Business week: start in style
Happy July 4th. Between strong job growth in June, rising consumer confidence and a record stock market, there is much to be said for in the economy. So fire up the grill, watch the fireworks and enjoy the long holiday weekend. – Charlotte Cowles
What’s up? (June 27-July 3)
June job rally
Hires jumped in June as employers added 850,000 workers, according to the latest employment report. This is the biggest gain in 10 months and an encouraging sign that the labor market recovery is picking up steam after uneven growth earlier this year. Consumer confidence is also at its core highest point since the start of the pandemic, and stocks closed the first half of the year at record highs. The Congressional Budget Office said the economy is on track to recover all the jobs lost in the pandemic by the middle of next year.
Raise the temperature
The Trump Organization has been accused of implementing a 15-year program to help its leaders avoid taxes by offsetting them with non-accounting benefits. Allen H. Weisselberg, longtime CFO and loyal to former President Donald J. Trump, faces 15 felony counts, including charges of robbery and tax evasion. Mr. Trump has not been named in the charges, but they could harm him financially and lay the groundwork for further investigations into his business dealings.
The Robinhood stock trading app, which has built up a large (and notoriously unpredictable) base of amateur traders, has revealed details of its finances for the first time as it prepares for its much-anticipated IPO. His documents showed a surge in income last year, followed by significant losses in the first quarter of 2021 as he grappled with the meme stockpile frenzy. As part of its mission to make stocks more accessible to as many people as possible, Robinhood plans to allow its clients to participate in its initial public offering at the listing price before public negotiation – a benefit that companies typically do not offer. than private investors. The company also agreed to pay a fine of $ 70 million (the largest ever imposed by the Financial Industry Regulatory Authority) for misleading its clients about how it made money from their transactions and harming to their bottom line with service outages.
And after? (July 4-10)
Amazon demanded that Lina Khan, the new chairman of the Federal Trade Commission, be barred from any antitrust investigation into the company, citing unfair bias. Ms Khan is a longtime critic of the e-commerce giant’s business practices and has made no secret of it in her academic writing. Amazon is currently the subject of an FTC investigation as well as investigations by state attorneys general. If Ms Khan plays a role in these proceedings, Amazon says it would violate federal ethics rules and the company’s due process rights.
In an embarrassing setback for federal regulators’ efforts to dismantle Facebook, a judge dismissed the U.S. government’s lawsuit against the social media platform last week. The judge’s reasoning: Regulators have failed to adequately prove that Facebook has a dominant share of the social media market. But he left the door open for the Federal Trade Commission to resubmit his case – presumably after arguing his case – within the next 30 days.
Fight for 15
Global taxation is not an exciting topic, but it has turned out to be much more popular than expected. Last week, 130 countries and jurisdictions approved setting a minimum corporate tax rate of 15%. The deal is remarkable (and surprising) because it includes China, Russia and India – large economies that are generally wary of tax crackdowns that could scare businesses away. Originally proposed by the United States, the deal would also require tech giants like Amazon and Facebook to pay taxes in countries where their goods or services are sold, even if they are not physically there. present. Ministers from the Group of 20 major economies will work out more details on the deal over the coming week.
Almost 19% of all offices in Manhattan have no tenants – the highest on record – as companies abandon leases and embrace remote working. Hertz emerged from bankruptcy just in time to capitalize on a booming car rental market and a resurgent travel industry. And Jeff Bezos will be officially replaced by his deputy, Andy Jassy, as general manager of Amazon this week.