Gap’s massive job cuts will save $300 million

This article is relatively short, and the title pretty much tells it all. Gap plans to lay off 1,800 employees in the coming weeks, after just cutting 500 other jobs in September. 

The company has been struggling with bad partnerships, loss of their CEO, and a drop in stock of 23%

GAP, and other recent company's who have been making job cuts, hoping that they will be able to invest their salaries to increase investment. However, if all company's are doing this at once, investment aside, consumers who have lost their jobs, and there are many, - 168,243 people so far in the tech sector alone- will experience a decrease in their discretionary income and this will decrease their spending on said companies. 

https://www.cnn.com/2023/04/27/business/gap-layoffs-corporate/index.html  

Huge gaps between American and Japanese interest rates offer opportunities

 Following Warren Buffett's announcement that he wants to own more of the stocks of three of Japan's top five trading conglomerates, their shares have recently risen to record highs.  Since Mr. Buffett's investment company, Berkshire Hathaway, announced its initial purchases on his 90th birthday in 2020, Itochu, Marubeni, Mitsui, Mitsubishi, and Sumitomo Corporation have seen a significant increase in value. Since then, the price of their shares has increased from 64% to 202%.

The yen presently trades for 134 to the dollar, but investors have the chance to sell at 127 to the dollar for currency futures that mature in March of the following year. That guarantees a 5% return for a little under a year. The only expense is that the buyer must keep yen for the entire time. The benefit of hedging is essentially an added bonus for buyers who want to acquire Japanese stocks.  Many economists anticipate a significant increase in Japanese rates, even if the Bank of Japan abandons its yield-curve control policy.

Big names are starting to fly over the Pacific. An activist investor, Elliott Management, has benefited from its intervention in Dai Nippon Printing. The company's stock has increased by 46% so far this year. American hedge company Citadel is reportedly reopening an office in Tokyo after a 15-year absence. The example of Mr. Buffett and other major figures of American finance might attract a little more attention after a time in which the Japanese market has subtly produced respectable returns.

https://www.economist.com/finance-and-economics/2023/04/20/warren-buffett-is-shaking-japans-magic-money-tree

Sharp economic slowdown triggers new recession fears

 Early in 2023, the US economy saw a significant slowdown, with an annual growth rate of 1.1% as opposed to 2.6% in the previous quarter. New recession fears have been raised as a result of this, but experts disagree on whether one will actually occur. Some forecast a slight recession, while others claim one could be avoided entirely. The future of the nation's economy is anticipated to be significantly impacted by the Federal Reserve's interest rate increases.

In 2020, the US economy went through a Covid-19 recession, but it has since recovered thanks to significant job growth and low unemployment rates. Americans are confident in their ability to spend despite a slowdown in wage growth. The labor market has contributed to the emergence of a "rolling recession," in which different sectors of the economy experience alternating contractions and sluggish but positive growth. Layoffs are a lagging indicator, so if the economy deteriorates, there could be a significant rise in unemployment.

During the pandemic, the US government invested $5 trillion in the economy, adding an additional $2.3 trillion to bank accounts that made it easier for families to survive despite high inflation. The fiscal stimulus kept the economy booming and prevented a recession, but economists warn that the summer will see a run-out of excess savings. The good times may be coming to an end as evidence suggests that Americans are cutting back on their purchases of goods like cars, appliances, clothing, and furniture.

However, Americans are now spending money on experiences like dining out, travel, sporting events, and concerts. Spending has increased significantly in the leisure and entertainment industry, which includes bars, restaurants, and movie theaters. To keep up with demand, hotels, museums, and theaters have been hiring quickly. Even though this has kept the economy growing, there are signs that families are reevaluating their spending patterns. Travel agents are reporting slowdowns in demand, and data from restaurant reservation platform Open Table shows a steady decline in the number of people dining out compared to a year ago.

Despite the ongoing pandemic and the war in Russia and Ukraine, the world economy has performed better than expected. A mild winter in Europe helped keep rising energy prices in check, and other significant economies in Asia and Europe have proven resilient. China's economy has recovered remarkably quickly since it relaxed its zero-covid policies. The International Monetary Fund revised its earlier estimate of global growth from 2.7 percent to 2.9 percent in January. The fate of the world economy, according to the IMF, is "uncertain again" as a result of the recent banking turmoil and persistent inflation, which has caused them to reevaluate that optimistic outlook. The IMF now projects 2.8 percent overall growth for this year.

In conclusion, there are new concerns about an impending recession as the US economy has begun to show signs of a significant slowdown. The Federal Reserve's interest rate increases are anticipated to be extremely important for the nation's economic future, despite the fact that experts are divided on whether they will occur. Americans have reduced their spending on goods, but they have increased their spending on experiences, which is keeping the economy strong. There are signs that families are reconsidering their spending patterns, though. As a result of ongoing inflation and financial instability, the future of the global economy is once again uncertain. These elements are clouding the picture and casting doubt on the direction of the economy.

Source: https://www.washingtonpost.com/business/2023/04/27/recession-gdp-slow-economy/

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Wages and Prices Slow Unevenly, Reflecting ‘Rocky and Bumpy’ Economy

"Consumer prices were up 4.2 percent in March from a year earlier, according to the Fed’s preferred measure of inflation, the Personal Consumption Expenditures index, the Commerce Department said Friday. That was the slowest pace of inflation in nearly two years, down from a peak of 7 percent last summer." This makes it seem like inflation may be stabilizing.

Wages, meanwhile, continue to rise rapidly good news for workers trying to keep up with the rising cost of living, but a likely source of concern for the Fed. The Fed has been raising interest rates as well for more than a year in an effort to cool off the economy and bring inflation down to the central bank’s target of 2 percent per year. Higher interest rates have already taken a toll on housing, manufacturing and business investment.

On the one hand, rising wages can be seen as a positive development for workers who are trying to keep up with the rising cost of living. On the other hand, the Fed may view this as a potential source of concern, as higher wages can contribute to inflationary pressures in the economy.

https://www.nytimes.com/2023/04/28/business/economy/inflation-fed-wages-prices.html

Greenwood expects to see boost in business from 2023 Masters Tournament

 “Greenwood usually sees around a million-dollar economic impact between the lodging and the hospitality and the restaurants, so we always enjoy having visitors here this week, and we appreciate all the support they provide for our community," 

I find it very interesting that an outside states economy and this specific city, Greenwood is able to benefit from a neighboring tournament. Obviously the masters is one of the biggest events every year in sports. Although for a city one million dollars isn't life changing for a place, you can't complain.

I'd be curious to see if any other neighboring places or if there are any other places that are passed through that help bump the economy. I know specifically for Augusta "An estimated 200,000 people will travel to Augusta and provide $120 million to the local economy" according to Substack. 

https://www.wyff4.com/article/greenwood-masters-golf-business-south-carolina/43510216 

Southwest Airline Hiring Plan Changes

    Southwest Airlines, one of the largest low-cost carriers in the United States, has announced that it will be scaling back its hiring plans for 2023 due to delays in receiving its orders of Boeing aircraft. The airline initially planned to hire over 5,000 new employees in 2023, but now expects to hire a small percent of that. This is because the company is awaiting the delivery of new Boeing 737 MAX jets. Boeing has faced many production and delivery delays leading to reduced supply of the planes.

    In response to the delays, Southwest has adjusted its hiring plans for 2023, as the airline will now only be able to hire a smaller number due to the reduced fleet growth. Southwest's Chief Financial Officer, Tammy Romo, explained that the airline is disappointed to have to adjust plans.

    Southwest remains optimistic, with plans to expand its operations and invest in new technologies that will improve the travel experience for its customers. However, the delays in receiving its Boeing orders continue to remind us of the challenges that continue in the wake of the pandemic, as supply chain were disrupted, we had labor shortages, and other unforeseen obstacles had to be overcome.

The Banking Crisis is Having a Slow-burn Impact on the Economy

 The  banking crisis that began just a few months ago is seeming to have differing effects from what we originally thought. It appears that it may be a slow bleed that trickles through the economy and acts as a catalyst to the recession that everyone has been predicting. The current consensus is that large banks have not seen major implications yet while smaller banks are taking most of the hits. This is an issue because if smaller banks are now lending less this is a hit on middle America which is a negative for overall economic growth. 

The immediate future does seem to look good as first quarter GDP growth is predicted to be 2% or more. However this is not expected to last as the Fed continues to spike interest rates and small banks begin to lend less. This decline is seen in the $563 billion drawdown this year among US banks.

The good news is that any recession on the horizon is likely going to be brief and the banking crisis appears to have been confined. Many different reports have said that the crisis is not as serious as it was originally perceived to be with the Federal Reserve’s “Beige Book” saying demand for loans “generally declined”. The chief economist at Moody’s Analytics also said “The fallout from the crisis seems less serious than I had expected just a few weeks ago.”  While a recession is thought to be short-lived, the direction of the economy is now up to the consumers.

Source - https://www.cnbc.com/2023/04/25/the-banking-crisis-is-having-a-slow-burn-impact-on-the-economy.html

Bill Gates is the Largest Landowner in the U.S.

 Only over the span of a few years, starting slightly after the global pandemic, Bill Gates began to buy up 270,000 acres of farmland in the U.S with most of it consisting in northeastern North Dakota. North Dakota small family farms are being bought out by large conglomerates...whether that be nation states (China), large corporations (seed and pharma companies), or big money trusts similar to what Gates used to buy up much of northeastern ND. 

Next we discuss Gates motive. According to about a 1/3 of the articles available on google, many of the sources explain that Gates is only doing it for investment purposes. They explain that many wealthy individuals in America buy real estate agriculture trust funds, or other agriculture investment tools that produce robust returns (after government subsidies). However, other sources say Gates is innovating new way to produce food for Americans. It is considered to be a new field of research for the future in which they are creating synthetic beef, plants, and GMO products. Gates motive for synthetic beef is for the reduction of green house gases and a new wave for climate change management. This is simply not true. 

Corporate farms, CAFOs, and large seed and pharmaceutical companies own the rights to the land and gmo's (seeds) in much of agricultural America today. They use mono-agricultural practices that need pesticides, herbicides, and soil degradation which taints our food, kills our soil, and creates vast amounts of C02 carbon emissions during tilling season (March and April). 

The future of agriculture is no longer in the hands of the American people, but in the hands of large corporatocracies and policy-makers. If Gates was so worried about our future food crisis and feeding the world, the farms would remain in local farmers hands. Large operation farms are tearing away the frugality of the soil and plants, while regenerative farming practices by small family-owned farms are able to create sustainable, diverse, and carbon-sequestering farmland that will produce nutrient dense foods that do not need any "cides" to keep them alive during grow season. 

Stay weary of those who control our food supply. "He who controls the food supply, controls the people" -Henry Kissinger

https://www.popularmechanics.com/science/environment/a42543527/why-is-bill-gates-buying-so-much-farmland/

How Oakland's Economy and Community will be affected by the Athletics heading to Vegas

 As MLB attendance reached an all time low, many teams are forced to think about their future, and how to draw in more fans. One of the teams in focus has been the Oakland Athletics, with their performance and attendance struggling for a few years now. It was just recently announced that the A's will be heading to Vegas in a surprising move. They had originally said they were staying in Oakland, all the while they were working on a deal with Las Vegas.

The question then becomes, how will the A's departure affect its economy? It will be a "shot in the arm" as said by Alameda County Board of Supervisor President. He mentioned that there were many jobs in the ballpark, and if they were able to build a new one that would be even more jobs. But, these jobs will be lost as The Athletics move. Oakland will be losing yet another team, after already losing the Golden State Warriors and the now Las Vegas Raiders. 

They say the A's are a huge part of their community, and their loss will be felt. Oakland is still trying to be positive amid the unfortunate news about their team and keep developing and celebrating their city. Oakland still has a few professional sports teams, but only time will tell if these teams follow the A's and pursue opportunities elsewhere.

https://abc7news.com/athletics-news-as-moving-to-vegas-oakland-las-economic-impact/13161848/

The Federal Reserve Board Fines Well Fargo $67.8 Million

        In 2015 it was revealed that Wells Fargo had been creating fake deposit and credit accounts under customer’s names without their knowledge or consent. Specifically, it was reported that Wells Fargo had created a total of 2.1 million fake accounts (later amended to 3.5 million in 2017). Ever since this incident consumer trust in Wells Fargo has deteriorated over years. Most recently, the Federal Reserve Board fined Wells Fargo $67.8 million for overly risky practices regarding oversight of its subsidiary banks. Wells Fargo’s lack of oversight enabled foreign banks to process approximately $532 million in transactions between 2010 to 2015, which is a direct violation of U.S. sanctions regulations. The U.S. Department of the Treasury’s Office of Foreign Asset Control will also be imposing its own separate fine on Wells Fargo. Along with the Federal Reserve board, the total fine is estimated to be around $97.8 million. 

Article: https://www.federalreserve.gov/newsevents/pressreleases/enforcement20230330a.htm