Author: CNBC News

WASHINGTON — The U.S. House of Representatives adjourned for the day Tuesday without a speaker, after Republican leader Kevin McCarthy, R-Calif., failed in three consecutive votes to secure enough support to be elected to the post.

The failed votes marked the first time in 100 years that the majority party in the House has not elected a speaker on its first vote. The staunch opposition to McCarthy from a core group of Republicans grew larger over the course of the day, throwing the party into chaos.

Democrats, meanwhile, appeared to enjoy the spectacle of their opponents so deeply divided.

During each of the three voice votes, every Democrat on the floor rallied unanimously around incoming Minority Leader Hakeem Jeffries, D-N.Y. But a sect of conservative Republicans split from their party to back other candidates, including longtime McCarthy ally Rep. Jim Jordan, R-Ohio.

In an unexpected twist, McCarthy actually lost support as the voting continued, when in the third round Florida Republican Rep. Byron Donalds announced his support for Jordan, after having voted twice for McCarthy.

As a result of Donalds’ defection, McCarthy won 202 of the 218 votes needed to secure the post in the third round, one vote less than he had in the first two ballots.

Jordan, who nominated and voted for McCarthy, won 20 votes in the third round. Jeffries, the incoming Democratic minority leader, won 212 votes in each of the three rounds.

Following the vote, Donalds suggested his caucus take a break from voting.

“The reality is Rep. Kevin McCarthy doesn’t have the votes,” Donalds wrote on Twitter. “I committed my support to him publicly and for two votes on the House Floor. 218 is the number, and currently, no one is there.

“Our conference needs to recess and huddle and find someone or work out the next steps, but these continuous votes aren’t working for anyone,” Donalds wrote. “When the dust settles, we will have a Republican Speaker, now is the time for our conference to debate and come to a consensus.”

McCarthy’s failure to win public support from his entire caucus has cast a shadow over the new Republican majority, exposing divisions within the party that have existed for decades. The differences were deepened by former President Donald Trump, who emboldened a small band of ultra-conservatives.

Trump eventually backed McCarthy’s bid for speaker, as did other influential conservatives such as Rep. Marjorie Taylor Greene, R-Ga. But the ex-president’s sway within the GOP caucus did not prevent McCarthy’s repeated defeat.

Following the failed votes Tuesday, Trump pointedly declined to endorse McCarthy with as much gusto as he has previous.

“We’ll see what happens,” Trump told NBC News, when asked directly if he was sticking with the GOP leader. “I got everybody calling me wanting my support. But let’s see what happens.”

The mood on the House floor Tuesday started out cheerful and energetic, due in part to the presence of members’ children and family members, many of whom came to witness what they expected would be swearing in ceremonies.

But it grew more tense as the day wore on. Until a speaker is elected, the rest of the chamber’s members-elect cannot be sworn in, because their oath of office is administered by the speaker.

While the House held multiple rounds of voting, the Senate, which is again controlled by Democrats, swore in Washington Sen. Patty Murray as the Senate president pro tempore, making her the first woman in American history to hold the position.

While the vice president is technically the president of the Senate, the president pro tem presides over the chamber on a daily basis, signing legislation and administering oaths of office.

The Senate pro tem is also typically third in line for the presidency, after the vice president and the Speaker of the House.

But on Tuesday night, with no speaker elected in the House yet, Murray temporarily became second in line.

Early in the day, McCarthy had vowed to continue holding votes as long as it took to win 218, effectively trying to call his opponents’ bluff.

But after the third vote, both Democrats and Republicans grew visibly anxious to leave their seats. Unlike most votes, where members can vote in absentia, the speaker vote must be conducted in person, leaving no room for members to come and go.

With no immediate solution to the Republican impasse on the horizon, the House held a voice vote on a motion to adjourn that was loudly endorsed by both parties.

McCarthy’s conservative opponents still have a long list of demands they believe McCarthy has failed to meet.

As the Federal Reserve continues to hike interest rates, you may assume you’re earning more on the money in your savings account.

But that may not be the case.

Carolyn McClanahan, a certified financial planner at Life Planning Partners in Jacksonville, Florida, was recently surprised when a client told her he was hardly making any interest on his cash.

The interest rate on his Capital One account was 0.3%, far lower than the 3.3% annual percentage yield the firm is currently advertising for new savings accounts. McClanahan discovered the same situation when she checked her own Capital One account.

“I was not happy,” McClanahan said.

While a call to Capital One’s customer service revealed it was possible to access the higher interest rate by opening a new account, McClanahan decided it was better to move the money elsewhere.

“I’ve been recommending Capital One for a long time, and they are now off my list,” McClanahan said.

Capital One did not immediately respond to requests for comment.

The Federal Reserve has raised the federal funds rate to the highest levels since 2007. While that makes borrowing more expensive for credit cards and other accounts, the expectation is that it will also push up the interest consumers can make on their cash savings.

Some online savings accounts are touting rates as high as 4%. Some certificates of deposit, or CDs, may provide higher rates, depending on the term.

Rates are expected to climb even higher as Federal Reserve poised to continue its hiking cycle in 2023. Bankrate.com predicts top-yielding national money market and savings accounts could climb to 5.25% by year end.

Yet like McClanahan, others may be in for a surprise if they realize their accounts are not keeping up with those top rates.

“Consumers need to check their accounts at least once a month to see what their accounts are earning,” said Ken Tumin, senior industry analyst at LendingTree and founder of Deposit Accounts.

“Don’t assume it’s the latest greatest rate,” he said.

More from Personal Finance:
From ‘Quiet Quitting’ to ‘Loud Layoffs,’ career trends to watch in 2023
How to use pay transparency to negotiate a better salary
‘This is a crisis.’ Why more workers need access to retirement savings

Following Fed rate hikes, online savings accounts should generally be in the ballpark of the federal funds rate within about a month, according to Tumin.

There are signs that may help consumers spot when they may get shortchanged on rates.

Watch for changing account names, Tumin said. If a bank is touting savings offers under a new account name from when you opened your account, the terms you are subject to might not be the latest.

If you see a new account, often you can request to be upgraded.

“That’s an easy way to get the benefit of the higher rate,” Tumin said.

Also be more vigilant when a bank, such as Emigrant Bank, has more than one online division, Tumin said. In September, Emigrant’s Dollar Savings Direct division was the first to offer 3% on an account, which eventually climbed to 3.5%.

Now, however, its My Savings Direct division has the highest rate for an online account, with 4.35%, Tumin noted.

LONDON — The U.K. economic contraction of 2023 will be almost as deep as that of Russia, economists expect, as a sharp fall in household living standards weighs on activity.

In its 2023 macro outlook, Goldman Sachs forecast a 1.2% contraction in the U.K. real GDP over the course of this year, well below all other G-10 (Group of Ten) major economies. This is set to be followed by a 0.9% expansion in 2024, the lender anticipates.

related investing news

The figure places Britain only fractionally ahead of Russia, which the bank projects will see a 1.3% contraction in 2023 as it continues to wage war in Ukraine and weather punitive economic sanctions from Western powers. This will be followed by a 1.8% expansion in 2024, Goldman figures suggest.

The Wall Street giant forecasts U.S. expansions of 1% in 2023 and 1.6% in 2024. Germany — the next worst performer among major economies after Russia and the U.K. — is expected to see a 0.6% contraction this year, then expand by 1.4% next year.

Goldman’s projections for the U.K. are below what it cites as a market consensus that sketches a 0.5% contraction in 2023 and a 1.1% expansion in 2024. However, the OECD has also forecast that the U.K. will lag significantly behind other developed nations in the coming years despite facing the same macroeconomic headwinds, putting London closer in performance to Russia than to the rest of the G-7.

The euro area and the U.K. are both already in recession, Goldman Chief Economist Jan Hatzius and his team concluded, since both have endured a “much bigger and more drawn-out increase in household energy bills” that will drive inflation to higher peaks than seen elsewhere.

“In turn, high inflation is set to weigh on real income, consumption, and industrial production. We forecast further declines in real income of 1.5% in the euro area through 2023Q1 and 3% in the U.K. through 2023Q2, before a pickup in H2,” they said.

The U.K. independent Office for Budget Responsibility projects that the country faces its sharpest fall in living standards on record. Alongside Finance Minister Jeremy Hunt’s budget statement in November, the OBR forecast that real household disposable income — a measure of living standards — will fall by 4.3% in 2022-23.

Consultancy firm KPMG projected that the U.K. real GDP will contract by 1.3% in 2023, amid a “relatively shallow but protracted recession,” before seeing a partial 0.2% recovery in 2024.

The squeeze on incomes was cited as the main driver, as higher inflation and interest rates significantly curtail household purchasing power. The Bank of England raised rates by 50 basis points to 3.5% in December, as it looked to rein in inflation, which eased slightly last month from the 41-year high of November.

KPMG expects the central bank to increase the bank rate to 4% during the first quarter of this year before adopting a “wait-and-see” approach, as inflation gradually eases.

“The labour market is set to start deteriorating from the first half of 2023, with the unemployment rate reaching 5.6% by mid-2024, representing an increase of around 680,000 people,” KPMG economists said in an outlook report in December.

Yael Selfin, chief economist at KPMG U.K., said the spike in food and energy prices and higher overall inflation had already cut into household purchasing power.

“Rising interest rates have added another headwind to growth. Lower income households are particularly exposed to the mix of current price pressures, as the most affected spending categories largely fall on necessities, with few substitutes in the short run,” Selfin said in the report.

“Households are expected to rein in spending on discretionary items in 2023 in response to the squeeze on income. As consumers cut back on spending, we anticipate a sharp reduction in non-essential categories of spend by those households most affected by the rise in energy and food costs, including spending on eating out and entertainment.”

Along with the global headwinds arising from the war in Ukraine and supply bottlenecks related to China’s Covid-19 measures and the aftermath of the pandemic, the U.K. faces unique domestic obstacles such as a long-term sickness crisis that has severely tightened its labor market. The country is also experiencing heavily depleted trade as a result of Brexit.

“Although commodities drove the initial headline surge [in inflation], price pressures have broadened significantly across core categories in both the euro area and the U.K. following upside inflation surprises,” Goldman’s Hatzius said.

“In fact, U.K. core price pressures are now the broadest across the G10, with a perfect storm of an energy crisis (like continental Europe) and an overheated labor market (like the US).”

Apple shares fell more than 3% trading on Tuesday, giving the iPhone maker a market capitalization under $2 trillion for the first time since May.

Apple fell $3.74% to a price of $130.20 per share, a 52-week low, giving the company a valuation of $1.99 trillion at market close on Tuesday.

Apple first hit a $2 trillion valuation in August 2020, as the pandemic boosted its sales of computers and phones for remote work and school. It briefly hit a market value over $3 trillion during trading in January 2022.

Apple struggled with iPhone 14 Pro shipments during the holiday season because of Covid restrictions on its primary factory in China. Investors are also wary of rising interest rates and declining consumer confidence, which could hurt demand for Apple’s premium-priced products.

A recent report from supply chain analyst Trendforce said it saw Apple’s iPhone shipments declining 22% in the December quarter. Apple has told suppliers to make fewer components for products including AirPods, Apple Watch and MacBook laptops, according to Nikkei.

Apple is the last big company to give up its $2 trillion valuation. Previously, Microsoft hit the $2 trillion mark but retreated from it in 2022.

The broader market was down Tuesday, with the S&P 500 index falling nearly under 1% during trading.

In 2022, Apple underperformed the S&P 500 index, which declined more than 18%. Apple’s share price fell nearly 27% in 2022.

Jeremy Renner was in intensive care Monday after undergoing surgery, his representative said.

The actor, 51, was injured Sunday while plowing snow near Reno, Nevada, and air-flighted to a nearby hospital, the Washoe County Sheriff’s Office said Sunday evening, confirming an earlier statement by Renner’s representative.

On Monday, the actor’s spokesperson said that Renner had “suffered blunt chest trauma and orthopedic injuries” that required surgery.

The Washoe County Sheriff’s Office said it responded to a report of a traumatic injury in the area of Mount Rose Highway in Reno, Nevada, at around 9 a.m. local time (12 p.m. ET) Sunday.

It said Renner was the only person injured.

The office’s Major Accident Investigation Team is looking into the incident, it said.

It was not clear exactly where he was hurt. Renner has a home in Nevada, according to The Associated Press.

In 2015, he posted a photo to Instagram of a snowcat vehicle, which is used in snowy conditions. It was not immediately clear whether the vehicle was involved in Sunday’s incident.

Renner is well-known for his role as Hawkeye as part of Marvel’s Avengers squad. He is also a two-time Oscar nominee for his performances in “The Hurt Locker” and “The Town.”

Renner’s representative said Monday that his family wanted to express their gratitude to his doctors and nurses, first responders, and others.

“They are also tremendously overwhelmed and appreciative of the outpouring 

Stocks fell Tuesday, giving up earlier gains, as concerns such as rising rates and high inflation that knocked the market down last year continued to trouble investors in the new year.

The S&P 500 fell 0.43%, slipping from highs of the day when December’s manufacturing index declined at the fastest pace since May 2020. The Dow Jones Industrial average fell 114 points, or 0.29% and the Nasdaq Composite shed 0.70%.

Shares of Tesla and Apple both slipped, weighing on the broader market and carrying forward a main theme from 2022, when the technology sector was hit hard as the Federal Reserve raised rates to fight inflation. Tesla fell more than 9% following disappointing fourth quarter deliveries and Apple shed more than 3% on reports that it will cut production due to weak demand.

The theme may continue in 2023 as the central bank is poised to continue to hike interest rates in the coming months, stoking fears that the U.S. economy may fall into a recession.

“A recessionary environment in 2023 could further hamper tech stock performance in the new year, as investors’ thirst would increase for value oriented companies and those with higher profit margins, more consistent cash flows, and robust dividend yields,” wrote Greg Bassuk, CEO of AXS Investments in New York.

The major averages closed 2022 with their worst annual losses since 2008, snapping a three-year win streak. The Dow ended the year down about 8.8%, and 10.3% off its 52-week high. The S&P 500 lost 19.4% for the year and sits more than 20% below its record high. The tech-heavy Nasdaq tumbled 33.1% last year.

Of course, there may be brighter days ahead. History also shows the U.S. stock market tends to rebound after down years. In fact, the S&P 500 has, on average, rebounded by 15% in the next year following a year where it lost more than 1%.

Investors are getting a bundle of data in the first trading week of the year that will give further information on the state of the economy.

Wednesday is a big day with the Job Openings and Labor Turnover Survey, better known as JOLTS, due out in the morning and the minutes of the Fed’s latest policy meeting set to come out in the afternoon.

They’re also looking forward to Friday’s December jobs report, the final employment report the Fed will have to consider before its next meeting on Feb. 1. There are also several speeches by Fed presidents scheduled Thursday and Friday.

Buffalo defensive back Damar Hamlin was in critical condition early Tuesday after the Bills say his heart stopped following a tackle during the Monday Night Football game, which was indefinitely postponed.

Hamlin collapsed on the field during the first quarter of the nationally televised game against the Cincinnati Bengals and was given medical treatment for nearly 20 minutes before being taken to a hospital.

“Damar Hamlin suffered a cardiac arrest following a hit in our game versus the Bengals. His heartbeat was restored on the field and he was transferred to the UC Medical Center for further testing and treatment,” the Bills said in a statement. “He is currently sedated and listed in critical condition.”

Jordon Rooney, a family representative who described himself as a good friend of the player, told ABC’s “Good Morning America” on Tuesday that Hamlin’s relatives are in good spirits but going through a lot and need their privacy. He declined to give details on Hamlin’s condition other than to say he is sedated.

“All I can say is he’s fighting; he’s a fighter,” Rooney said.

In a chilling scene, Hamlin was administered CPR on the field, ESPN reported, while surrounded by teammates, some of them in tears, while they shielded him from public view. He was hurt while tackling Bengals receiver Tee Higgins on a seemingly routine play that didn’t appear unusually violent.

The NFL announced Hamlin’s condition shortly after he was taken to a hospital, but neither the league nor the hospital released any other details about the 24-year-old’s medical condition. The team’s statement was released before its flight arrived back in Buffalo early Tuesday. There was no immediate update about the future status of the game.

On the play the 6-foot, 200-pound Hamlin was injured, Higgins led with his right shoulder, which hit the defensive back in the chest. Hamlin then wrapped his arms around Higgins’ shoulders and helmet to drag him down. Hamlin quickly got to his feet, appeared to adjust his face mask with his right hand and then fell backward about three seconds later and lay motionless.

Hamlin was treated on the field by team and independent medical personnel and local paramedics, and he was taken by ambulance to University of Cincinnati Medical Center. Teammate Stefon Diggs later joined Hamlin at the hospital.

About 100 Bills fans and a few Bengals fans gathered on a corner one block from the emergency room entrance, some of them holding candles.

Jeff Miller, an NFL executive vice president, told reporters on a conference call early Tuesday that the league had made no plans at this time to play the game, adding that Hamlin’s health was the main focus.

An ambulance was on the field four minutes after Hamlin collapsed while many players embraced, including quarterbacks Buffalo’s Josh Allen and Cincinnati’s Joe Burrow.

“Please pray for our brother,” Allen tweeted.

Hamlin collapsed at 8:55 p.m., and when he was taken off the field about 19 minutes later in what seemed like an eternity, the Bills gathered in prayer. A few minutes after the ambulance left the field, the game was suspended, and players walked off the field slowly and into their locker rooms where they awaited word on Hamlin and the game.

“I’ve never seen anything like it since I was playing,” NFL executive Troy Vincent, a six-time Pro Bowl cornerback during his career, said in the conference call early Tuesday. “Immediately, my player hat went on, like, how do you resume playing after seeing a traumatic event in front of you?”

Hamlin’s uniform was cut off as he was attended to by medical personnel. ESPN reported on its telecast that Hamlin was also given oxygen.

Vincent said the league took no steps toward restarting the game and did not ask players to begin a five-minute warmup period as ESPN’s broadcasters had announced.

“It never crossed our mind to talk about warming up to resume play,” Vincent said. “That’s ridiculous. That’s insensitive. That’s not a place we should ever be in.”

Vincent said the Bills were returning early Tuesday morning to the team facility in Orchard Park, New York, with the exception of a few players who stayed behind with Hamlin.

There was a heavy police presence at Buffalo Niagara International Airport when the team arrived at about 2:45 a.m. A small group of fans gathered across the street from the players’ parking area near the airport. Police blocked off the road to allow the players to leave.

The Bengals led 7-3 in the first quarter of a game between teams vying for the top playoff seed in the AFC. Cincinnati entered at 11-4 and leading the AFC North by one game over Baltimore, while AFC East champion Buffalo was 12-3.

“The NFLPA and everyone in our community is praying for Damar Hamlin,” the players’ union said in a statement. “We have been in touch with Bills and Bengals players, and with the NFL. The only thing that matters at this moment is Damar’s health and well being.”

The unfinished game has major playoff implications as the NFL enters the final week of the regular season, with the wild-card playoff round scheduled to begin on Jan. 14.

The aftermath of the injury was reminiscent of when Bills tight end Kevin Everett lay motionless on the field after making a tackle on the second-half opening kickoff in Buffalo’s 2007 season-opening game against the Denver Broncos.

Everett sustained a spinal cord injury that initially left him partially paralyzed.

Hamlin spent five years of college at Pittsburgh — his hometown — and appeared in 48 games for the Panthers over that span. He was a second-team All-ACC performer as a senior, was voted a team captain and was picked to play in the Senior Bowl.

He was drafted in the sixth round by the Bills in 2021, played in 14 games as a rookie and then became a starter this year once Micah Hyde was lost for the season to injury.

By late Monday night, a community toy drive organized by Hamlin had surged to more than $1.2 million in donations. His stated goal was $2,500.

Kathryn Bersani and her mother, Gayle, were among the Bills fans who traveled from Buffalo for the game and went to the hospital from the stadium.

“This is our family Christmas,” Kathryn Bersani said. “We thought it would be a great game. Joe (Burrow) and Josh (Allen) are such great men. Sad, sad time. Such a shock. I just hope he can live a normal life. It stunned us.”

Chuck and Janet Kohl went to the hospital after watching the game at home.

“This is much more important than football,” Chuck Kohl said. “Had to come and pray for Mr. Hamlin.”

Entering the game, Hamlin had 91 tackles, including 63 solo tackles, and 1 1/2 sacks.

A tweet from the Pitt football account was simple and clear: “Damar Hamlin is the best of us. We love you, 3,” the tweet said, referring to Hamlin by his college jersey number. “Praying for you.”

Foxconn’s Covid-hit iPhone plant in China’s Zhengzhou city is almost back to full production, with its December shipments reaching about 90% of initial plans, two people with direct knowledge of the matter said.

Foxconn, formally Hon Hai Precision Industry, declined to comment.

Production at the world’s largest manufacturing facility of Apple’s iPhones was heavily affected late last year after a Covid-19 outbreak and curbs taken to control the virus prompted thousands of workers to leave. It was also hit by a bout of worker unrest over payment issues.

Foxconn has been offering bonuses to attract new workers and convince those still there to stay on. A company source told Reuters last month that it was aiming for the plant to resume full production around late December to early January.

“Production has almost fully resumed,” said one of the people on Tuesday, who declined to be identified as the information was private.

The second person said production was nearly back to normal but that company officials remained cautious over the outlook due to a spike of Covid-19 cases across China.

“We expect a peak for cases before or after the Lunar New Year holiday,” the person said, referring to the week-long break that starts on Jan 21. “We don’t know if that will cause any issues.”

On Saturday, the government-owned broadcaster of Henan province, where the plant is located, quoted an executive from the factory as saying that the plant’s workforce was currently stable at 200,000 staff and that it had also stabilized its supply chain, enabling production capacity to recover.

The plant is able to accommodate as many as 300,000 workers.

The Zhengzhou plant’s troubles highlighted the difficulties companies and workers had in adhering to China’s zero-Covid-19 policy.

The central government in early December, after Foxconn’s woes and a string of protests over the policy, abruptly dropped the policy to adopt a strategy of living with the virus. The move was greeted by widespread relief but has also precipitated a wave of infections across the country.