% higher at A$24.53.

    Newmont, which is already the world’s biggest gold producer by market capitalization and by ounces produced, said the combination represented “a powerful value proposition.”

    Newcrest’s operations include its top class Cadia asset in Australia, an expanding footprint in North America and Papua New Guinea, and growth potential in copper, highly prized as key to the energy transition. BHP

    (BBL)
    Group offered $6.4 billion for Australian copper miner Oz

    (OZMLF)
    Minerals Minerals in December.

    The Newmont proposal is via an agreed scheme of arrangement that would need to be recommended by the Newcrest board and subject to due diligence, various regulatory approvals and a shareholder vote that could stretch out for months.

    The indicative offer implies a 21% premium to Newcrest’s last closing value of A$22.45, materially below the traditional 30% takeover premium, noted analyst Jon Mills of Morningstar, which values Newcrest at about A$31 per share.

    Newcrest shareholders would receive 0.380 Newmont shares for every Newcrest share, giving them a 30% stake in the enlarged miner. It is a 4.7% improvement from a previous 0.363 per share offer that Newcrest already rejected for not providing enough value to shareholders, Newcrest disclosed on Monday.

    If investors don’t back the deal, the board will be under pressure to improve Newcrest’s value, perhaps by breaking out assets like Havieron and Telfer in Australia, or Lihir in Papua New Guinea, said Barrenjoey analyst Dan Morgan.

    Newcrest has been expected to announce a new chief executive this year after Biswas announced his retirement after eight years.

    Sherry Duhe, formerly chief financial officer, who joined Newcrest in February last year, is interim chief executive while a global internal and external search for a replacement is underway.

    Newcrest has been viewed as a target in recent years given its middling performance, but only a handful of buyers are big enough to take it out, said an investment banker who was not authorized to speak publicly about the matter.

    The all-share nature of the offer meant the timing is more likely to be linked to Newcrest’s leadership vulnerability than a big call on the gold price, but it probably also reflects a constructive view on the precious metal, the banker added.

    Risks are growing for gold to break higher, Morgan Stanley in a note on Jan. 16, noting that its macroeconomists were now forecasting lower rates and a weaker U.S. dollar, in tailwinds for the metal.

    Morgan Stanley is looking towards a bull case of spot gold reaching $2,160 in the fourth quarter, up from $1,866 an ounce.

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  • Inflation may be falling — but not the cost of your car insurance | CNN Business

    Inflation may be falling — but not the cost of your car insurance | CNN Business



    CNN
     — 

    If you think news that inflation is easing means you’re not going to get hit with any more higher prices, think again.

    At least, that is, if you’re paying for car insurance. There’s a very good chance your premiums this year will go up … by a lot.

    The average cost of full coverage auto insurance has hit $2,014 a year nationally, up nearly 14% from last year, according to Bankrate’s annual True Cost of Auto Insurance Report, released Monday.

    Why? It’s a lagging effect of high inflation from the last two years that resulted from labor and parts shortages, which in turn drove up the cost of paying insurance claims on car repairs and related insured expenses.

    “Car insurance rates are reactionary,” said Cate Deventer, Bankrate’s insurance analyst.

    But the good news, she added, is this: “If inflation keeps cooling we could see insurers file for rate decreases in future years.”

    Plenty of other factors may increase your individual premium.

    For instance, putting your teen child as a driver on your policy will jack up the rate.

    Ditto if you got into an accident, had speeding tickets or were convicted of a DUI.

    Expect to pay more, too, if your credit score fell or you let your auto coverage temporarily lapse.

    Another big factor in how much your premiums will cost is where you live.

    “Each geographic area has different risks and costs of living, [so] the cost for car insurance varies across the nation,” Deventer said.

    Among major metro areas, Bankrate found that average 2023 premiums rose the most in Orlando, Florida (up nearly 23% to $3,078), followed by Phoenix (up nearly 17% to $2,164). They fell the most in Philadelphia (down nearly 22% to $1,872) and New York City (down 14% to $2,649).

    Meanwhile, as a percentage of average household income, drivers living in Miami now pay the most — 5.51%, or $3,447. Drivers in Boston, meanwhile, pay the least -— just 1.32% of average income, or $1,328.

    While you can’t control the effects of inflation or location on your premium, there are other things you can do to keep your costs to a minimum, Deventer said.

    Look for discounts: Every auto insurer provides them and there are many kinds.

    For instance, you may score a discount if you take a defensive driving course.

    Or if the teenager on your policy goes away to boarding school or college and can’t drive your car, your insurer may offer a “student away” discount. And if they aren’t away, but attend school full-time and get good grades through age 24, that may save you a few bucks, too, Deventer said.

    In any case, if your insurer doesn’t provide you a full list of options, ask to see what’s available to you.

    Shop around: If you’re unhappy with your premium, see if another insurer will give you a better deal, especially if you have a great driving record. “Every company uses a different algorithm to determine rates,” Deventer said.

    (The full Bankrate study can be found here.)

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  • EV maker Rivian to cut 6% of jobs amid price war | CNN Business

    EV maker Rivian to cut 6% of jobs amid price war | CNN Business



    Reuters
     — 

    Rivian Automotive is laying off 6% of its workforce in an effort to cut costs as the EV maker, already grappling with falling cash reserves and a weak economy, braces for an industry-wide price war.

    The company is focusing resources on ramping up vehicle production and reaching profitability, Chief Executive R.J. Scaringe said in an email to employees on Wednesday announcing the job cuts. Reuters obtained a copy of the email.

    Layoffs at Rivian come amid falling EV prices kicked off by cuts made recently by Elon Musk-led Tesla

    (TSLA)
    and Ford Motor Co.

    The price cuts by Tesla and Ford are expected to hurt EV upstarts such as Rivian, Lucid Group and British startup Arrival, which Monday said it would lay off half its staff.

    Despite a blockbuster initial public offering in November 2021, Rivian’s shares have fallen nearly 90% from their peak that month to Tuesday’s close. Rivian’s stock was trading down 4% on Nasdaq on Wednesday, paring some losses after news of the job cuts.

    “We must focus our resources on ramp and our path to profitability,” Scaringe said in the email, in which he apologized to employees for the necessity of the cuts.

    A Rivian spokesman confirmed the email was sent, but declined further comment.

    “They’re bleeding cash and would like to grow at a much faster rate, but they continue to struggle with their EV production ramp and have been unable to meaningfully drive down unit costs,” CFRA Research analyst Garrett Nelson said. “We think that is what’s behind this decision.”

    Rivian is focusing on ramping up production of its R1 trucks and EDV delivery vans for top shareholder Amazon.com and launching its R2 platform, he said. “The changes we are announcing today reflect this focused roadmap.”

    Irvine, California-based Rivian, which has about 14,000 employees, will let go of about 840 staff in a move that will not affect manufacturing operations at its plant in Normal, Illinois.

    Rivian, which has been losing money on every vehicle it builds, narrowly missed its full-year production target of 25,000 vehicles last year as it dealt with supply-chain disruptions caused by the COVID-19 pandemic. It had previously halved that target.

    To further conserve its cash, Rivian late last year shelved plans to build delivery vans in Europe with Mercedes. Rivian had earlier pushed back by a year to 2026 the planned launch of a smaller R2 vehicle family at the $5 billion plant it is building in Georgia.

    Last July, Rivian, which is scheduled to report fourth-quarter results on Feb. 28, laid off staff and suspended some programs as part of a broader restructuring.

    The company has a market valuation of $17.8 billion. Its cash and cash equivalents stood at $13.27 billion as of Sept. 30, 2022, down from over $18 billion a year earlier.

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  • A vulnerable power grid is in the crosshairs of domestic extremist groups | CNN

    A vulnerable power grid is in the crosshairs of domestic extremist groups | CNN



    CNN
     — 

    Gunshots fired at two power substations in Moore County, North Carolina, late last year left 45,000 homes and businesses without power and more attacks just like that could already be planned by domestic extremist groups, according to experts.

    “All of a sudden, about 8:45 p.m., about 20 shots fired off right across the street,” Spencer Matthews told CNN affiliate WRAL shortly after the December attack.

    The gunfire hit critical parts of the substations and the power went out.

    “Got no way to heat because we don’t have a fireplace,” one woman told WRAL after her home was plunged into darkness.

    Investigators found nearly two dozen shell casings from a high-powered rifle near the substations, but so far have not found a gun or made any arrests.

    Experts say the two substation attacks could be the work of domestic extremists who have openly advocated targeting a vulnerable power system.

    The motive behind the December 3 attack is still not known, but it came after an FBI bulletin in November warned of threats by extremist groups to “create civil disorder and inspire further violence.”

    “This typically very primitive style attack equals millions of dollars in damage,” Brian Harrell, a former US Department of Homeland Security Assistant Secretary for Infrastructure Protection, told CNN. “If you were to shoot out some very key components you can quickly create an effect where this large multimillion dollar transformer becomes essentially a paperweight.”

    In 2022 there were 25 “actual physical attacks” reported on power facilities across the US and one report of “sabotage,” according to the latest statistics available from the Department of Energy.

    The data also shows 57 reports of suspicious activity, and 80 acts of vandalism.

    The numbers are mostly trending up, compared with 2021, when there were six actual physical attacks reported and two reports of sabotage. The data also shows 32 reports of suspicious activity, and 52 acts of vandalism.

    Many attacks remain unsolved.

    “There’s no doubt in my mind that 2023… is probably going to be the most catastrophic when it comes to the uptick of DVE (Domestic Violent Extremist) attacks on electricity infrastructure,” Harrell said. “A number of individuals and extremist groups online right now have already signaled that this is a part of their playbook.”

    One of those playbooks, with a swastika and lightning bolts on the cover, published on a social media platform by a neo-Nazi group, makes their aim quite clear.

    “The main thing that keeps the anti-White system going is the powergrid,” the document reads. “This is something that is easier than you think. Peppered all over the country are power distribution substations… Sitting ducks, worthy prey.”

    It’s part of a White-power philosophy called “accelerationism,” which wants to destroy society and replace it with one based on their racist ideologies.

    “With the power off, when the lights don’t come back on… all hell will break lose, [sic] making conditions desirable for our race to once again take back what is ours,” they write.

    The head of another accelerationist group posted on social media that these attackers have “cracked the code on lone wolf attacks.”

    The attacks “check off all the necessary boxes which I didn’t think possible for lone wolf ops in USA – Frequency, sustainability, geographic concentration,” he is quoted as saying. “Law enforcement appears powerless (no pun intended) to stop them.”

    These groups dream of striking exactly the right spots in the power grid, which government reports have warned for decades could cause a domino effect and leave huge parts of the country in the dark.

    “If you were to target, you know, eight or nine very key nodes throughout the United States, you potentially could have a collapsing effect,” Harrell warns.

    High voltage transmission power lines and substations are often spread across the country in out of the way places which can be hard to keep safe and technically challenging to secure.

    “It’s inherently very difficult to harden or protect it all,” Granger Morgan, an engineering professor at Carnegie Mellon University told CNN. “It may not take all that high tech an approach to cause physical disruption that could have very large consequences.”

    Morgan is the chair of the National Academy of Science’s committee on enhancing the resilience of the nation’s power system.

    “Physical attacks on major system components could cause serious physical damage, especially to large transformers and other hard to replace substation and transmission equipment such as high voltage circuit breakers,” one of his papers from 2017 warned. “Recovery could easily require many days or weeks.”

    Right now there is no central authority that regulates the entire power system, which, Morgan says, gets in the way of changes needed to make the system more robust and resilient from attack.

    Justice Department forms new domestic terrorism unit

    “No one at the moment has authority to deal with the entire system, and we need to get that situation fixed,” he said. “We’ve got the federal regulators overseeing the high voltage system that brings power across long distances. We’ve got state public utility commissions dealing with things at the state level, we got both private and public power.”

    Morgan said a presidential commission or other powerful political body needs to be appointed to take the lead in protecting the grid and making it more resilient to attacks.

    “We just need to get much more systematic in terms of figuring out both how we protect against it, but also how we can quickly put the system back together again, once a problem arises,” he said.

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  • Apple is the only US tech giant to have avoided significant layoffs. Will it last? | CNN Business

    Apple is the only US tech giant to have avoided significant layoffs. Will it last? | CNN Business



    CNN
     — 

    In less than three months, four of the big five US tech companies have cut tens of thousands of employees combined, shattering myths about the industry’s seemingly unstoppable growth in the process.

    But there has been one notable exception: Apple.

    To date, Apple

    (AAPL)
    has not announced any substantial cuts, thanks in part to slower headcount growth than some of its peers during the pandemic and continued demand for its core products. Some analysts think more modest cost cuts could be coming, however.

    The iPhone maker is set to report earnings results for the final three months of 2022 on Thursday after the bell. It is expected to post a rare year-over-year decline in revenue.

    While these expectations show the strain Apple’s business is under, Wedbush Securities’ Dan Ives said in a note this week that pent-up demand for upgrading iPhones remains strong. “Apple will likely cut some costs around the edges, but we do not expect mass layoffs from Cupertino this week,” Ives wrote.

    Tom Forte, a senior research analyst at DA Davison, agreed there will be staff reductions, but likely not as drastic as those at other large tech companies. “Apple will cut headcount,” he said in a recent interview on Bloomberg TV, but suggested the cuts would come through attrition or reductions at the retail level.

    “While they haven’t done so yet, like everyone else, they will adjust their headcount for the current level of demand,” he said.

    Fueled by a surge in demand for digital products earlier in the pandemic, Big Tech went on a massive hiring spree.

    Amazon

    (AMZN)
    and Meta each doubled their headcount between the third quarter in 2019 and the third quarter 2022, according to data shared in the companies’ securities filings. Alphabet, meanwhile, grew its headcount 64% during that time, and Microsoft grew its staff by more than 50% over approximately the same period.

    Apple, by comparison, grew its headcount by a more modest 20%. As of September 2022, Apple said it had approximately 164,000 full-time employees.

    Many tech CEOs, with varying degrees of remorse, have blamed over-hiring in the early days of the pandemic for the mass layoffs now. As pandemic restrictions eased last year, the demand for digital services shifted back toward pre-pandemic levels. Inflation pinched consumer and business spending, and rising interest rates evaporated the easy money tech companies had tapped into. And one-by-one, amid the whiplash, household names in Silicon Valley began announcing widespread layoffs to adjust to the new environment.

    While Apple has not announced layoffs, its business has been strained in other ways. Like other Big Tech companies, it has faced threats of antitrust action in the United States and EU. Earlier this month, Apple also said CEO Tim Cook had agreed to a massive pay cut this year, following a shareholder vote on his compensation package after its stock fell about 27% in 2022.

    As consumer spending tightened, global smartphone shipments plunged 18% in the fourth quarter of 2022, according to market research firm Canalys. Apple’s business also faced supply chain hurdles linked to China’s Covid lockdowns and unrest that hit a key production site in Zhengzhou, China late last year.

    Still, Apple’s business is weathering the downturn better than some of its fellow tech giants. In its most-recent earnings report, the company reported sales grew 8% year-over-year and that the company hit a September quarter revenue record for iPhone.

    Thursday’s earnings results will show whether Apple can keep defying gravity.

    “Apple continues to innovate with high-quality, industry-leading products supported by a powerful digital platform,” analysts at Monness, Crespi and Hardt wrote in an investor note Tuesday. “However, regulatory headwinds persist and we believe the darkest days of this downturn are ahead of us.”

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  • Alex Murdaugh hid settlement of more than $4 million from family of his late housekeeper, her son testifies | CNN

    Alex Murdaugh hid settlement of more than $4 million from family of his late housekeeper, her son testifies | CNN



    CNN
     — 

    Disgraced South Carolina attorney Alex Murdaugh never told the family of his late housekeeper that he collected more than $4 million in insurance settlements after she fell at his home, according to testimony at his double murder trial Friday.

    Outside the presence of the jury, Judge Clifton Newman heard testimony about Murdaugh’s alleged financial schemes as the court weighs whether to allow the admission of such evidence.

    Prosecutors want the evidence of financial wrongdoing admitted to show that the scion of one of the state’s most powerful families was, in their words, a desperate thief on the verge of being exposed at the time of the 2021 murders of his wife and adult son.

    Defense attorneys have portrayed the defendant as a loving father and husband being prosecuted after a poorly handled investigation while the real killers remain at large.

    Michael Satterfield, a son of Gloria Satterfield, who worked as housekeeper for the Murdaugh family for more than 20 years, testified in the second week of the murder trial. She died a few weeks after a fall at the Murdaugh home in 2018.

    Satterfield’s son told the court that Murdaugh offered to “go after my insurance company” to help their family with medical bills and other expenses.

    Michael Satterfield testified that Murdaugh at one point said Satterfield and his brother could each get $100,000 from the insurance company. They never got the money, he testified. And Murdaugh never mentioned a $5 million umbrella policy that he had in addition to a policy for a smaller amount.

    In June 2021, Michael Satterfield testified, his family heard their case was settled but Murdaugh did not disclose that he had collected on two settlements – one for more than $500,000 and another for $3.8 million.

    “Did he get your permission to steal your money?” Waters asked.

    “No.”

    “Did you ever get one cent from Alex Murdaugh?” Waters asked later.

    “No.”

    In December 2021, an attorney for the Satterfield family said Murdaugh agreed to a $4.3 million settlement with the family. He also issued an apology to the Satterfields.

    The first witness called Friday, also outside the jury’s presence, was Jan Malinowski, president and CEO of Palmetto State Bank. Palmetto’s former president, Russell Laffitte, was convicted of six counts of financial fraud crimes in November.

    Malinowski, who testified at Laffitte’s trial, told the court that Murdaugh’s mounting debt to the bank was regularly covered, without justification, by loans from Laffite.

    In August 2021, two months after the murders, Murdaugh’s account had an overdraft of more than $350,000, Malinowski testified. Laffitte responded with a $400,000 transfer to the defendant’s account.

    Murdaugh at the time owed the bank more than $4 million, Malinowski testified.

    Would the loans have kept coming had the bank known “that Murdaugh had been stealing money from his partners or … his clients?” asked Creighton Waters, a prosecutor with the South Carolina Attorney General’s Office – which is prosecuting the case because of the Murdaugh family’s long ties with the local solicitor’s office.

    “No sir,” the CEO replied.

    Waters, eliciting laughter in the courtroom, said the bank had “perhaps the most generous overdraft policy ever seen.”

    “Quite possibly,” Malinowski replied with a slight smile.

    Prosecutors, in pretrial filings, accuse Murdaugh of killing his wife, Margaret “Maggie” Murdaugh, and his 22-year-old son Paul Murdaugh to distract attention from alleged financial crimes, which the state contends were about to come to light when they were killed on June 7, 2021.

    In addition to the murder counts, he faces 99 charges related to those purported schemes.

    A pretrial motion from the state contended “the murders served as Murdaugh’s means to shift the focus away from himself and buy some additional time to try and prevent his financial crimes from being uncovered, which, if revealed, would have resulted in personal legal and financial ruin for Murdaugh.”

    The defense has fought the admissibility of the evidence in the murder case, asserting the fraud cases are irrelevant to the question of Murdaugh’s guilt in the murders of his wife and son.

    Murdaugh, who was disbarred amid a mountain of allegations of white-collar theft and fraud, faces 99 charges stemming from 19 grand jury indictments, including allegedly defrauding his clients and former law firm of nearly $9 million, according to the attorney general’s office.

    Under each case, Murdaugh faces the possibility of two sentences of life in prison without the possibility of parole if convicted.

    On Thursday, the chief financial officer of Murdaugh’s former law firm testified about confronting the now-disbarred attorney about missing funds the morning his wife and son were killed.

    Jeanne Seckinger, CFO of the firm formerly known as PMPED, testified outside the jury’s presence.

    The morning of the murders, Seckinger confronted Murdaugh about $792,000 in missing funds, she said Thursday, testifying that legal fees should have been made payable to the law firm – renamed to Parker Law Group after Murdaugh’s ouster – and not to individual attorneys.

    But Seckinger and other members of the firm realized in May 2021 they had not received a fee check stemming from a settlement signed in a case Murdaugh shared with another attorney, Seckinger testified, which was a concern.

    At the time, Murdaugh was facing a lawsuit from the family of 19-year-old Mallory Beach, who was killed in February 2019 when a boat, owned by Murdaugh and allegedly driven by Paul, struck a bridge piling.

    Murdaugh’s financial records – which state court filings said “would expose (Murdaugh) for his years of alleged misdeeds” – could have been disclosed following a hearing in the civil case scheduled for June 10, 2021, three days after the killings.

    But the June 10 hearing was canceled after Maggie and Paul’s deaths, Seckinger said Thursday, and the firm opted not to confront Murdaugh about the missing money.

    Eventually, the firm did confront Murdaugh about the missing money and “it was my understanding that Alex admitted it,” Seckinger testified.

    Before the firm could announce Murdaugh’s resignation, however, Seckinger testified she heard Murdaugh had been shot while on the side of the road. Murdaugh later told authorities he conspired with a former client to kill him as part of an insurance fraud scheme, purportedly so his surviving son could collect a $10 million life insurance payout.

    Finally, the court on Friday heard from a ballistics expert who told the court the .300 Blackout rifle cartridge casings found near Maggie’s body had identical markings to older casings found near the Murdaugh home as well as at a shooting range on their property.

    The older casings found near the house and in the shooting range “had those same matching mechanism marks to conclude they’d been loaded into, extracted and ejected from the same firearm as those at the crime scene around Margaret Murdaugh’s body,” Paul Greer, a firearm examiner with the South Carolina Law Enforcement Division, testified.

    The prosecution has said Maggie was killed with a .300 Blackout AR-15 rifle that was a “family weapon” but the weapon has yet to be found.

    During cross-examination by the defense on Friday, Greer said it is “hard to say” whether different .300 Blackout rifles could create the same markings on casings – but reaffirmed he was confident in his findings.

    Greer test fired one .300 Blackout rifle found in the gun room on the Murdaugh property and said the results were inconclusive on whether its ejected casings were an exact match with the casings found around Maggie’s body – but he said if the casings were not from that exact weapon, they came from one identical to it.

    Prosecutors have also said the Murdaughs owned other AR-style rifles, including one Murdaugh bought his son to replace another that went missing. The prosecution has said the replacement is “nowhere to be found.”

    Greer had similar testimony when the defense asked if Paul was killed with the camouflage-patterned gun Alex Murdaugh had on him when first responders arrived at the crime scene. The expert said he test fired that gun and the results were inconclusive. Greer testified he could not tell whether the casings were a match, but that it was possible the gun – or a weapon with similar characteristics – killed Paul.

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  • Snap stock plunges 15% as revenue growth stalls | CNN Business

    Snap stock plunges 15% as revenue growth stalls | CNN Business


    New York
    CNN
     — 

    Snapchat’s parent company reported stalled revenue growth and a large net loss for the final three months of 2022, as it confronts tighter advertiser budgets amid broader economic uncertainty.

    Snap’s quarterly revenue was just shy of $1.3 billion, essentially flat from the year prior. For the full year, Snap’s revenue grew 12%, a slower rate that the company attributed to “rapid deceleration in digital advertising growth.”

    The situation appears to be even worse in the current quarter. Snap said it has already seen a roughly 7% revenue decline so far in the first quarter compared to the year prior. It estimates revenue for the first three months of the year will be down between 2% and 10% compared to the previous year. (Those figures were included in an investor letter, despite Snap saying it would not provide specific guidance for the quarter.)

    Meanwhile, Snap posted a net loss of more than $288 million in the quarter, compared to the $22.5 million in net income it earned in the same period a year ago.

    Snap

    (SNAP)
    shares fell as much as 15% in after-hours trading following the report.

    The report marked the fourth straight quarter of net losses for Snap, which has suffered from increased competition in the social media market, disruptions to its ad business from Apple’s app privacy changes and weaker advertiser demand amid fears of a looming recession. High interest rates and inflation have also impacted many large tech firms.

    Snap’s earnings could be a concerning bellwether for the other tech giants that rely on the health of the digital ad market, including Facebook-parent Meta and Google-parent Alphabet, both of which are set to report results this week.

    Shares of Meta and Alphabet dipped slightly in after-hours trading Tuesday following Snap’s results.

    Snap in August became one of the first big tech firms to announce major layoffs when it said it would cut 20% of its staff. A slew of other tech companies have followed suit in recent months, including Meta, Alphabet, Amazon, Mircrosoft and others, resulting in tens of thousands of job losses in the industry.

    In addition to challenges in the digital advertising market, Snap pointed to a change to its ad platform that it expects “will drive improvement for our partners and our business over time, but that may be disruptive… in the near term.”

    Perhaps the lone bright spot for Snap in the results is its audience. The company reported having 375 million daily active users in the quarter, an increase of 17%. Snap’s subscription service Snapchat+, which launched last year in an attempt to grow new revenue sources, reached more than 2 million paying subscribers in the fourth quarter, it said.

    The company also said it expects to realize the $500 million in cost reductions it had promised as a result of its restructuring by the end of the first quarter.

    Still, Scott Kessler, an analyst for investment firm Third Bridge, said in an investor note following the report that, “one of the big questions about Snap is whether it remains a growth story or can soon continue as a growth story,” given its gloomy outlook for the start of this year.

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  • Gautam Adani fails to calm investors over market mayhem that wiped out billions | CNN Business

    Gautam Adani fails to calm investors over market mayhem that wiped out billions | CNN Business


    New Delhi
    CNN
     — 

    Indian billionaire Gautam Adani tried to reassure investors on Thursday after he abruptly abandoned his flagship firm’s $2.5 billion share sale.

    “For me, the interest of my investors is paramount and everything is secondary,” the 60-year-old businessman said in a recorded video address. “Once the market stabilizes, we will review our capital market strategy.”

    This was the first time the tycoon has spoken about the stock market mayhem that has wiped billions off his logistics and energy business empire.

    A week-long meltdown in the value of Adani Group shares started when an American short seller accused the conglomerate of fraud. The group, which has seven listed companies, has lost more than $90 billion in market value in the week since Hindenburg Research published its report.

    Foreign banks have started to closely scrutinize the conglomerate. According to Bloomberg, Credit Suisse has stopped accepting bonds of Adani firms as collateral for margin loans to its private banking clients. The Swiss lender declined to comment on a CNN request for confirmation.

    Despite the turmoil, the group’s flagship company, Adani Enterprises, managed to issue new shares worth $2.5 billion on Tuesday. The capital raising exercise was touted as India’s biggest ever public offering by a listed company. After a tepid start, the offer was fully subscribed.

    A day later, though, Adani abandoned the deal. The shares have been trading considerably below the offer price since last week, meaning that investors in the capital raise were looking at immediate losses.

    “Hence to insulate the investors from potential losses we have withdrawn,” Adani said in the video. “This decision will not have any impact on our existing operations and future plans. We will continue to focus on timely execution and delivery of projects.”

    Adani added that his group’s fundamentals were “strong” and that it had an “impeccable track record of fulfilling our debt obligations.”

    In an investigation published on January 24, Hindenburg Research accused the Adani Group of “brazen stock manipulation and accounting fraud scheme over the course of decades.”

    The research firm also questioned the “sky-high valuations” of Adani firms and said their “substantial debt” put the entire group “on a precarious financial footing.”

    While the Adani Group had immediately denounced the report as “baseless” and “malicious,” the video address marked the first time the founder spoke about the crisis.

    But it wasn’t enough calm the markets. Shares in Adani Enterprises were down almost 9% in Mumbai, while shares in his other companies plunged 5% to 10%.

    Indian market regulators have not yet commented on the events of the past week. But, Reuters reported Wednesday that the Securities and Exchange Board of India (SEBI) was examining the stock price falls and also looking into any possible irregularities in Tuesday’s share sale, citing a source with direct knowledge of the matter.

    The scrapping of the share sale on Wednesday was a huge setback for one of India’s most prominent industrialists. Just a week ago, Adani’s sprawling group was worth over $200 billion, making him Asia’s richest man by a wide margin. At one point last year, he even overtook Jeff Bezos to become the second richest person in the world.

    On Wednesday, Adani lost his perch as Asia’s richest man, according to the Bloomberg Billionaire’s Index. He had a net worth of $72.1 billion, according to the index, behind Mukesh Ambani, who has a fortune of $81 billion.

    CNN’s Mark Thompson contributed to this report.

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  • The deadly ice storm crippling much of the South leaves more than 300,000 Texans without power in the frigid cold | CNN

    The deadly ice storm crippling much of the South leaves more than 300,000 Texans without power in the frigid cold | CNN



    CNN
     — 

    Treacherous road conditions are now linked to three deaths in Texas as a wave of ice and sleet continues to hammer parts of the southern and central US into the overnight hours.

    A 49-year-old woman was killed this week when she lost control of her truck on an icy road north of Eldorado, the Texas Department of Public Safety told CNN on Wednesday.

    Two other deaths were previously linked to the storm that coated Texas cities with sleet or ice. In south Austin, one person died Tuesday morning in a 10-car pileup, the city’s fire department said. Another person died when their car rolled over in the Dallas-area city of Arlington, police said.

    The dangerous conditions are not over. A nasty combination of freezing rain, sleet and accumulating ice are expected hit parts of Texas, Arkansas and Tennessee through at least Thursday morning, forecasters said.

    “Road conditions will be AWFUL after sunset and overnight,” the National Weather Service in Fort Worth said. “DO NOT BE ON THE ROADS.”

    More than an inch of sleet has already piled up in parts of Texas, Oklahoma, Arkansas, Missouri, Kentucky and Illinois since Monday.

    In Texas alone, more than 350,000 homes, businesses and other power customers had no electricity in the frigid cold Wednesday night, according to PowerOutage.US.

    Ice brought down multiple trees and large tree limbs Wednesday, causing power outages across the Austin metro area, the National Weather Service said.

    Dangerous conditions prompted Parkland Health system in Dallas to extend the closure of its clinics on Thursday.

    Here’s what’s on tap in the southern and central US:

    • Texas: The state has seen heavy freezing rain throughout Wednesday, which will continue steadily into overnight across much of northern and central Texas as temperatures remain below freezing.

    • Southern Oklahoma: Freezing rain continues to move across the region and will last through Thursday morning.

    • South-central Arkansas and Tennessee’s Memphis area: An additional tenth- to quarter-inch of ice could pile up through Thursday morning.

    • Across the region: Total ice accumulation of at least a quarter of an inch is likely from West Texas to western Tennessee through Thursday morning. Up to a half-inch could build up in parts of central and north-central Texas and southern Arkansas, the National Weather Service said.

    • Widespread flight cancellations: More than 2,400 flights within, into or out of the US were canceled Wednesday, according to the tracking website FlightAware.

    Jackknifed tractor-trailers blocked Interstate 10 in Reeves County, Texas, on Tuesday.

    In a state not accustomed to heavy ice, a group of Jeep enthusiasts used their vehicles to help stranded drivers.

    The Dallas-based “Carnales Off Road” group regularly supports those in need, founder Jorge Coronilla Muñiz told CNN.

    “It’s not the first time we’ve done this during bad weather. We try to help as often as possible,” Muñiz said.

    Several semi-trucks got stuck on Interstate 20 on Tuesday, and about 30 Jeeps helped tow them.

    “Before we got to I-20, we also helped a few other cars who were stuck on the streets,” Muniz said. “We eventually came across the standstill on Interstate 20 and helped an additional 20 trucks.”

    Muñiz said he and other group members helped stranded motorists from early Tuesday morning all the way until 10 p.m.

    “Everyone was very grateful for our help, especially the truck drivers. Some even asked if we were going to charge them for the help, but we told them we were just there to help.”

    The group is back out on the roads Wednesday and will help medical professionals having difficulty getting to and from work, Muñiz said.

    More than 12 million people across parts of southeastern Oklahoma, southern Missouri, central and eastern Arkansas, western Tennessee, northwestern Mississippi and Texas are under ice storm warnings Wednesday.

    The weather service issues ice storm warnings when ice accumulations of more than a quarter of an inch are possible.

    Unsafe travel conditions Tuesday led to hundreds of car crashes across Texas, officials said. Emergency workers responded to people suffering from hypothermia or those injured after slipping on ice. The Texas National Guard is prepared to help stranded motorists, clear roadways and provide welfare checks, Gov. Greg Abbott said. And Texas Parks and Wildlife has at least 30 responders ready for search and rescue operations.

    Meanwhile, a separate storm system will also send temperatures plunging across the Northeast.

    The National Weather Service predicts “dangerously cold temperatures” in the region Friday and Saturday, with freezing cold wind chills that can cause frostbite in just 10 minutes, it said.

    “Limit time outdoors and cover all skin if going out,” the service added.

    The service forecasts wind chills of -20 to -35 degrees Fahrenheit early Friday affecting parts of New York, Vermont, New Hampshire and Maine, while Saturday morning could bring wind chills of -60 degrees Fahrenheit across northern New England, the weather service said.

    Leaders across states including Rhode Island, Connecticut and Maine were coordinating resources ahead of the extreme weather and setting up warming centers, according to messages from the governors.

    “Temperatures this weekend will be extremely – and dangerously – cold across the state,” Maine Gov. Janet Mills said in a Tuesday news release. “Please take extra precautions, be careful if you go outside, and be sure to check on your family, friends, and neighbors to make sure they are okay.”

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  • Biden proposes ‘junk fee’ bill to cut hidden fees for credit cards and concert tickets | CNN Business

    Biden proposes ‘junk fee’ bill to cut hidden fees for credit cards and concert tickets | CNN Business



    CNN
     — 

    President Joe Biden announced new progress Wednesday on his administration’s “competition agenda,” specifically taking aim at junk fees while calling on Congress to pass legislation targeting hidden fees across multiple industries.

    These costs can “drain hundreds of dollars a year from the pockets of hardworking American families, especially folks who are already struggling to make ends meet — but not anymore after today,” Biden said at the fourth meeting of the Presidential Competition Council on Wednesday.

    The proposed legislation in partnership with the Consumer Financial Protection Bureau, called the Junk Fee Protection Act, would target four types of excessive fees:

    • excessive online concert, sporting event and entertainment ticket fees
    • airline fees for families sitting together on flights
    • exorbitant early termination fees for TV, phone and internet services
    • surprise resort and destination fees

    In brief remarks before the meeting, Biden had called out credit card late fees in particular as “a junk fee if there ever was one,” saying the new guidance from the CFPB would reduce these fees.

    “Today’s rule proposes to cut those fees from $31 on average to $8,” he added. “That change is expected to save tens of millions of dollars for Americans, roughly $9 billion a year in total savings.”

    Biden called on Congress to pass the junk fee legislation, saying it would give “hardworking Americans just a little bit more breathing room.” It’s part of a plan, he added, to build “an economy that’s competitive and an economy that works for everyone.”

    Rohit Chopra, director of the CFPB, noted before the announcement that “over a decade ago, Congress banned excessive credit card late fees.”

    “But companies have exploited a regulatory loophole that has allowed them to escape scrutiny for charging an otherwise illegal junk fee,” he added in a statement to CNN. “Today’s proposed rule seeks to save families billions of dollars and ensure the credit card market is fair and competitive.”

    Another fee category that frustrates many customers is event tickets sold online, for which additional fees are frequently high — and typically appear late in the checkout process when a customer is about to make the purchase.

    For example, earlier this year, lawmakers grilled Live Nation president and CFO Joe Berchtold following a ticket sales debacle over exorbitant ticketing fees. Although the company said Wednesday it supports reform, it also said it opposes the proposed legislation.

    “We stand ready to work with the President and Congress on many common sense ticketing reforms, while also speaking out against proposed legislation that would benefit scalpers over artists and fans,” the company said in a statement.

    Biden’s Transportation Department also took steps last fall during the previous meeting of the Competition Council to reduce “unnecessary hidden fees,” from airline and travel sites that the the President warned were “weighing down family budgets.”

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  • The bizarre history of Groundhog Day — or, how we decided to trust a subterranean rodent | CNN

    The bizarre history of Groundhog Day — or, how we decided to trust a subterranean rodent | CNN



    CNN
     — 

    Every year, Americans in snowy states wait with bated breath to see whether Punxsutawney Phil will spot his shadow. And every year, we take Phil’s weather forecast – six more weeks of winter, or an early spring? – as gospel, meteorology be damned.

    It’s about as strange (and cute) as holidays get. So how did Groundhog Day go from a kooky local tradition to an annual celebration even those of us who don’t worry about winter can find the fun in?

    We explore Groundhog Day’s origins from a tiny event to an American holiday we can all be proud of. Spoiler: there are badgers, immortality and at least one groundhog on the menu.

    Every February 2, the members of the Punxsutawney Groundhog Club trek to Gobbler’s Knob, Punxsutawney Phil’s official home just outside of town. Donning top hats and tuxedos, the group waits for Phil to leave his burrow, and if he sees his shadow, the town gets six more weeks of winter. If he doesn’t see his shadow, Punxsutawney gets an early spring.

    But the early seeds of the Groundhog Day we know today were planted thousands of years ago, according to Dan Yoder, a folklorist “born and raised in the Groundhog Country of Central Pennsylvania” who penned the definitive history of the folk holiday turned national tradition.

    The holiday evolved over centuries as it was observed by different groups, from the Celts to Germans to the Pennsylvania Dutch and eventually, by those in other parts of the US. Its evolution began in the pre-Christian era of Western Europe, when the Celtic world was the predominant cultural force in the region. In the Celtic year, instead of solstices, there were four dates – similar to the dates we use today to demarcate the seasons – that were the “turning points” of the year. One of them, per Yoder, was February 1.

    These turning point dates were so essential to Europeans at the time that they Christianized them when Western Europe widely adopted Christianity. While May 1 became May Day, and November 1 became All Saints’ Day, the February 1 holiday was pushed to the following day – and would eventually become Groundhog Day.

    First, though, the February holiday was known as “Candlemas,” a day on which Christians brought candles to church to be blessed – a sign of a source of light and warmth for winter. But like the other three “turning points,” it was still a “weather-important” date that signified a change in the seasons, Yoder wrote.

    In 1973, Punxsutawney Phil delighted onlookers with his cuteness and disappointed them by predicting six more weeks of winter.

    And when agriculture was the biggest, if not only, industry of the region, predicting the weather became something of a ritual viewed as essential to the health of crops and townsfolk. There was some mysticism attached to the holiday, too, as seen in a poem from 1678 penned by the naturalist John Ray:

    “If Candlemas day be fair and bright

    Winter will have another flight

    If on Candlemas day it be showre and rain

    Winter is gone and will not come again.”

    The animal meteorology element wasn’t folded in until German speakers came to parts of Europe formerly populated by the Celtic people and brought their own beliefs to the holiday – except, instead of a groundhog, they hedged their bets on a badger. An old European encyclopedia Yoder cited points to the German badger as the “Candlemas weather prophet,” though it’s not clear why. (Sources including the state of Pennsylvania and the Punxsutawney Groundhog Club say the Germans also considered hedgehogs as harbingers of the new season.) When the holiday came overseas with the Pennsylvania Dutch, they traded the badger for an American groundhog, equally shy and subterranean and likely more prevalent in the area in which they settled.

    Many sources claim that the original Groundhog Day took place in 1887, when residents of Punxsutawney set out to Gobbler’s Knob, known as Phil’s “official” home, but the first piece of evidence Yoder found of townspeople trusting a groundhog for the weather, a diary entry, was dated 1840. And since Pennsylvania Dutch immigrants mostly arrived in the mid-to-late 18th century, it’s likely that the holiday existed for decades earlier than we have recorded, per the Library of Congress.

    Part of the reason so many of us know about Groundhog Day is due to the 1993 film of the same name. The phrase “groundhog day” even became shorthand for that déjà vu feeling of reliving the same day over and over. But Punxsutawney Phil became something of a cult celebrity even before the film debuted – he appeared on the “Today” show in 1960, according to the York Daily Record, and visited the White House in 1986. He even charmed Oprah Winfrey, appearing on her show in 1995.

    Before he was a celebrity, though, he was lunch. In a terrible twist, the earliest Groundhog Days of the 19th century involved devouring poor Phil after he made his prediction. The year 1887 was the year of the “Groundhog Picnic,” Yoder said. Pennsylvania historian Christopher Davis wrote that locals cooked up groundhog as a “special local dish,” served at the Punxsutawney Elk Lodge, whose members would go on to create the town’s Groundhog Club. Diners were “pleased at how tender” the poor groundhog’s meat was, Davis said.

    Last year, the apparently immortal and married groundhog Punxsutawney Phil predicted six more weeks of winter. AGAIN?!

    Groundhog meat eventually left the menu of Punxsutawney establishments as the townsfolk realized his worth. In the 1960s, Phil got his name, a nod to “King Phillip,” per the Groundhog Club. (The specific King Phillip he was named for is unclear; Mental Floss pointed out that there has not been a King Phillip of Germany, where many Pennsylvania settlers came from, in centuries). Before that, he was simply “Br’er Groundhog.”

    Punxsutawney Phil’s popularity has inspired several imitators: There’s Staten Island Chuck in New York, Pierre C. Shadeaux of Louisiana and Thistle the Whistle-pig of Ohio, to name a few fellow groundhog weather prognosticators. But there’s only one Phil, and he’s the original.

    Despite their early practice of noshing on Phil’s family, the Punxsutawney Groundhog Club avers that there has only been one Phil since 1886. He’s given an “elixir of life” every year at the summertime Groundhog Picnic, which “magically gives him seven more years of life,” the club said. (Groundhogs can live up to six years in the wild and up to 14 in captivity, per PBS’ Nature, so do with that what you will.)

    Phil also doesn’t have to spend the offseason alone. He’s married to Phyliss, per the Groundhog Club, who does not receive the same elixir of life and so will not live forever like her groundhog husband. There is no official word on how many wives Phil has outlived through over the years.

    As for his accuracy in weather-predicting – Phil’s hit or miss. He often sees his shadow – 107 times, in fact, per the York Daily Record, which has analyzed every single one of Phil’s official weather predictions since the 19th century. Last year, Phil saw his shadow, which coincided with a huge winter storm. Fingers crossed for better luck for us all this year.

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  • Dead chickens and decomposing bodies: Inside South Africa’s power blackout ‘pandemic’ | CNN

    Dead chickens and decomposing bodies: Inside South Africa’s power blackout ‘pandemic’ | CNN


    Johannesburg, South Africa
    CNN
     — 

    Car crashes, opportunistic criminals, rotting food, decomposing bodies, bankrupt businesses, and water shortages. Welcome to life under South Africa’s power blackouts.

    Last week the grim extent of the outages was laid bare when South Africans were advised to bury dead loved ones within four days.

    In a public statement, the South African Funeral Practitioners Association warned that bodies in mortuaries were rapidly decomposing because of the unrelenting electricity outages, putting huge pressure on funeral parlors struggling to process corpses.

    The situation is so bad that the country’s President Cyril Ramaphosa is considering declaring a national disaster, similar to one in 2020 at the height of the Covid pandemic, which had a devastating effect on the country’s economy.

    Last week scores of supporters from the Democratic Alliance opposition party marched under heavy security through the streets of Johannesburg and Cape Town to voice their frustrations over the persistent blackouts.

    Known locally as loadshedding, widespread electricity blackouts are carried out multiple times a day by state-owned energy utility Eskom to avoid the total collapse of the grid.

    Shortages on the electricity system unbalance the network, and Eskom has stated that controlled outages are necessary to ensure reserve margins are maintained, and the system remains stable.

    While the country has been experiencing on-off power outages for years, since September 2022 scheduled blackouts have become routine, affecting every part of South African society.

    For some people, not having access to reliable power can be the difference between life and death.

    Before she died in October 2022, Lis Van Os needed oxygen for 17 hours a day. Her stationary oxygen machine required mains power, making periods of loadshedding extremely stressful, particularly when power did not return as scheduled, her family said.

    Her daughter Karin McDonald was forced to explore backup options such as inverters and a back up oxygen mobile tank, which only lasted short periods.

    “Towards the end (of her life) power outages created a lot of anxiety for everyone,” she said.

    South Africans experienced more than twice as many power cuts in 2022 than in any other year. And things are set to get worse in 2023.

    Even simple daily tasks need to be arranged around loadshedding schedules, including meal planning, travel times, work that requires internet connectivity.

    From preparing baby formula to keeping fans running during the summer heat, not having access to mains power is makes daily life challenging for South Africans.

    Maneo Motsamai, a domestic worker in Johannesburg, says the outages prevents her from simple tasks such as cooking.

    “I boil water to cook mealie meal (maize porridge) and the power goes. I can’t eat, it’s a waste. I can’t cope like that,” Motsamai told CNN.

    Pump stations can’t provide water and many small businesses without access to backup power are having to close shop and lay off employees, according to people CNN spoke to.

    Thando Makhubu runs Soweto Creamery, an ice cream shop in Jabulani, Soweto, on the outskirts of Johannesburg. His family pooled small welfare grants they received during the Covid-19 pandemic to set up the business, but are now feeling the pressure from power outages.

    In early January, the shop was without power for 72 hours, when electricity did not return as scheduled. Thando was forced to shell out money for diesel to power their generator and prevent all his stock melting. He says the outages are costly and destroying their hopes of expanding.

    Bongi Monjanaga, who runs a startup cleaning services company operating across Johannesburg, says the outages affect every part of her fledgling business, such as operating electric cleaning equipment, entering and leaving premises when security gates aren’t functioning, and having internet to invoice clients and complete online tax compliance documents.

    “I find myself in this pool of misery when I’m just trying to start up. I’m just trying to grow,” she says.

    The escalation of power outages is also deeply worrying for South Africa’s food security, driving up prices, and placing an even greater strain on stretched household budgets.

    With modern farming practices ever more reliant on electricity for crop irrigation, processing, and storage, loadshedding is having a huge impact on agricultural output.

    Gys Olivier, a farmer from Hertzogville in Free State province, in east-central South Africa, says he and other farmers in the area have been forced to throw away hundreds of thousands of dollars worth of seed potatoes due to disruptions to the ‘cold chain’ – (the process of keeping produce refrigerated throughout the supply chain.)

    There is also less demand from growers due to water shortages, with pump stations reliant on electricity to operate.

    Protests against power blackouts in South Africa

    “We have done everything we can to make sure there is food on the table for a very good price, but it’s become so capital-intensive to farm,” Olivier says.

    Meanwhile livestock and poultry are dying before they even get to the slaughterhouse.

    A gruesome video circulating on social media shows workers removing 50,000 dead broiler chickens from a farm in North West province, the birds suffocated when power outages caused ventilation systems to stop. The financial damage to the farmer was around ZAR1.6m ($93,300) according to local media reports.

    South Africa is notorious for high crime rates, and loadshedding is making it worse as home security systems fail when the power goes out, giving criminals a field day inside unsecured properties.
    Policing also becomes harder, with officers unable to reach crime scenes fast enough due to congestion when traffic lights are off.

    Tumelo Mogodiseng, General Secretary of the South African Policing Union (SAPU), describes the load-shedding as “a pandemic.”

    He says his members’ lives are now more at risk, with officers unable to see potentially dangerous situations in the darkness, and police stations, many of which don’t have backup power systems, at risk of attack from criminals during blackouts.

    “Police are dying every day in this country. If this is happening in the daylight, what happens when there is no light for them to see at night?”

    Mogodiseng also worries that crimes are going unreported, with citizens fearful of leaving their houses during outages and traveling in the darkness. “Communities won’t travel to police stations to open cases because they are afraid,” he told CNN.

    Gareth Newham, who runs the Justice and Violence Prevention Programme at the Institute for Security Studies (ISS) in Pretoria, says that it’s hard to get solid data on the impact outages are having on crime. While anecdotal evidence suggests criminals are exploiting outages, the recent escalation of loadshedding has coincided with the Christmas holidays, when crime rates typically spike.

    His biggest concern is that continued loadshedding or a temporary grid collapse could lead to a repeat of the coordinated civil unrest, rioting, and looting in parts of South Africa’s KwaZulu-Natal and Gauteng provinces 18 months ago.

    “A complete breakdown in the grid could be the trigger for local level gangs getting more power, and we could see a similar kind of violence to that we saw in July 2021.”

    Under the ruling African National Congress (ANC), in charge since 1994, Eskom has become synonymous with corruption, crime, and mismanagement.

    Last year a judge-led inquiry into graft under the former president, Jacob Zuma, found that there were grounds to prosecute several former Eskom executives.

    The government has failed to build new power stations to keep up with increased demand, and warnings from energy experts on looming supply shortages across the past two decades have gone ignored.

    A 2019 report by the South African Institution of Civil Engineering shows skilled engineers have been leaving the country in droves.

    Despite spending billions of USD on two huge coal power stations, neither works properly.

    Older plants are dilapidated due to a lack of maintenance, and organized crime steals vital coal supplies and cable from the rail lines going from mines to power stations.

    South Africa's opposition party Democratic Alliance protests onto headquarters of ruling ANC against power blackouts in the country

    Renewable energy companies say they are desperate to supply to the grid, but the government has been slow to cut red tape and streamline regulatory processes that would reduce the time frame for environmental authorisations, registration of new projects and grid connection approvals.

    Legal challenges against the government and Eskom are stacking up. Several political parties and trade unions say they will take the government and state utility to court for not upholding their duty to provide electricity.

    With no end in sight to the outages, South Africans are desperate for alternative energy sources, but even they are out of the reach of many citizens.

    Thando Makhubu says he was shocked by the cost to power his ice cream business off-grid. “We were quoted R100,000 ($5,945) and that excluded the solar panels.”

    Karin McDonald, who runs a swimming school, similarly found the upfront costs of solar prohibitive. “We received quotes for solar for the business and house and were not looking at anything less than half a million rand ($29,500) which is a major life decision to make,” she said.

    There is also a long wait for solar. “I know a solar provider that had 40 requests just last week, all for big solar projects, ” said Angus Williamson, a cattle farmer from KwaZulu-Natal province.

    As they come to terms with their new reality, many South Africans are finding it hard to stay optimistic.

    “The light at the end of the tunnel is a train heading in our direction,” said Williamson.

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  • Biden intends to end Covid-19 and public health emergencies on May 11 | CNN Politics

    Biden intends to end Covid-19 and public health emergencies on May 11 | CNN Politics



    CNN
     — 

    President Joe Biden intends to end the Covid-19 national and public health emergencies on May 11, the White House said Monday.

    The White House, in a statement of administration policy announcing opposition to two Republican measures to end the emergencies, said the national emergency and public health emergency authorities declared in response to the pandemic would each be extended one final time to May 11.

    “This wind down would align with the Administration’s previous commitments to give at least 60 days’ notice prior to termination of the (public health emergency),” the statement said.

    The statement added, “To be clear, continuation of these emergency declarations until May 11 does not impose any restriction at all on individual conduct with regard to COVID-19. They do not impose mask mandates or vaccine mandates. They do not restrict school or business operations. They do not require the use of any medicines or tests in response to cases of COVID-19.”

    The statement came in response to a pair of measures before the House that would end the public health emergency and the Covid-19 national emergency.

    The White House weighed in because House Democrats were concerned about voting against the Republican legislation to end the public health emergency that is coming to the floor this week without a plan from the Biden administration, a senior Democratic aide told CNN.

    “Democrats were concerned about the optics of voting against Republicans winding down the public health emergency, absent an understanding of whether and how we intended to do so from the White House,” the aide said. “As soon as we saw this bill, it obviously concerns the White House. So, it was important for them to weigh in.”

    The administration argues that the bills are unnecessary because it intends to end the emergencies anyway. The White House also noted the passage of the measures ahead of May 11 would have unintended consequences, such as disrupting the administration’s plans for ending certain policies that are authorized by the emergencies.

    The White House said it would extend the Covid-19 emergencies one final time in order to ensure an orderly wind-down of key authorities that states, health care providers and patients have relied on throughout the pandemic.

    A White House official pointed to a successful vaccination campaign and reductions in Covid cases, hospitalizations and deaths as a rationale for lifting the emergency declarations. The official said a final extension will allow for a smooth transition for health care providers and patients and noted that health care facilities have already begun preparing for that transition.

    The administration is actively reviewing flexible policies that were authorized under the public health emergency to determine which can remain in place after it is lifted on May 11.

    The aide told CNN that it will be up to every member to decide what is best for their district and how they will vote on the legislation this week. Declaring an end to the public health emergency will also end the border restriction known as Title 42, which will also likely set up a showdown on Capitol Hill.

    The public health emergency has enabled the government to provide many Americans with Covid-19 tests, treatments and vaccines at no charge, as well as offer enhanced social safety net benefits, to help the nation cope with the pandemic and minimize its impact.

    “People will have to start paying some money for things they didn’t have to pay for during the emergency,” said Jen Kates, senior vice president at the Kaiser Family Foundation. “That’s the main thing people will start to notice.”

    Most Americans covered by Medicare, Medicaid and private insurance plans have been able to obtain Covid-19 tests and vaccines at no cost during the pandemic. Those covered by Medicare and private insurance have been able to get up to eight at-home tests per month from retailers at no charge. Medicaid also picks up the cost of at-home tests, though coverage can vary by state.

    Those covered by Medicare and Medicaid have also had certain therapeutic treatments, such as monoclonal antibodies, fully covered.

    Once the emergency ends, Medicare beneficiaries generally will face out-of-pocket costs for at-home testing and all treatment. However, vaccines will continue to be covered at no cost, as will testing ordered by a health care provider.

    State Medicaid programs will have to continue covering Covid-19 tests ordered by a physician and vaccines at no charge. But enrollees may face out-of-pocket costs for treatments.

    Those with private insurance could face charges for lab tests, even if they are ordered by a provider. Vaccinations will continue to be free for those with private insurance who go to in-network providers, but going to an out-of-network providers could incur charges.

    Covid-19 vaccinations will be free for those with insurance even when the public health emergency ends because of various federal laws, including the Affordable Care Act and pandemic-era measures, the Inflation Reduction Act and a 2020 relief package.

    Americans with private insurance have not been charged for monoclonal antibody treatment since they were prepaid by the federal government, though patients may be charged for the office visit or administration of the treatment. But that is not tied to the public health emergency, and the free treatments will be available until the federal supply is exhausted. The government has already run out of some of the treatments so those with private insurance may already be picking up some of the cost.

    The uninsured had been able to access no-cost testing, treatments and vaccines through a different pandemic relief program. However, the federal funding ran out in the spring of 2022, making it more difficult for those without coverage to obtain free services.

    The federal government has been preparing to shift Covid-19 care to the commercial market since last year, in part because Congress has not authorized additional funding to purchase additional vaccines, treatments and tests.

    Pfizer and Moderna have already announced that the commercial prices of their Covid-19 vaccines will likely be between $82 and $130 per dose – about three to four times what the federal government has paid, according to Kaiser.

    The public health emergency has also meant additional funds for hospitals, which have been receiving a 20% increase in Medicare’s payment rate for treating Covid-19 patients.

    Also, Medicare Advantage plans have been required to bill enrollees affected by the emergency and receiving care at out-of-network facilities the same as if they were at in-network facilities.

    This will end once the public health emergency expires.

    But several of the most meaningful enhancements to public assistance programs are no longer tied to the public health emergency. Congress severed the connection in December as part of its fiscal year 2023 government funding package.

    Most notably, states will now be able to start processing Medicaid redeterminations and disenrolling residents who no longer qualify, starting April 1. They have 14 months to review the eligibility of their beneficiaries.

    As part of a Covid-19 relief package passed in March 2020, states were barred from kicking people off Medicaid during the public health emergency in exchange for additional federal matching funds. Medicaid enrollment has skyrocketed to a record 90 million people since then, and millions are expected to lose coverage once states began culling the rolls.

    A total of roughly 15 million people could be dropped from Medicaid when the continuous enrollment requirement ends, according to an analysis the Department of Health and Human Services released in August. About 8.2 million folks would no longer qualify, but 6.8 million people would be terminated even though they are still eligible, the department estimated.

    Many who are disenrolled from Medicaid, however could qualify for other coverage.

    Food stamp recipients had been receiving a boost during the public health emergency. Congress increased food stamp benefits to the maximum for their family size in a 2020 pandemic relief package.

    The Biden administration expanded the boost in the spring of 2021 so that households already receiving the maximum amount and those who received only a small monthly benefit get a supplement of at least $95 a month.

    This extra assistance will end as of March, though several states have already stopped providing it.

    Congress, however, extended one set of pandemic flexibilities as part of the government funding package.

    More Medicare enrollees are able to get care via telehealth during the public health emergency. The service is no longer limited just to those living in rural areas. They can conduct the telehealth visit at home, rather than having to travel to a health care facility. Plus, beneficiaries can use smartphones and receive a wider array of services via telehealth.

    These will now continue through 2024.

    This story has been updated with additional details.

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  • First on CNN: Biden administration to strengthen Obamacare contraceptive mandate in proposed rule | CNN Politics

    First on CNN: Biden administration to strengthen Obamacare contraceptive mandate in proposed rule | CNN Politics



    CNN
     — 

    The Biden administration wants to make it easier for women to access birth control at no cost under the Affordable Care Act, reversing Trump-era rules that weakened the law’s contraceptive mandate for employer-provided health insurance plans.

    The proposed rule, unveiled Monday by the departments of Health and Human Services, Labor and Treasury, would remove an exemption to the mandate that allows employers to opt out for moral convictions. It would also create an independent pathway for individuals enrolled in plans offered by employers with religious exemptions to access contraceptive services through a willing provider without charge.

    The proposed rule would leave in place the existing religious exemption for employers with objections, as well as the optional accommodation for contraceptive coverage.

    The administration crafted the proposed rule keeping in mind the concerns of employers with religious objections and the contraceptive needs of their workers, a senior HHS official told CNN.

    “We had to really think through how to do this in the right way to satisfy both sides, but we think we found that way,” the official said, stressing that there should be no effect on religiously affiliated employers.

    Students at religiously affiliated colleges would have access to the expanded accommodation, just like workers in group health plans where the employer has claimed the exemption.

    Now that the proposed rule has been announced, the public will have the opportunity to comment during the next few months. Officials expect there to be many thousands of public comments, and it will be “many months” before the rule could be finalized.

    HHS expects the proposal would affect more than 100 employers and 125,000 workers, mainly through providing the proposed independent pathway for employees to receive no-cost contraception.

    Women using that pathway would obtain their birth control from a participating provider, who would be reimbursed by an insurer on the Affordable Care Act exchanges. The insurer, in turn, would receive a credit on the user fee it pays the government.

    “If this rule is finalized, individuals who have health plans that would otherwise be subject to the ACA preventive services requirements but have not covered contraceptive services because of a moral or religious objection, and for which the sponsoring employer or college or university has not elected the optional accommodation, would now have access,” Centers for Medicare and Medicaid Services Administrator Chiquita Brooks-LaSure said in a news release.

    How many people benefit, however, would depend on whether women and their health care providers know the independent pathway exists and whether providers and insurers are willing to set it up.

    “We’ll just have to see how widely that information is spread and in what way to providers and individuals,” said Laurie Sobel, associate director for Women’s Health Policy at the Kaiser Family Foundation, noting that the proposed rule would not require data collection to show the pathway’s takeup.

    But the Planned Parenthood Federation of America cheered the initiative.

    “Employers and universities should not be able to dictate personal health care decisions and impose their views on their employees or students,” said Alexis McGill Johnson, the group’s CEO. “The ACA mandates that health insurance plans cover all forms of birth control without out-of-pocket costs. Now, more than ever, we must protect this fundamental freedom.”

    The requirement to provide no-cost contraception is not in the Affordable Care Act itself. Instead, HHS under former President Barack Obama included it as one of the women’s preventive services that all private insurance plans must offer without charge.

    The mandate was controversial from the start, sparking lawsuits from religiously affiliated employers and closely held companies that said it violated their beliefs. Exemptions and accommodations have been available for such employers.

    The Trump administration, however, weakened the mandate. Under the rules issued in 2018, entities that have “sincerely held religious beliefs” against providing contraceptives are not required to do so. That provision also extends to organizations and small businesses that have objections “on the basis of moral conviction which is not based in any particular religious belief.”

    The rules also include an optional accommodation that lets objecting employers and private universities remove themselves from providing birth control coverage while still allowing their workers and dependents access to contraception. But the employer or university has to voluntarily elect the accommodation, which risks leaving many without access.

    The Trump administration changes were temporarily blocked after a Pennsylvania district court judge issued a nationwide injunction in 2019. But the following year, the Supreme Court ruled that the administration could expand exemptions for employers who have religious or moral objections to covering contraception.

    At the time, the National Women’s Law Center estimated that the ruling would impact about 64.3 million women in the United States with insurance coverage that included birth control and other preventive services without out-of-pocket costs.

    Employers are not required to notify HHS if they have a moral objection. The agency estimates about 18 employers have claimed that exemption and around 15 employees are affected.

    Still, if the rule is finalized, senior HHS officials say it is “plausible” there could be potential lawsuits brought by religiously affiliated employers – similar to what has been seen in the past.

    “There’s no new obligation on them to participate in any sort of process. This is simply an additional channel for employees in those employer health plans to receive access to contraceptive services,” another senior HHS official said.

    The contraceptive mandate has taken on increased importance now that the Supreme Court has overturned Roe v. Wade, allowing many states to impose severe restrictions on abortion access.

    The Biden administration in turn has focused on continuing access to birth control at no cost. The Health, Labor and Treasury department secretaries last year met with health insurers and issued guidance underscoring Obamacare’s contraceptive coverage requirements for private insurance under the Affordable Care Act.

    “Now more than ever, access to and coverage of birth control is critical as the Biden-Harris Administration works to help ensure women everywhere can get the contraception they need, when they need it, and – thanks to the ACA – with no out-of-pocket cost,” HHS Secretary Xavier Becerra said in a news release.

    This story has been updated with additional information.

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  • CEO pay cuts could be just the start | CNN Business

    CEO pay cuts could be just the start | CNN Business


    New York
    CNN Business
     — 

    Corporate boards are slashing the pay of some leading CEOs in a new trend that could just be getting started.

    The pay cuts are hitting some of America’s best-known and highest-paid bosses, including Apple CEO Tim Cook, Morgan Stanley CEO James Gorman and Goldman Sachs CEO David Solomon.

    The moves follow a dreadful year in the stock market – 2022 was the S&P 500’s worst year since 2008 – and come as a growing number of corporations lay off rank-and-file workers to brace for a potential recession.

    For example, Goldman Sachs laid off 3,200 employees earlier this month amid a downturn in Wall Street dealmaking. The bank then disclosed on Friday that Solomon’s 2022 pay is being cut by nearly 30%. Goldman Sachs’ profit dropped 49% last year as the slowdown in dealmaking curbed advisory fees.

    “This is a show of solidarity. CEOs need to share the pain,” said Nell Minow, vice chair of ValueEdge Advisors, which advises institutional investors on corporate governance matters.

    A similar pay cut could be coming for Sundar Pichai, the CEO of Google parent Alphabet

    (GOOGL)
    .

    After Alphabet announced 12,000 job cuts this month, Pichai told employees that top executives would take a “very significant” pay cut, Business Insider reported. Google did not respond to a request for comment.

    But don’t feel too badly for these top execs. They’re still raking in serious cash and stock awards, just not quite as much as in the past.

    Apple, for example, said it is cutting the target pay package of Cook by 40%. But that still leaves him with a massive $49 million in total compensation.

    “They are still overpaid. Let me super clear about that,” said Minow.

    Among the 500 largest public companies by revenue, the median CEO made $14.2 million in fiscal 2021, up 18.9% from the year before, according to the latest research from Equilar.

    Tech bosses have received the biggest pay hikes, with the median CEO pay surging by 42.1% in 2021 to $19.1 million, Equilar said.

    Earlier this month, Morgan Stanley announced Gorman made $31.5 million in total compensation for 2022, down 10% from the year before. The Wall Street bank said its compensation committee took into consideration the fact that “in a challenging economic and market environment firm performance for 2022 was not as strong as the prior year” when it enjoyed record results.

    Minow is relieved that some boards are imposing pain on CEOs.

    “That’s exactly the way pay is supposed to work,” Minow said. “The problem with pay traditionally is it’s been all upside and no downside. CEOs would often get all the credit and money for good times and then blame El Nino or some extraneous force for the downside. Now they are being forced to accept more responsibility.”

    Of course, some of that responsibility is coming because the rules have changed.

    After the 2010 Dodd-Frank law, regulators have required public companies to give shareholders a voice on compensation issues. So-called “Say on Pay” votes are advisory, meaning companies can still go forward even if 100% of shareholders vote no. Still, having shareholders reject pay packages is an embarrassment companies try to avoid.

    Last year, JPMorgan Chase suffered a blow when its shareholders voted down a massive $52.6 million retention bonus that was planned for CEO Jamie Dimon.

    This month, JPMorgan announced Dimon’s pay will be unchanged at $34.5 million – even though wages are rising for average workers. The bank also said it decided not to give Dimon a special award for the year.

    That means Dimon’s pay isn’t budging even as wages go up for many employees.

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  • Here’s why you should always wait for the earnings call | CNN Business

    Here’s why you should always wait for the earnings call | CNN Business

    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
     — 

    Investors are pretty bad at living in the moment. We’re currently in the thick of fourth quarter earnings reports, but traders don’t seem to care about how companies fared during the final months of 2022. They’re more focused on what’s going to happen in the future.

    Case-in-point: Earnings calls, where top execs pontificate about their economic outlook, have been moving markets more than earnings-per-share and revenue reports.

    What’s happening: The mantra on Wall Street has become, as Ritholtz Wealth Management CEO Josh Brown puts it, “ignore the numbers, wait for the call.”

    Microsoft reported great fourth quarter earnings last Tuesday that beat Wall Street’s expectations, but the stock dropped 4% the next day. That’s because CEO Satya Nadella got on an earnings call with investors and warned of a slowdown in the company’s cloud business and software sales. His negative outlook came just as the company announced it was letting go of 10,000 employees, further spooking investors. 

    Other tech companies are following suit — while things are fine for the time being, they’re reporting that the future is foggy.

    IBM stock sank 4.5% last Thursday even as the tech titan beat Wall Street’s Q4 expectations. The reason for the drop might be because Jim Kavanaugh, IBM’s finance chief, warned on the conference call that it would be wise to expect the company’s total 2023 revenue growth to be on the low end. IBM also announced layoffs – the company said it plans to cut around 3,900 jobs or 1.5% of its total workforce. 

    The economic environment is rapidly changing. CEOs on earnings calls are talking more about recession than inflation now, according to an analysis by Purpose Investments.

    Wall Street is also beginning to fear an economic downturn more than painful rate hikes and as a result investors are putting more weight on CEO and CFO forecasts.

    And they’re looking bleak. As of Friday, 19 companies in the S&P 500 had issued forward earnings-per-share guidance for the first quarter of 2023, according to FactSet data. Of these 19 companies, 17, or 89%, issued negative guidance. That’s well above the 5-year average of 59%.

    “My best guess is that cautious tones on conference calls will be the norm, not the exception,” wrote Brown in a recent post. These slowdowns have been partially factored into stock prices, he said, “but not necessarily in full.”

    The upside: Market reaction appears to go both ways. American Express missed on earnings last week but said that credit card spending was hitting new records and that the future looks bright. The stock shot up more than 10%. 

    Prices at the pump typically fall during the coldest months as wintry weather keeps Americans off the roads. But something unusual is happening this year, reports my colleague Matt Egan. Gas prices are rocketing higher.

    The national average for regular gas jumped to $3.51 a gallon on Friday and remained there through the weekend, according to AAA. Although that’s a far cry from the record of $5.02 a gallon last June, gas prices have increased by 12 cents in the past week and 41 cents in the past month.

    All told, the national average has climbed by more than 9% since the end of last year – the biggest increase to start a year since 2009, according to Bespoke Investment Group.

    Why are gas prices jumping? It’s not because of demand, which remains weak, even for this time of the year. Instead, the problem is supply.

    The extreme weather in much of the United States near the end of last year caused a series of outages at the refineries that produce the gasoline, jet fuel and diesel that keep the economy humming. US refineries are operating at just 86% of capacity, down from the mid-90% range at the start of December, according to Bespoke.

    Beyond the refinery problems, oil prices have crept higher, helping to drive prices at the pump northward. US oil prices have jumped about 16% since December partially due to expectations of higher worldwide demand as China relaxes its Covid-19 policies and also because oil markets are no longer receiving massive injections of emergency barrels from the Strategic Petroleum Reserve.

    What’s next: Expect more pain at the pump. Patrick De Haan, head of petroleum analysis at GasBuddy, worries the typical springtime jump in prices will be pulled forward.

    “Instead of $4 a gallon happening in May, it could happen as early as March,” De Haan told CNN. “There is more upside risk than downside risk.”

    A return of $4 gas would be painful to drivers and could dent consumer confidence. Moreover, pain at the pump would complicate the inflation picture as the Federal Reserve debates whether to slow its interest rate hiking campaign.

    Goldman Sachs had a rough time in 2022, and the investment bank’s CEO, David Solomon, is being punished for it. Well, kind of. 

    The investment banking giant said in a Securities and Exchange Commission filing Friday that Solomon received $25 million in annual compensation last year. While that is still a very large amount of money, it’s down nearly 30% from the $35 million that Solomon raked in during 2021, reports my colleague Paul R. La Monica

    Solomon’s $2 million annual salary is unchanged. But the company said that his “annual variable compensation,” paid in a mix of performance-based restricted stock units and cash, was well below 2021 levels.

    Goldman Sachs (GS) shares fell more than 10% in 2022. The company also  reported a 16% drop in revenue in the fourth quarter and profit plunge of 66% earlier this month, mainly due to the lack of merger activity and initial public offerings.

    Maybe Solomon can make that extra $10 million with payouts from his burgeoning DJ career

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  • Some auto insurers are refusing to cover certain Hyundai and Kia models | CNN Business

    Some auto insurers are refusing to cover certain Hyundai and Kia models | CNN Business



    CNN
     — 

    Progressive and State Farm, two of America’s largest auto insurers, are refusing to write policies in certain cities for some older Hyundai and Kia models that have been deemed too easy to steal, according to the companies.

    Several reports say the companies have stopped offering insurance on these vehicles in cities that include Denver, Colorado and St. Louis, Missouri. The insurance companies did not tell CNN which cities or states were involved.

    The Highway Loss Data Institute released insurance claims data last September that confirmed what various social media accounts had been saying: Some 2015 through 2019 Hyundai and Kia models are roughly twice as likely to be stolen as other vehicles of similar age, because many of them lack some of the basic auto theft prevention technology included in most other vehicles in those years, according to the HLDI.

    Specifically, these SUVs and cars don’t have electronic immobilizers, which rely on a computer chip in the car and another in the key that communicate to confirm that the key really belongs to that vehicle. Without the right key, an immobilizer should do just that – stop the car from moving.

    Immobilizers were standard equipment on 96% of vehicles sold for the 2015-2019 model years, according the HLDI, but only 26% of Hyundais and Kias had them at that time. Vehicles that have push-button start systems, rather than relying on metal keys that must be inserted and turned, have immobilizers, but not all models with turn-key ignitions do.

    Stealing these vehicles became a social media trend in 2021, according to HLDI, as car thieves began posting videos of their thefts and joyrides and even videos explaining how to steal the cars. In Wisconsin, where the crimes first became prevalent, theft claims of Hyundais and Kias spiked to more than 30 times 2019 levels in dollar terms.

    “State Farm has temporarily stopped writing new business in some states for certain model years and trim levels of Hyundai and Kia vehicles because theft losses for these vehicles have increased dramatically,” the insurer said in a statement provided to CNN. “This is a serious problem impacting our customers and the entire auto insurance industry.”

    Progressive is also cutting back on insuring these cars in some markets, spokesman Jeff Sibel said in an emailed statement.

    “During the past year we’ve seen theft rates for certain Hyundai and Kia vehicles more than triple and in some markets these vehicles are almost 20 times more likely to be stolen than other vehicles,” he wrote. “Given that we price our policies based on the level of risk they represent, this explosive increase in thefts in many cases makes these vehicles extremely challenging for us to insure. In response, in some geographic areas we have increased our rates and limited our sale of new insurance policies on some of these models.”

    Progressive continues to insure those who already have policies with the company, he said. Progressive is also providing them with advice on how to protect their vehicles from theft.

    Michael Barry, a spokesman for the Insurance Information Institute, said it was very unusual for auto insurers to simply stop writing new policies on a given make or model of vehicle.

    “They generally want to expand their market share depending on where they’re doing business,” he said.

    Hyundai and Kia operate as separate companies in the United States, but Hyundai Motor Group owns a large stake in Kia and various Hyundai and Kia models share much of their engineering.

    Engine immobilizers are now standard on all Kia and Hyundai vehicles, the companies said in separate statements. Both automakers also said they are developing security software for vehicles that were not originally equipped with an immobilizer. Kia said it has begun notifying owners of the availability of this software, which will be provided at no charge. Hyundai said its free software free update will be available next month.

    Hyundai also said it is providing free steering wheel locks to some police departments around the country to give local residents who have Hyundai models that could be easily stolen. Hyundai dealers are also selling and installing security kits for the vehicles, the company said.

    Correction: A previous version of this story misstated the cost of Hyundai security kits.

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  • Opinion: The rare bipartisan opportunity House Republicans should take advantage of | CNN

    Opinion: The rare bipartisan opportunity House Republicans should take advantage of | CNN

    Editor’s Note: Patrick T. Brown is a fellow at the Ethics and Public Policy Center, a conservative think tank and advocacy group based in Washington, DC. He is also a former senior policy adviser to Congress’ Joint Economic Committee. Follow him on Twitter. The views expressed in this piece are his own. View more opinion on CNN.



    CNN
     — 

    With only a thin and fractious majority in the House, the GOP is facing two years of struggling to set any kind of positive agenda. But one thing every elected Republican would agree on is the need to scrutinize the Biden administration.

    Courtesy Patrick T. Brown

    Rep. James Comer of Kentucky, the new chairman of the House Oversight Committee, has already been hard at work, firing off letters demanding answers to pointed questions on border photo ops, President Joe Biden’s handling of classified documents, presidential visitor logs, remote work among top federal employees and Hunter Biden.

    This is, of course, business as usual. The party that doesn’t control the White House will always seek to score political points on possible bureaucratic scandals. In return, Democrats’ instinctive reaction might be to circle up the wagons and seek to stonewall or downplay as many of these efforts as possible.

    But one area of focus for the Oversight Committee deserves to be taken seriously, not just as a political point-scoring operation, but as an earnest attempt to improve how government works. A genuine bipartisan commitment can and should be made to evaluate the extent of fraud in the pandemic-era safety net measures. A better understanding of where the system failed would not only shine a light on how some funds were misspent but also lay the groundwork for better administration of safety-net benefits, in ways applicable and valuable even outside of the unique circumstances of a global pandemic.

    Recall that as the initial wave of coronavirus cases hit US shores, economists feared we could be headed for an economic meltdown. People stopped going about their daily lives, stay-at-home orders went into effect and businesses responded by laying off workers left and right. The unemployment rate spiked to 14.7% in April 2020, the highest level in the post-World War II era.

    Congress wanted to provide aid as quickly as possible; there simply wasn’t time to sit around and construct the ideal policies. As part of the frenetic response, the federal government used the often-clunky unemployment insurance systems run by states to try to backstop households’ finances.

    Fraud became an issue due to a number of factors, according to a June 2022 report from the Government Accountability Office, including unclear federal guidance, ill-equipped state offices and a relaxation of normal eligibility rules. It didn’t help that 32 states run their unemployment insurance systems on outdated infrastructure, often developed in the 1970s and 1980s, according to that same report. These systems make it difficult for states to have the flexibility and responsiveness necessary to run benefit programs efficiently – even when there isn’t a global pandemic.

    The underlying structure of unemployment insurance may have been an issue as well – the federal government provides support and technical assistance, while states determine eligibility and ensure accurate payments. The jerry-rigged systems in many states couldn’t handle the surge of applicants and a newly created unemployment insurance program relied on self-certification. Without any requirements to prove lost income, the program opened the door to bad actors.

    But some of the headlines about the amount of fraud in pandemic assistance are likely overblown. One widely-repeated claim about the ubiquity of fraud was advanced not by a disinterested party but by a company that sells ID verification systems. The GAO report estimates the amount of unemployment insurance fraud is likely over $60 billion (or about 7% of total $878 billion spent), although the true amount may not be knowable.

    $60 billion sounds like a lot of money, but some could argue the result justified the leaky process. Research by the Brookings Institution found that the expanded unemployment benefits delivered the most aid to lower-income workers, stabilizing the broader economy by keeping consumption stable. At the peak of Covid’s impact, millions of workers every week were applying for unemployment insurance; if excessive concern about fraud had prevented rolling out the federal expansion of benefits, it could have taken a lot longer for the economy to recover.

    But with the worst of the pandemic in the rear-view mirror, cracking down on people who abused the system and making it harder for future scammers to do the same is an appropriate area for the Oversight Committee to focus on. A full, bipartisan Congressional inquiry could spotlight the weaknesses of the current system and where it was taken advantage of in order to lay the groundwork for future efforts to improve the way benefits are disbursed.

    Not doing so would allow distrust around government programs to fester. Some voters who hear stories about fraudsters taking advantage of pandemic-era assistance – especially blatant examples of people who listed their name as “N/A” or claimed that they owned nonexistent farms – may lose faith in government’s ability to function properly. Knowing that the expanded assistance helped the economy does nothing to change or address the fact that some people took advantage of loopholes in the system.

    Some initial steps have been taken to address this lingering concern. The Pandemic Response Accountability Committee, which was created as part of the Coronavirus Aid, Relief and Economic Security (CARES) Act in 2020, has provided publicly available data on how emergency pandemic funds were spent. Last summer, Congress passed bipartisan bills extending the statute of limitations to prosecute individuals who committed fraud through the Paycheck Protection Program or the Economic Injury Disaster Loan Program. And Democrats, such as Rep. Jim Clyburn of South Carolina, who previously served as the chair of a subcommittee on the coronavirus response, have rightly pointed out that small business aid during the pandemic was also plagued by fraud and improper payments.

    Yet more could be done. A GAO report in October 2021 made six recommendations about how the Department of Labor could stem fraud in unemployment insurance programs, but a recent follow-up found the department had not implemented any of them. The deluge of cases has left investigators overwhelmed, and Congress could beef up funding for the agents that investigate pandemic fraud.

    Last year, the Biden administration announced initial steps to combat fraud and identity theft in pandemic relief, but it hasn’t made a priority of supporting bills like the one introduced in 2021 by Sen. Ron Wyden of Oregon, which would have modernized the unemployment insurance program. Helping states develop better systems of determining eligibility and automating basic safeguards could make it easier to keep scammers out and make sure the truly deserving get the benefits they need.

    Republicans are right to put the spotlight on those who took advantage of pandemic-era programs. Democrats should join them. Getting benefits into the hands of people who merit them and keeping them out of the hands of people who don’t should be something both parties agree on. Amid all the other controversies that take up political oxygen, a concerted effort to crack down on wrongdoing and improve how our social safety net functions could be a welcome breath of bipartisan air.

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