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Stock futures are little changed as investors look ahead to Friday's jobs report

January 6, 2023 Published by

Bond prices surge, yields fall as economic data signals cooling inflation

Bond prices rallied with stocks, sending yields down, after two key economic reports signaled inflation my be cooling off as the Fed raises interest rates.

The yield on the benchmark 10-year Treasury was down by 16.2 basis points at 3.56%. The 2-year Treasury yield fell 18.9 basis points to 4.264%. The yield on the 30-year Treasury was down 11.8 basis points at 3.68%.

Yields and prices move in opposite directions. One basis point equals 0.01%.

—Carmen Reinicke

Stocks making the biggest moves midday

Check out the companies making headlines in midday trading.

  • World Wrestling Entertainment — The wrestling entertainment stock surged 21% after WWE announced that founder Vince McMahon is returning to its board of directors and that the company is exploring strategic moves. McMahon stepped down as CEO last year after an investigation into sexual misconduct, but has remained majority shareholder. The Wall Street Journal reported that McMahon is returning to pursue a potential sale of the business.
  • R1 RCM — Shares of the healthcare technology firm soared more than 11% after the company raised its revenue outlook for 2023. The company also reaffirmed its projection for full-year 2022.
  • Costco Wholesale — Shares of the big-box retailer jumped more than 6% after it reported solid sales numbers for December. Costco posted net sales of $23.8 billion in December 2022, marking an increase of 7% year-over-year. Evercore ISI also added Costco to its “fab five” list, saying it’s a defensive stalwart.

Read the full list here.

— Sarah Min

First week of year signals volatility ahead for stocks, Goldman Sachs says

Investors may not want to get too excited about Friday’s rally.

“This first week of 2023 (and January) has come with the usual raft of major economic data points which on net point to the unusual post-pandemic era combination of a resilient labor market set against eroding business sentiment across the economy,” analysts at Goldman Sachs wrote in a Friday note. “Even as Corporate America continues to hire over 200,000 net new workers a month and post over 10mn job openings, both the Manufacturing and Service sector feels like things are getting worse.”

Of course, things getting worse is relative to one of the best GDP expansions the U.S. has seen, according to the note. This was partially fueled by pandemic stimulus through 2021.

“But this unusual combination we are now seeing of slow growth, high inflation, and elevated stock market valuations is likely to make for an uneven trading landscape in the year ahead,” Goldman said. That’s likely to mean modest returns for stocks this year.

—Carmen Reinicke

Tesla reverses slump, trades higher

Tesla reversed a more than 5% slump Friday following news that the electric vehicle maker would lower prices on some models of cars in China.

Later in the day, however, Tesla rose with the broader market. It was up 1.85% at midday.

Fed’s Barkin says rate hikes can be done ‘more deliberately’ now

Richmond Federal Reserve President Thomas Barkin said Friday the central bank has to keep working to bring down inflation but can do so with a little less intensity.

“We still have work to do,” the central bank official said in prepared remarks. “Inflation is too high, and we will need to stay on the case until it is sustainably back to our 2% target. We have forecasted additional rate increases this year.”

Policymakers indicated in December that they’re likely to take rates up another percentage point or so before pausing. Atlanta Fed President Raphael Bostic earlier in the day told CNBC he expects the central bank’s benchmark funds rate rising past 5%, from its current 4.25%-4.5% target range.

Barking did not specify how high he thinks the rate should go. However, he said the Fed now can move “more deliberately” after raising rates aggressively seven times in 2022.

—Jeff Cox

Health care, hospitality lead December job gains

Health care and social services was the top category for job growth in December, followed by leisure and hospitality, as the U.S. labor market continues to show strength despite the Federal Reserve’s aggressive rate hikes.

Meanwhile, two sectors that had been struggling in recent months — retail and transportation and warehousing — snapped back to growth in December.

Bank of America downgrades Chevron as oil prices cool

As oil prices cool, Bank of America is expecting Chevron won’t outperform as much as it did in 2022.

The firm expects a modest 9% upside after gaining more than 50% in share value last year. Analyst Doug Leggate also downgraded the stock to neutral from buy, citing limited upside as oil prices stabilize following the jump prompted by Russia’s invasion of Ukraine.

“Put simply we see CVX as a victim of its own success – but with <10% upside to our estimate of fair value, we believe the appropriate rating vs North American peers is Neutral,” Leggate said in a note to clients Friday.

CNBC Pro subscribers can read more about Leggate’s call here.

— Alex Harring

Goldman’s Hatzius says jobs numbers consistent with ‘soft landing’

December’s employment report helps add to the narrative that the U.S. may be able to avoid a recession, Goldman Sachs chief economist Jan Hatzius said Friday.

“We’re growing at a below-trend pace that’s necessary to rebalance the economy. Wage growth is gradually decelerating, price inflation is pretty quickly decelerating,” Hatzius said on CNBC’s “Squawk of the Street.” “I think that should be encouraging for a soft landing.”

He spoke after the Labor Department reported a 223,000 increase in nonfarm payrolls and a 4.6% annual rise in average hourly earnings, the slowest pace for the latter metric since August 2021.

—Jeff Cox

Wells Fargo upgrades Lululemon

Wells Fargo analyst Ike Boruchow upgraded shares of Lululemon to overweight, calling the athletics apparel retailer a “rare name with momentum.”

“LULU’s top-line resilience in the past few years has been nothing short of stunning, with 2022E’s topline expected to be essentially double 2019 levels,” he said, expecting continued resilience in 2023.

CNBC Pro subscribers can read the full story here.

— Samantha Subin

Stocks typically rebound massively following big yearly losses

History shows that the stock market typically rebounds drastically following a year of big losses, according to S&P Dow Jones Indices.

Since 1936, of the nine prior years with double-digit losses, seven of those years experienced double-digit gains the following year (an average of 18%), according to the firm. The S&P 500 lost 19.4% in 2022, suffering its worst year since 2008.

Stocks rally on slower wage growth but are ignoring other message in jobs data

The December jobs report shows the economy is still adding jobs at a strong rate, but investors focused on the fact that wage growth is slowing, suggesting inflation may be ebbing.

Stocks rallied after the 8:30 a.m. ET employment report showed 223,000 jobs were created in December. Average hourly wages grew at an annual pace of 4.6%, less than the 5% expected by economists.

“The big move was the fact that average hourly earnings came in lower than expected. That suggests that investors are focused intently on inflation, and whether that inflation is moving toward the Fed’s target,” said Michael Arone, chief investment strategist at State Street Global Advisors.

But he also cautioned that the data could be double-edged, since it suggests the economy and employment are still strong. That could help keep inflation elevated and keep the Fed hiking more than markets might expect.

The Fed next meets Jan. 31 and Feb. 1. While some economists anticipate a half point hike after that meeting, traders in the futures market put greater odds on a smaller, 25 basis point hike. A basis point equals 0.01 of a percentage point.

“Data like today suggests the Fed could do 50 basis points,” said Arone. A more aggressive Fed could create more market volatility.

The Fed has been trying to slow the economy and the hot labor market through its rate hiking, which has taken the fed funds target rate range to 4.25% to 4.50%.

 Peter Boockvar, chief investment officer at Bleakley Financial Group said market expectations did not change after the jobs report, and the fed funds futures contract for February was pricing in another 32 basis points of hikes.

“It’s pricing 100% chance of a 25 basis point hike, and a 30% chance for an additional 25. Peak fed funds is still at 5%” for July, he said. “The market is still expecting the Fed to go another 60, almost 70 basis points,” he said. Boockvar said the end point for the Fed matters more than if it raises by 25 basis points or 50 when it next meets.

–Patti Domm

KeyBanc says Bed Bath & Beyond shares can fall to 10 cents amid bankruptcy warning

KeyBanc is expecting shares of Bed Bath & Beyond to fall to 10 cents as the beaten down retailer warns it could seek bankruptcy protection.

Analyst Bradley Thomas reiterated his underweight rating on shares, while slashing his price target to 10 cents from $2. That implies 94% downside from Thursday’s close.

Read more on the call from KeyBanc here.

— Samantha Subin

Services sector contracted in December, ISM survey shows

The services sector contracted in December amid a pullback in new orders and production, the Institute for Supply Management reported Friday.

The ISM Services index fell to 49.6% for the month, well below the Dow Jones estimate for a 55.1% reading. The gauge measures the percentage of businesses reporting expansion, with a reading below 50% indicating contraction.

New orders fell 10.8 percentage point while business activity and production dropped 10 points. Prices fell 2.4 points to 67.6%, still a high number but representative of some softening in inflation. Employment also fell, moving down 1.7 points to 49.8% and into contraction territory.

—Jeff Cox

Morgan Stanley says banks’ 4Q results hit by higher loan loss reserves and expenses

Jane Fraser speaks during the Milken Institute Global Conference in Beverly Hills, California, U.S., on Monday, April 29, 2019.

Kyle Grillot | Bloomberg via Getty Images

Banks reporting fourth-quarter results next week will miss earnings estimates because they’ll need to plow money into loan loss reserves ahead of an expected downturn, according to Morgan Stanley analysts led by Betsy Graseck.

The companies will likely “incorporate a more severe economic outlook” into their scenarios for loan defaults this year, forcing them to set aside more than expected in reserves, Graseck wrote in a note published Friday.

On top of that, banks are likely to disclose bigger-than-expected increases to 2023 expense guidance because of wage inflation, Graseck wrote. She expects the median big bank to guide to about 4% expense growth, above the consensus of 3%.

Her pessimistic view on banks is shared by Deutsche Bank analyst Matt O’Connor, who cut his recommendation on Bank of America and JPMorgan Chase shares to hold from buy on Friday.

For her part, Graseck cut her price targets for Goldman Sachs and Citigroup shares by 7.3% and 8.9% respectively, thanks in part to her thesis.

On the other hand, she favors Wells Fargo, JPMorgan and Northern Trust heading into earnings because each bank could surprise to the upside on revenue and expenses, Graseck wrote.

—Hugh Son

Tesla falls to fresh 2-year low

Tesla shares reached their lowest level in about two years Friday after the electric car maker cut its Model 3 and Model Y vehicles. The stock traded 5.6% lower, dragging down the Nasdaq Composite.

Jobs report boosted expectations for soft landing, but recession clock is ticking, Shah says

Investors cheered Friday’s jobs report as signaling that a soft landing – a scenario in which the Federal Reserve tames inflation but doesn’t push the economy into a recession – is more likely.

“A lower unemployment rate and weaker average hourly earnings growth is certainly going to get equity market bulls’ attention,” Seema Shah, chief global strategist at Principal Asset Management said in a Friday note. “Indeed, expectations for a soft landing in the economy have likely been boosted in light of today’s jobs report.”

Still, investors may not want to cheer the news too much as it likely won’t change the Fed’s actions in the coming months.

“Yet, with the unemployment rate back to the historic low of 3.5%, how realistic is it to expect wage growth to move meaningfully lower? The Fed will likely be skeptical,” she said. “And so, with the record low unemployment rate indicating that there is still so much work ahead of them, Fed policy rates are set to rise above 5% within just a few months and a hard landing looks to be the most likely outcome this year. The recession clock is ticking.”

—Carmen Reinicke

Stocks open higher after better than expected jobs report

U.S. stocks opened higher Friday after investors cheered the December jobs report, which showed the labor market remains resilient but that wages aren’t gaining as much as expected amid the Fed’s interest rate hikes to tame inflation.

The Dow Jones Industrial Average increased 255 points, or 0.77%. The S&P 500 gained 0.68%, while the Nasdaq Composite jumped 0.44%.

—Carmen Reinicke

Wages improve but jobs report keeps Fed on track to raise rates

Wage growth in December was less than the 5% annual pace expected by economists, but it should not influence the Federal Reserve’s rate hiking path when it meets in February.

Some economists expect the Fed will raise rates by a half percentage point, while traders in the futures market have been betting on a quarter point hike.

“This is steady as she goes for the Fed. There’s no reason to stop raising rates at this time,” said Diane Swonk, chief economist at KPMG. “They still have wages growing at 4.6%, which is above the 3% to 4% they think is necessary to bring inflation down to their 2% target. The trend is the right direction for the Fed. Average hours worked continued to tick down.”

The economy added 223,000 jobs in December, more than the 200,000 expected by economists. Average hourly wages increased 0.3% on a monthly basis.

“We’ve got 4.5 million new pay checks for the year. That’s the second strongest year on record,” said Swonk. She said 2022 was second to 2021, when there were 6.7 million jobs created. “The only thing close was 1946 when soldiers returned to civilian work after World War II.”

December jobs report should add investor confusion, market volatility

Investors are so far cheering the December jobs report, which showed wage gains may have moderated, signaling progress in the fight against high inflation. Still, it’s likely to lead to choppy markets.

“While the easing of wage pressures may initially be cheered by markets, workers are still not keeping up with inflation, therefore pressuring consumption trends,” said John Lynch, Chief Investment Officer for Comerica Wealth Management.

“This report should add to investor confusion and heighten market volatility in the weeks ahead,” he added. “It also complicates the Fed’s battle against inflation, though the minutes from the December monetary policy meeting reiterate the committee’s resolve.”

“A 50-basis point move is back on the table for the next FOMC meeting in a few weeks,” he said.

—Carmen Reinicke

U.S. economy adds more jobs than expected in December

The U.S. economy added 223,000 jobs last month, slightly more than a Dow Jones consensus forecast for a 200,000 gain. This is yet another sign that the economy remains strong even as the Federal Reserve tries to tame inflation through higher rates. However, wages grew at a slightly slower-than-expected pace, increasing 0.3% versus an estimate of 0.4%.

— Fred Imbert

Stocks making the biggest premarket moves

Southwest projects fourth-quarter loss after mass flight cancelations

Last month’s operational meltdown was a costly one for Southwest, the airline said Friday.

The airline released guidance for its fourth quarter results that projected a net loss for the period, due in part to charges of between $725 million and $825 million from flight cancelations. Between $400 million and $425 million was lost revenue from the flights, while the rest comes from reimbursements to customers, premium pay to employees and other factors.

Shares of Southwest were down 2.7% in premarket trading.

— Jesse Pound

Citi downgrades U.S. equities, saying valuations are expensive

Citi has cut its rating on U.S. equities to underweight heading into the new year, partially due to the dollar’s strength waning.

“We are no longer dollar bulls, which helped keep us Overweight in 2022,” Robert Buckland wrote in a Friday note. “Valuations remain expensive compared to elsewhere.”

He also noted that earnings expectations look too optimistic, especially given the 2023 recession that Citi economists are forecasting.

He also downgraded Japan, noting that it “remains a highly cyclical stock market and is vulnerable to an appreciation in the yen.”

—Carmen Reinicke

JPMorgan downgrades Silvergate Capital

JPMorgan downgraded crypto bank Silvergate Capital, citing concern around the company’s huge fourth-quarter withdrawals.

“While the challenging backdrop for the crypto settlement business was a factor in the worse than expected results being released, we also believe that concerns voiced by short-sellers (on Twitter) likely also contributed to Silvergate’s customers withdrawing deposits from the platform at a greater than anticipated level,” JPMorgan said. “The implications to the company’s business from the significant reduction in client deposits has near- as well as longer-term impacts,” 

Shares fell more than 15% in the premarket after plunging more than 40% on Thursday.

— Sam Subin

Tesla shares fall after EV maker cuts China prices again

Tesla fell 5% in the premarket after the Elon Musk-led company lowered prices for its Model 3 and Model Y vehicles in China. The EV maker said the cars would now be priced at 229,900 yuan (about $33,374) and 259,900 yuan, respectively.

Reuters calculations show these prices are 13%-24% from four months ago. Tesla had lowered prices in October in an effort to prop up sales against rivals in China such as BYD.

— Fred Imbert, Jihye Lee

Deutsche Bank downgrades Bank of America and JPMorgan Chase

Deutsche Bank analyst Matt O’Connor downgraded Bank of America and JPMorgan Chase to hold from buy, citing a weakening macro outlook.

“In some ways, it’s tempting to get more positive given stocks are already down sharply, inflation seems to be slowing and Fed rate hikes may be coming to an end,” he said. “But our gut is that stocks will set new lows and fully (or close to it) price in a US recession suggesting there’s more risk from here.”

CNBC Pro subscribers can read more here.

— Sam Subin

European markets mixed ahead of key euro zone inflation data

European markets were cautious on Friday morning ahead of key inflation data for the euro zone, which is expected to show a further slowdown in consumer price increases.

The pan-European Stoxx 600 index hovered just above the flatline in early trade, with basic resources adding 1.2% while utilities fell 0.4%.

Flash euro zone consumer price index inflation figures are due late morning. After France, Germany and Italy all reported better-than-expected slowdowns over the course of the week, investors are hopeful that inflation has passed its peak across the 20-member common currency bloc.

WWE shares rise in extended trading

— Rebecca Picciotto, Sarah Min

Leon Cooperman says new bull market isn’t coming anytime soon

Billionaire investor Leon Cooperman said he’s still holding a cautious view on stocks and the economy, but he’s finding cheap stocks to buy after the recent correction.

“I would basically take the position that we’re in a market of stocks rather than a stock market,” Cooperman said on CNBC’s “Closing Bell Overtime” Thursday. “I think anybody looking for a new bull market anytime soon is looking the wrong way.”

CNBC Pro subscribers can read the full story here.

— Yun Li

Where the major averages stand this week

Stocks are set to close out the first trading week of the year with losses. As of Thursday’s close, here are where the major averages stand:

  • The Dow Jones Industrial Average is down 0.66% week to date, on pace for its fourth negative week in five.
  • The S&P is down 0.82% week to date, on pace for its fifth negative week in a row for the first time since its 7-week streak ending 5/20/2022.
  • The NASDAQ is down 1.54% week to date, on pace for its fifth negative week in a row for the first time since its 7-week streak ending 5/20/2022.   

— Chris Hayes, Sarah Min

Stock futures open higher

U.S. stock futures opened higher Thursday night after the major averages declined on the back of strong jobs data that could point to further rate hikes, and as investors looked ahead to the December jobs report Friday.

Dow Jones Industrial Average futures rose by 21 points, or 0.06%. S&P 500 and Nasdaq 100 futures climbed 0.13% and 0.19%, respectively.

— Sarah Min

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8 Easy, Dietitian-Approved Snacks That Give You a Jolt of Long-Lasting Energy (and You Can Buy Them All Online)

January 6, 2023 Published by

Well+Good 

From shorter days to fewer hours of sunlight, winter solstice signals a period of darkness and frigid temperatures (brrr). Thanks to the shorter days and dimmer conditions, our circadian rhythms are thrown off balance, making us feel more sluggish than usual (that’s right—it’s not just you). That’s because “when it’s dark, the body produces more melatonin, making us feel sleepy and tired,” says Alyssa Wilson, RDN, MS, LS, a registered dietitian and metabolic health coach for Signos based in Memphis, Tennessee. Whether you’re feeling slumped, or your stomach is growling, energy-boosting snacks are the perfect mood and energy pick-me-up.

When making your way to the snack aisles, Rachel Engelhart, RD, LPC, a registered dietitian and certified intuitive eating counselor based in Washington, DC, recommends munchies rich in protein, fat, and fiber—which tend to have more staying power (meaning your appetite will be satisfied for longer) and prevent your glucose levels from spiraling. “This means that you avoid the sugar spike and subsequent crash that can lead to feeling lethargic and cranky shortly after eating,” she says. Instead of sugary snacks, opt for fresh fruits and veggies. For healthy fats, Alli Magier, MS, RDN, LDN, a registered dietitian, says to go for nuts and seeds.

From no-frills dry roasted almond packs to chicken sriracha bars for on-the-go eats, keep reading to find the best energy-boosting snacks that’ll help you overcome the winter sleepies.

Best energy-boosting snacks

Emerald, Variety Pack (Pack of 18) — $16.00

This nut variety pack comes recommended by Wilson. This trio features dry roasted almonds, unsalted almonds and walnuts, and roasted cashews. Each pack offers 100 calories, 3 grams of protein, and a pinch of fiber. Snack on a pack of these for an afternoon pick-me-up.


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Seapoint, Dry Roasted Edamame — $15.00

Another recommendation from Wilson, these dry roasted edamame are crunchy and offer some tasty bites. Each serving boasts 130 calories to give you a jolt of energy while being filling thanks to the whopping 14 grams of protein. It’s also a good source of potassium and iron—which has benefits for your immune system, muscles, and overall health. Seriously, you won’t stop chewing.


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FAGE, Total 2% Milkfat Plain Greek Yogurt — $2.00

Yogurt is another great way to lift your spirits, and this one is rich in 15 grams of protein and 180 milligrams of calcium. According to Wilson, protein is more filling and keeps you satisfied for longer, so you’ll have enough energy throughout the day. “Pair with some berries and sliced almonds,” recommends Wilson.


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Epic, Chicken Sriracha Bar (Pack of 4) — $8.00

For a no-frills bite, you can’t go wrong with a bar, and this chicken sriracha bar is as tasty as it sounds. Each bar has 100 calories and 11 grams of protein per serving that will give you a jolt in lasting energy. Within each bite, enjoy a spicy kick. Since each bar is individually wrapped, you can grab a bar from the pantry and go.


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Applegate, Uncured Turkey Pepperoni — $7.00

For the meat lovers, Brittany Lara, RDN, LDN, an Illinois-based long-term care dietitian, recommends these turkey pepperoni bites. Without the dough, pizza sauce, and sleepiness, these pepperoni bites are the perfect snack for anyone craving pizza. Each bite-sized turkey meat features 10 grams of protein, 188 milligrams of potassium, and a whole lot of yummy-ness.


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Good and Gather, Antioxidant Trail Mix — $7.00

You can’t go wrong with trail mix, and Lara recommends this pack from Good and Gather. Dried cranberries, almonds, dried blueberries, and dark chocolate chips—uhh…yum! Not only is this mixture tasty, it’s packed with antioxidants, vitamin E, and potassium.


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Mini Babybel, Original Cheese Snack — $12.00

For a hearty snack—minus the sugar spike—Engelhart says to opt for cheese. These individually-wrapped Mini Babybels offer a good source of calories (70) and protein (5 grams). Pair them with seed-filled crackers and turkey pepperoni for extra yum.

Option: Get a 6-pack on Amazon Fresh.


Shop Now

Bumble Bee, Salmon Salad Kit — $4.00

Salmon is a great source of protein and omega-3 fatty acids, and you can load up on all these health-promoting benefits with Bumble Bee’s Salmon Salad Kit. Featuring a can of salmon salad and crackers, this kit makes the ideal snack for days you’re feeling slumped. Take a bite and let the mood boosting commence!

If you’re ready to commit, and want that Prime delivery, get it on Amazon for $21.


Shop Now

Want to be the first to hear about the latest (and greatest) SHOP product drops, custom collections, discounts, and more? Sign up to have the intel delivered straight to your inbox.

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The Lagonda Rapide Had An Aston DB5 Heart, But An Edsel’s Face

January 6, 2023 Published by

Carscoops 

Aston Martin has had a few goes at relaunching the Lagonda brand since the two became bedfellows in 1948, most famously with the wedgy, William Towns-designed Aston Martin Lagonda of the late 1970s and 1980s, and most recently with the 2015 Lagonda Taraf and an aborted electric luxury sedan project axed in 2021.

But less well-known is the Lagonda Rapide built in tiny numbers between 1961 and 1964. Only 55 cars were constructed, each built to order and loosely based on the contemporary DB4 coupe, but incorporating mechanical features that would appear on the DB5 and DBS models later that same decade. They included a 4.0-liter engine in place of the 3.7-liter inline six fitted to the DB4, and a de-Dion rear axle instead of the low-tech live rear axle 007 had to make do with.

Like the DB4, the Rapide was built around a Superleggera tubular steel frame and clothed in lightweight aluminum panels, but the 114-in (2,896-mm) wheelbase (versus 98-in / 2,489 mm for the DB4) meant the back seats were no longer torture devices. And they didn’t need to be because the front end had the torture thing covered.

Related: Ford’s Edsel Project Wins a Place in Forbes Top 10 Business Blunders Ever

To be fair, most cars would come off worst in a beauty contest when sharing the catwalk with a DB4 or DB5. And I actually like the then-fashionable sloping quad-light setup, a design later seen on the Ferrari 330 GT, Gordon-Keeble coupe, and some Mulliner Park Ward Rolls Royce Silver Clouds. There’s no doubt the Rapide has a mean look and some serious presence. But then we get to the grille, which reminds most people of the 1958 Ford Edsel, though with its central fin, a pair of headlights on either side, and another air intake below each of those, it also looks more than a little like a BMW M4, had such a thing existed 60 years ago.

Whatever your thoughts on the styling, it’s certainly an interesting and very cool car, and this one, currently being auctioned on Bonhams’ The Market website has covered only 75,006 miles if the odometer is to be believed. Originally Caribbean Blue Pearl, it’s now metallic gold and is in need of recommissioning after spending the last 15 years as a static exhibit in the Middle East. Would you take a Rapide over a Mercedes SEL 6.3?

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Bureaucrats are profiting off of policy: Only voters can stop them

January 6, 2023 Published by

Just In | The Hill 

Over the past several months, the Wall Street Journal has been reporting on government officials who profit from their cozy relations with the private businesses they regulate or that otherwise fall within their jurisdictions.

As reported on Dec. 30, most of the officials’ personal financial gains arise from “insider trading,” the presumptively illegal buying or selling of publicly traded stock based on not-yet-public information about pending regulatory intervention to which the market will respond (either positively or negatively) after the action is announced. Bureaucrats and politicians are poster child “insiders” who know what public policies are being devised and can easily predict their effects on company profitability.

In 2021, for example, the Federal Deposit Insurance Corporation initiated a process to select its primary provider of cloud data storage services. Microsoft was one of the vendors being considered. According to the Journal, “three key officials involved in the discussions, or their family members, owned shares in Microsoft, including the deputy chief information officer who pushed to pick the company.” Lo and behold, Microsoft was chosen and the insiders, along with all other owners, saw an uptick in the company’s stock price, which they could cash in on immediately by selling their shares. 

The Journal reports similar stories from the Export-Import Bank, Federal Communications Commission and U.S. Patent and Trademark Office. Disclosure and conflict-of-interest rules are in place to limit officials’ ability to profit from their regulatory or policymaking powers. 

The story notes, “Federal prosecutors rarely pursue potential violations, however, leaving enforcement mostly to the agencies themselves. The agencies seldom impose punishments for financial conflicts.”

The lack of prosecutorial zeal is explained in part by the difficulty of enforcing laws against insider trading when it is suspected, whether in the private or public sphere. It can be discovered only if the insider buys shares ahead of an anticipated stock price rise or sells ahead of an expected decline. If advance knowledge of a business-friendly policy action causes the price of a company’s stock to rise, penalties are avoided even if insider information triggers a decision not to sell shares previously in the investor’s portfolio.

Conflicts of interest between public officials and the companies within their policy domains are inescapable. As mentioned, the conflicts can be financial if public officials take advantage of information not yet available to other stock-market participants. Or they can materialize in the longer term through the “revolving doors” between government agencies and the private sector. The knowledge and experience necessary to navigate and exploit public-policy processes are valuable to private businesses, who for that reason regularly offer jobs to former public officials as lobbyists, employees of “governmental affairs” departments or well-paid members of their boards of directors.

Economist and Nobel laureate George Stigler launched scholarly literature in 1971 that has since come to be known as the “capture theory” of regulation or a more general interest-group theory of government. The theory features analyses of rules governing over-the-road trucking, stock brokerage, commercial airlines and public electric utilities — most of which originated during the 1930s, and were justified as necessary to protect consumers from the high prices and substandard products thought (usually erroneously) to be coupled with the pursuit of private profits. 

But the evidence adduced by Stigler and the many scholars who followed his lead pointed in the opposite direction: Public regulation results in prices and profits that are higher than they would be under competitive market conditions. Regulation protects producers, not consumers. That conclusion is obvious to anyone who witnessed the consequences of the brief era of deregulation in the late 1970s and early 1980s.

Stigler explained that private businesses obviously have strong financial stakes in public policy processes, while the interests of consumers and taxpayers, who ultimately bear the costs of policy decisions, are much more diffuse. Producers therefore “capture” the policy process through their lobbying efforts, which shape governmental interventions in their own favor. In fact, private business interests often seek regulation to gain protection from competitive market forces.

Public officials also benefit personally from exercising their authority in ways that selectively help or hurt private business interests, like Microsoft. Just-retired Dr. Anthony Fauci made $1.7 million from his governmental position in 2020 alone, which includes profits from investments. Members of Congress profited from selling defense company stocks, many after voting in favor of sending billions in weapons to Ukraine. One can call such behavior corrupt, unethical or crony capitalism, but it is the predictable consequence of the explosive growth in the size and scope of the administrative state over the past century. 

Remedies may be found at the Supreme Court (e.g., West Virginia et al. v. EPA) or in a revival of federalism. Ultimately, however, only the voters can stop political elites’ financial wrongdoing. 

When asked what kind of government had been created in Philadelphia in 1787, Ben Franklin famously replied: “A republic, if you can keep it.”

William F. Shughart II, research director and senior fellow of the Independent Institute (Oakland, Calif.), is J. Fish Smith Professor in Public Choice at Utah State University’s Huntsman School of Business.

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Here's what people with long Covid need to know about navigating health insurance

January 6, 2023 Published by

Halfpoint Images | Moment | Getty Images

Navigating the health insurance system is often difficult and overwhelming, even in the best of times. For patients with long Covid, a relatively new condition that frequently leaves patients with a lengthy and unpredictable list of debilitating symptoms, it can be especially nightmarish.

“Even if you remain on the same [health insurance] plan you had before Covid, you will probably utilize the health-care system more, whether it be more office visits, more prescription medications or even more medical devices,” said Caitlin Donovan, a spokesperson for the National Patient Advocate Foundation.

Indeed, nearly half of people with long Covid reported increased medical expenses, according to a recent survey conducted by the Patient Advocate Foundation. The nonprofit, NPAF’s sister organization, polled 64 people with the condition between 2020 and 2022. Meanwhile, 13% of respondents in the PAF survey said they’d experienced changes to their health-care coverage as a result of long Covid.

More from Your Health, Your Money

Here’s a look at more stories on the complexities and implications of long Covid:

In all, one Harvard University researcher estimated that long Covid could leave patients with an extra $9,000 a year in medical expenses.

Here’s what you need to know about navigating health insurance with the condition.

Unemployed long Covid patients have coverage options

Between 2 million and 4 million full-time workers are out of the labor force due to long Covid, according to recent research from the Brookings Institution.

If long Covid causes you to lose or leave your job and, therefore, your employer-sponsored health insurance, don’t panic. You may have several options for getting new coverage, said Karen Pollitz, a senior fellow at the Kaiser Family Foundation.

There are resources you can turn to for help deciding the best route to getting reinsured. If you have a diagnosed condition, including long Covid, you may be able to get support deciding on and enrolling in a plan with the Patient Advocate Foundation.

At no charge, you can also consult with a local health-care “navigator,” an expert who can help you search insurance plans and enroll in one on the Affordable Care Act’s marketplace.

1. Join a family member’s plan

Losing your job-based coverage triggers a 30-day special enrollment opportunity to join a family member’s plan, Pollitz said. You might consider getting covered through your spouse’s employer or a parent’s, if you’re under 26.

2. Extend workplace coverage

If your former company had at least 20 employees, you might also have the option to get insured through the Consolidated Omnibus Budget Reconciliation Act, or COBRA, Pollitz said.

COBRA typically allows people who leave a company to remain on their workplace insurance plan for up to 18 months — although it’s not cheap. (It tends to be pricey because you pick up the part of the health insurance tab your former company was covering.)

There are exceptions that can stretch coverage. If the Social Security Administration considers you disabled (long Covid can qualify as a disability), you may be able to stay on COBRA for an additional 11 months. Those who qualify for Medicare around the time they part with a company may also qualify for an extension beyond the typical 18 months.

3. See if you qualify for Medicaid

If your job loss has left your household with a substantially lower income, you may be able to enroll in Medicaid, Pollitz said. “This is comprehensive public coverage with no monthly premium,” she said. Eligibility is based on your current income, Pollitz added, and you can sign up year-round.

If you’re receiving disability benefits from a private insurer and/or through your employer, that income won’t necessarily disqualify you for Medicaid; you’ll want to check whether or not the payments are subject to taxes.

“If the benefits are taxable as income, then they would count toward Medicaid eligibility,” Pollitz said.

Even if you remain on the same plan you had before Covid, you will probably utilize the health-care system more.

Caitlin Donovan

spokesperson at the Patient Advocate Foundation

4. Sign up for a plan on the public exchange

Long Covid patients who have recently become unemployed may also be able to get health insurance on the Affordable Care Act’s marketplace. Losing your job triggers a 60-day enrollment period on the marketplace, where many of the plans are subsidized.

“Fortunately, ACA insurers are not allowed to discriminate based on health,” said Jonathan Gruber, a professor at the Massachusetts Institute of Technology and a former director of the health-care program at the National Bureau of Economic Research. “So having long Covid will not raise costs.”

5. Explore Medicare eligibility

Lastly, if you end up qualifying for Social Security Disability Insurance because of your long Covid, you may become eligible for Medicare, even if you’re younger than 65, after a two-year waiting period.

If you’re already 65 or older when you lose your job, Medicare may be your best option for coverage, Donovan said.

“Medicare comes with the benefit of an almost universal network, in contrast to marketplace plans,” Donovan said, adding that delaying enrollment once you’re eligible can also subject you to financial penalties.

Employed patients ought to review benefits

If your case of long Covid hasn’t disrupted your employment and you remain insured at work, you’ll want to make sure you’re signed up in a robust plan, Donovan said.

A more comprehensive workplace plan typically comes with a higher monthly premium but lower out-of-pocket expenses and more options, Donovan said. It’s especially important, she added, that you get the most generous prescription drug plan, if your company offers a variety of them.

Educate yourself as much as you can about your coverage, Donovan said, including information on providers and treatments that you might formerly not have considered.

Long Covid patients, for example, often seek physical therapy and mental health services, she said.

You’ll also want to make sure you’re up to date on your employer’s paid time off and sick days policy.

Clinical trials are ‘worth investigating’

Clinical trials, many of which are covered by health insurance plans, can be a great option for long Covid patients, Donovan said.

“Long Covid is still new, so anyone who participates in a clinical trial will be contributing to our understanding of the condition and advancing our ability to treat it,” she said.

Why long Covid could cost the U.S. nearly $4 trillion

And, she added, “clinical trial participants may have access to the newest safe and effective treatments.”

Trials take place all over the country, and some are even virtual, Donovan said. People can find out more at clinicaltrials.gov and by talking to their doctor.

Keep in mind, Donovan said, that your health insurance plan may require any trials be in-network and it may only cover certain costs of the experience.

Still, Donovan said, “it’s worth investigating.”

Meanwhile, those looking to save money on prescription costs should ask about generic options, which tend to be cheaper than the brand-name medicines.

In addition, Donovan said, programs like GoodRx may help you cut costs on certain drugs. And the Patient Advocate Foundation has a charitable copay program to which those struggling financially can apply.

Finally, Donovan said, with so much still unknown about long Covid, insurers may be more likely to reject coverage for a particular treatment or service. Patients should fight back, she said.

“Don’t lose hope,” Donovan said. “Go through the appeal process: Over 40% of denials are overturned in the patient’s favor.”

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China's big cities are starting to look past Covid, while rural areas brace for infections

January 6, 2023 Published by

Subway passenger traffic in Shanghai is quickly returning to levels seen before the latest Covid wave, according to Wind data. Pictured here is a subway car in the city on Jan. 4, 2023.

Hugo Hu | Getty Images News | Getty Images

BEIJING — China will likely be able to live with Covid-19 by the end of March, based on how quickly people have returned to the streets, said Larry Hu, chief China economist at Macquarie.

Subway and road data show traffic in major cities is rebounding, he pointed out, indicating the worst of the latest Covid wave has passed.

“The dramatic U-turn in China’s Covid policy since mid-Nov implies deeper short-term economic contraction but faster reopening and recovery,” Hu said in a report Wednesday. “The economy could see a strong recovery in Spring.”

In the last several days, the southern city of Guangzhou and the tourist destination of Sanya said they’d passed the peak of the Covid wave.

Chongqing municipal health authorities said Tuesday that daily visitors to major fever clinics was just over 3,000 — down sharply from Dec. 16 when the number of patients received topped 30,000. The province-level region has a population of about 32 million.

Stock market could catch tailwind from China ending 'zero-Covid,' says Hightower's Link

Chongqing was the most congested city in mainland China during Thursday morning’s rush hour, according to Baidu traffic data. The figures showed increased traffic from a week ago across Beijing, Shanghai, Guangzhou and other major cities.

As of Wednesday, subway ridership in Beijing, Shanghai and Guangzhou had climbed significantly from the lows of the last few weeks — but had only recovered to about two-thirds of last year’s levels, according to Wind Information.

Caixin’s monthly survey of services businesses in December found they were the most optimistic they’d been in about a year-and-a-half, according to a release Thursday. The seasonally adjusted business activity index rose to 48 in December, up from a six-month low of 46.7 in November.

That below-50 reading still indicates a contraction in business activity. The index for a separate Caixin survey of manufacturers edged down to 49 in December, from 49.4 in November. Their optimism was the highest in ten months.

Poorer, rural areas next

Shanghai medical researchers projected in a study that the latest Covid wave would pass through major Chinese cities by the end of 2022, while rural areas — and more distant provinces in central and western China — would be hit by infections in mid- to late-January.

“The duration and magnitude of upcoming outbreak could be dramatically enhanced by the extensive travels during the Spring Festival (January 21, 2023),” the researchers said in a paper published in late December by Frontiers of Medicine, a journal sponsored by China’s Ministry of Education.

Typically hundreds of millions of people travel during the holiday, also known as the Lunar New Year.

The researchers said senior citizens, especially those with underlying health conditions, in China’s remote areas face a greater risk of severe illness from the highly transmissible omicron variant. The authors were particularly worried about the lack of medicine and intensive care units in the the countryside.

Even before the pandemic, China’s public health system was stretched. People from across the country often traveled to crowded hospitals in the capital city of Beijing in order to get better health care than they could in their hometowns.

Oxford Economics senior economist Louise Loo remained cautious about a rapid rebound in China’s economy.

“A normalisation in economic activity will take some time, requiring among other things a change in public perceptions towards contracting Covid and vaccine effectiveness,” Loo said in a report Wednesday.

The firm expects China’s GDP will grow by 4.2% in 2023.

Lingering long-term risk

The medical researchers also warned of the risk that omicron outbreaks on the mainland “might appear in multiple waves,” with new surges in infections possible in late 2023. “The importance of regular monitoring of circulating SARS-CoV-2 sublineages and variants across China shall not be overestimated in the months and years to come.”

However, amid a lack of timely information, the World Health Organization said Wednesday it was asking China for “more rapid, regular, reliable data on hospitalizations and deaths, as well as more comprehensive, real-time viral sequencing.”

China in early December abruptly ended many of its stringent Covid controls that had restricted business and social activity. On Sunday, the country is set to formally end a quarantine requirement for inbound travelers, while restoring the ability of Chinese citizens to travel abroad for leisure. The country imposed strict border controls beginning in March 2020 in an attempt to contain Covid domestically.

Why China shows no sign of backing away from its 'zero-Covid' strategy

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[World] McDonald’s leaves Kazakhstan over supply shortages

January 6, 2023 Published by

BBC News world 

Reuters

McDonalds has blamed “supply issues” on its reason for pulling out of Kazakhstan
By Kathryn Armstrong
BBC News

McDonald’s has closed its restaurants in Kazakhstan due to supply shortages.

The fast food company has not elaborated on what has caused the scarcity, but it is thought to be due to supply issues linked to Russia’s invasion of Ukraine.

McDonald’s is thought to have banned its local franchisee from procuring burgers from Russian suppliers.

The chain’s Kazakh operator, Food Solutions KZ, said it would reopen its branches under a new brand.

In the capital, Alamaty, workers were seen removing the large white lettering from the front of one of the branches.

Neighbouring Russia is Kazakhstan’s main trading partner but after Moscow invaded Ukraine on 24 February, it was hit with a raft of international sanctions. Kazakhstan agreed to comply with these.

As a result, many Kazakh businesses have faced supply problems.

According to Reuters, quoting a source close to Food Solutions KZ, the sanctions and the withdrawal of McDonald’s from Russia in May prompted the company to start looking for suppliers elsewhere and to stop buying Russian products.

However, this has proven difficult and McDonald’s announced in November that it was “temporarily” suspending its operations in Kazakhstan over supply issues. They now look to have closed for good.

Speaking at a meeting with the government on 12 December, Food Solutions KZ’s head, Aset Mashanov, said efforts were being made to source meat products locally in order to restart its operations as soon as possible.

He also indicated that sourcing produce from abroad would be difficult if customs clearance and other red tape was not simplified.

In a statement, McDonald’s confirmed its agreement with Food Solutions KZ had been terminated but did not give details why.

McDonald’s first began operating in Kazakhstan in 2016, eventually opening restaurants in 24 cities and employing roughly 2,000 people.

 

​Read More 

JetBlue Wants to Capitalize on Southwest's Woes

January 6, 2023 Published by

As soon as the Halloween candy is put away, every industry in the world starts its holiday sales, offering discounts on pretty much any consumer item you can think of.

But the people who truly live for savings (i.e., the type of people who really clean up on shows like “Extreme Couponing,”) know that the real savings occur in January when stores are trying to unload the stock that didn’t move.

The airline industry doesn’t quite operate on the same principles. While a department store will want to clear out inventory to make room for the impending Spring goods, airlines don’t have that sort of concern. Instead, the airline industry has a bit of a post-holiday slump to deal with.


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Michigan AG reopens probe into Trump’s false 2020 electors

January 6, 2023 Published by

Just In | The Hill 

Michigan Attorney General Dana Nessel (D) is reopening her investigation into the false electors in the state who signed a certificate claiming that former President Trump won the state in the 2020 presidential election. 

The Detroit News reported that Nessel said during a press call with the Democratic Attorneys General Association on Friday that the release of witness testimony and the final report from the House select committee that investigated the Jan. 6, 2021, insurrection provided “clear evidence” to support charges against the 16 fake electors who tried to overturn President Biden’s victory in the state. 

Nessel previously referred the case to federal prosecutors, saying last January that they were in a better position to look into what seemed to be a coordinated multi-state effort. 

But she said Friday that she was worried that a year has passed since then and was not sure what the federal government is going to do. 

“I think that type of activity can’t go without any consequences,” she said. 

The group of Republicans reportedly met at Michigan GOP headquarters on Dec. 14, 2020, to sign the certificate. 

Nessel has said that the electors might have violated a Michigan law against forgery of a public record and election-related forgery. 

The certificate claimed that the electors gathered in the state Capitol, but they did not, according to The Detroit News. Some reportedly walked to the Capitol after the meeting at Republican headquarters but were not allowed to enter. 

Republicans have accused Nessel of having political motivation behind the investigation, The Detroit News reported.

​State Watch, 2020 presidential election, Dana Nessel, Donald Trump, fake electors, Michigan Read More 

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