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Crossing guards say driverless cars nearly hit them in crosswalks 2024-06-11 21:00:00+00:00 - In San Francisco, one of the nation’s largest testing grounds for driverless vehicles, some school crossing guards say they have had to rush out of crosswalks to avoid being hit by self-driving cars. “I just don’t think it’s very safe,” said Theresa Dorn, a school crossing guard for 11 years. Dorn says driverless vehicles operated by Waymo, which was spun off from Google in 2016, have nearly struck her on three separate occasions over the past year while she was guiding children and their families along crosswalks. “The parent grabbed the child, looked at the car, and there was nobody driving it,” she said. NBC News and NBC Bay Area interviewed 30 crossing guards stationed at more than 20 schools across San Francisco. Nearly 25%, about 1 in 4, said they had experienced some type of “close call” in the crosswalk with a Waymo driverless car, where either the vehicle suddenly hit the brakes to prevent a collision, or the crossing guard rushed out of the way to avoid being hit. “It did not recognize me in the intersection,” said Dorn, who added that each of her near misses occurred while she was holding up her stop sign in the crosswalk. “Why do they have these driverless cars?” she said. “I think somebody should be driving them.” Theresa Dorn, a San Francisco crossing guard of 11 years, says she's nearly been hit by driverless cars three times over the past year. Michael Horn / NBC News Waymo said that without specific details, such as the time and date of the incidents, it couldn’t explain what its cars may have done or why. The company declined to be interviewed, but in a statement said it takes public concerns “very seriously,” adding “while we’re proud of our safety record, we also recognize the importance of ensuring that other road users feel confident and comfortable around our technology.” Crossing guards describe 'close calls' Of the 30 crossing guards interviewed, all but Dorn spoke on the condition of anonymity since they, unlike Dorn, did not have permission from their employer, the San Francisco Municipal Transportation Agency, to speak publicly. “I’ve almost been hit half a dozen times,” one crossing guard told us. “I tell kids to stay back,” said another. The close calls all occurred within the past year, those guards reporting them said, but they could not recall exact dates or times. None of them filed police reports about their near misses. Waymo has been shuttling passengers with its autonomous cars since 2017, when it launched its ride-hailing service in Phoenix. The company has since dispatched driverless fleets to San Francisco, Los Angeles and Austin, Texas. “We want to be good members of the communities we operate in and appreciate the ongoing dialogue we have with the other road users and regulators,” Waymo said in its statement. A paper trail of near misses Calculating the exact number of near misses involving driverless cars is impossible because the companies operating them are only legally required to disclose actual collisions. The California Department of Motor Vehicles and the National Highway Traffic Safety Administration (NHTSA) each maintain separate records regarding accidents reported by autonomous vehicle companies; those databases, however, do not include records involving near misses. While driverless car companies are allowed to keep their close calls secret, there is a partial paper trail. Through a public records request, NBC News and NBC Bay Area obtained all autonomous vehicle complaints submitted last year to the California Department of Motor Vehicles, one of the state’s major regulators overseeing autonomous vehicles. In 2023, the DMV fielded more than 200 complaints regarding driverless cars — roughly a quarter involved Waymo and the bulk of the rest concerning its competitor, Cruise, a subsidiary of General Motors. About 30% of those complaints detailed safety concerns in crosswalks. Of those 62 complaints, nearly all included descriptions from people saying driverless cars nearly struck them in crosswalks. “I’ve almost been hit,” said one complainant, recalling an incident with a Waymo driverless car. “We had to hit the car with our hand before it stopped,” wrote another, referring to a Cruise autonomous vehicle in a crosswalk. Crossing guards at different schools across San Francisco share similar stories about almost being hit by driverless cars. Bigad Shaban / NBC News Cruise, like Waymo, also declined an interview request, but in a statement said safety is a “critical priority,” adding that its cars are “designed to detect, track and predict the behavior of road users, including pedestrians and cyclists.” Cruise, which noted each of its vehicles are equipped with 360-degree cameras to “measure distances to objects and maintain visibility,” also said that it has a “dedicated team that investigates concerns ... and the insights gathered help our [autonomous vehicles] improve.” Up until late last year, Cruise was offering driverless rides in San Francisco, Phoenix, Austin and Dallas, but the company pulled its entire fleet of roughly 400 self-driving vehicles off the road last October amid accusations from California regulators that Cruise’s cars posed an “unreasonable risk to public safety.” Those comments stemmed from an incident in San Francisco in which a pedestrian was struck by a human driver, tossing her into the path of a driverless Cruise car, which ran her over and then immediately came to a stop. Regulators with the California DMV and California Public Utilities Commission have accused Cruise of misleading them into thinking that is where the incident ended. Both agencies said they later learned that shortly after stopping, the Cruise vehicle then attempted to pull over to the curb, dragging the pedestrian about 20 feet after failing to recognize she was trapped underneath the vehicle. Cruise, which is the subject of at least five separate investigations — by the California DMV and Public Utilities Commission, the National Highway Traffic Safety Administration, the U.S. Department of Justice and U.S. Securities and Exchange Commission — has repeatedly denied attempting to “purposely” mislead anyone, but company executives have acknowledged Cruise committed a series of “regrettable” missteps. Most of the crossing guards interviewed said they had not encountered a close call with a driverless car, and some said they consistently found self-driving vehicles to be better drivers than humans. One crossing guard said, “I’ve almost been hit by parents, not driverless cars.” Autonomous vehicles have logged more than 70 million miles on public roadways across the U.S. and have been tested or operated in at least 19 states, according to the Autonomous Vehicle Industry Association. Proponents of autonomous cars argue that they have the potential to prevent human-caused accidents. In California, 35 companies are permitted to operate driverless vehicles in neighborhoods across the state. Most of those firms are still only approved to use their driverless cars for ongoing testing, but hundreds of autonomous vehicles in California are already being used commercially for ride-hailing services and food delivery. Regardless of whether a human is behind the wheel, vehicles are still expected to follow the rules of the road. For example, cars must wait to drive through a crosswalk until all pedestrians are completely out of it, according to the California Highway Patrol. However, in cases where a concrete median separates both directions of traffic, cars are free to pass once pedestrians have cleared that side of the street. NBC News’ previous reporting, however, has raised questions about how often driverless cars are complying, including when small children are involved. Call for more oversight State lawmakers in California as well as members of Congress are now echoing calls to enact more stringent reporting requirements for driverless car companies. “Those kinds of incidents where people’s lives are put at risk — but it’s not reportable — we need to be looking at those,” said U.S. Rep. Kevin Mullin, D-Calif. “The data is crucial in crafting regulations that compel these companies to focus on these areas of safety concern.” In April, Mullin sent a letter to NHTSA formally requesting that the agency begin forcing driverless car companies to reveal how often their vehicles are involved in near misses, not just collisions. “You’ve identified some pretty discernible patterns,” Mullin said in reference to NBC News’ findings, which he called “concerning.” “I will share what you found with my colleagues in Washington to see how we can use this information to keep pressure where we need to apply it.” Rep. Kevin Mullin, D-Calif., is asking federal transportation officials to bolster national reporting requirements for driverless car companies, so that they would be required to disclose all "close calls" involving their vehicles. NBC News Officials with NHTSA said they are still in the process of drafting a response to Mullin’s letter and had no comment on the request. The agency, however, did note that it is actively working on six safety investigations into driverless car companies — one launched last October and another two months later involve Cruise. One of the agency’s newest investigations, however, centers on Waymo, which focuses on more than 30 incidents in which Waymo driverless vehicles were either involved in a collision or “potentially violated traffic safety laws.” “NHTSA plays a very important role in road safety and we will continue to work with them as part of our mission to become the world’s most trusted driver,” Waymo said in a statement. The company added its driverless vehicles shuttle passengers about 50,000 times per week “in some of the most challenging and complex environments.” Cruise, which also said it is cooperating with the ongoing investigations, noted in a statement it is “deeply committed to safety” and pledged to continue “engaging with regulators and stakeholders at all levels of government to help bring the benefits of autonomous vehicle technology to communities.” While lawmakers, regulators and driverless car companies weigh in on what future requirements and restrictions should look like for autonomous vehicles, Dorn said she will keep her attention focused on her busy San Francisco intersection and the children she is trying to protect. “My main concern is just making sure that they get to school safely and that they go back home safely,” Dorn said. “We have to be a little bit more cautious.”
Johnny Depp says he beat out Tom Hanks, Tom Cruise, and Michael Jackson for the starring role in 'Edward Scissorhands' 2024-06-11 20:58:37+00:00 - By clicking “Sign Up”, you accept our Terms of Service and Privacy Policy . You can opt-out at any time by visiting our Preferences page or by clicking "unsubscribe" at the bottom of the email. Access your favorite topics in a personalized feed while you're on the go. download the app Sign up to get the inside scoop on today’s biggest stories in markets, tech, and business — delivered daily. Read preview Johnny Depp had some stiff competition to land his now-iconic role in Tim Burton's "Edward Scissorhands." In an untitled docuseries on Burton that world premiered at this year's Tribeca Film Festival, Depp, 61, said that Tom Hanks and Michael Jackson were among the stars who contacted Burton to be considered for the title role in the 1990 hit gothic tale about an unfinished artificial teen who has scissor blades for hands. This story is available exclusively to Business Insider subscribers. Become an Insider and start reading now. Related stories Depp said in the docuseries even Tom Cruise "was not far away from actually playing Edward Scissorhands — true story," according to People. At the time Burton — who was coming off hits "Pee-wee's Big Adventure" and "Beetlejuice" — was casting the role, Depp was a teen idol known for his work on the TV show "21 Jump Street." At the time, he thought his chances of landing the role were slim. Advertisement Johnny Depp in 1989. Barry King/WireImage/Getty "He's never going to cast me when everyone in Hollywood is after the part," Depp recalled in the docuseries. "Tim's really juggling because he's getting hit by his agent, the studio, everybody," Depp continued. "So I called my agent after reading the script and said, 'Please cancel the meeting, I'm not going.' She said, 'Are you fucking nuts?'" Depp said he "finally gave in" and agreed to meet Burton, and the rest is history: they started a collaboration that continued for decades with films like 1994's "Ed Wood," 1999's "Sleepy Hallow," the 2005 "Charlie and the Chocolate Factory" remake," and 2010's "Alice in Wonderland."
Scarlett Johansson may testify before Congress about OpenAI debacle 2024-06-11 20:51:17+00:00 - Actor Scarlett Johansson's odd tussle with OpenAI over the voice used for "Sky," its GPT-40 chatbot, may get airtime in Congress after a House subcommittee invited her to testify about it. In a letter sent Monday, Rep. Nancy Mace, R-S.C., asked Johansson to speak at a hearing about deepfake technology held by the House Oversight's Subcommittee on Cybersecurity, Information Technology and Government Innovation on July 9. "You recently expressed concerns via social media about the resemblance between your own voice and that of the 'Sky' chatbot, recently released as part of OpenAI's GPT-40 update," Mace wrote. "This hearing would provide a platform for you to share those concerns with House Members, and to inform the broader public debate concerning deepfakes." According to Axios, Johansson’s team told Mace’s office that she cannot appear at the July 9 hearing but may be available in October. Last month, OpenAI unveiled the latest update to its chatbot with a voice that sounded strikingly similar to Johansson’s. (My colleague Zeeshan Aleem wrote about the apparently deliberate similarities between GPT-40 and the AI character that Johansson voiced in the 2013 sci-fi movie, “Her.”) Days after "Sky" was released, Johansson released a statement saying that she had turned down an offer last year from OpenAI's CEO, Sam Altman, to lend her voice to the chatbot. “Nine months later, my friends, family and the general public all noted how much the newest system named ‘Sky’ sounded like me," she wrote. "When I heard the released demo, I was shocked, angered and in disbelief that Mr. Altman would pursue a voice that sounded so eerily similar to mine that my closest friends and news outlets could not tell the difference." Altman responded in a statement that the chatbot's voice "was never intended to resemble" Johansson's, and The Washington Post later confirmed his claim that the company hired an actress to voice "Sky" months before Altman reached out to Johansson. Still, the controversy raised further questions about AI's potential encroachment on culture and how it may affirm some of our biases. It also spurred wide discussion about AI deepfakes, which are increasingly being used to spread fake sexually explicit videos of female celebrities — and teen girls.
Trump’s company: New Jersey golf club liquor license probe doesn’t apply to ex-president 2024-06-11 20:50:24+00:00 - ATLANTIC CITY, N.J. (AP) — Former president Donald Trump is not the holder of liquor licenses at his three New Jersey golf clubs, his company said Tuesday in response to an inquiry by the New Jersey attorney general’s office into whether his convictions in a New York case might affect those licenses. The Trump Organization issued a statement Tuesday saying the former president is not an officer or director of any entity that holds a liquor license in New Jersey, or anywhere in the United States. The state Attorney General’s office said Monday it is looking into whether Trump’s convictions on 34 counts in a trial involving hush money payments to a porn star and falsification of business records to hide it violates a prohibition on anyone convicted of a crime involving “moral turpitude” from holding a liquor license. “These are some of the most iconic properties in the world, and reports like this do nothing but harm the thousands of hard-working Americans who derive their livelihoods from these spectacular assets,” a company spokeswoman said in an email. According to state alcoholic beverage control records, Trump’s three golf clubs have liquor licenses issued in the name of corporate entities including Lamington Farm Club LLC; Trump National Golf Course Colts Neck LLC, and TNGC Pine Hill LLC. The clubs are located in Bedminster, Colts Neck and Pine Hill. The attorney general’s office declined a request for comment Tuesday on the Trump Organization’s statement or the progress of the office’s inquiry into the liquor licenses. When Trump was sworn in as the 45th president in January 2017, he turned over management of The Trump Organization to his eldest sons, Donald Jr. and Eric, according to a statement on the company’s website.
Biden administration seeks to wipe consumer medical debt off most credit reports with proposed rule 2024-06-11 20:46:35+00:00 - The Biden administration is pushing to prevent medical debt from being considered in most decisions made over whether someone qualifies to rent an apartment, buy a car or take on a mortgage. The Consumer Financial Protection Bureau said Tuesday it is planning a rule that would remove medical bills from credit reports and prevent lenders from making decisions based on medical information. The proposed rule also would prevent lenders from repossessing medical devices like wheelchairs if people cannot repay a loan. “No one should be denied access to economic opportunity simply because they experienced a medical emergency,” Vice President Kamala Harris said during a conference call laying out the planned rule. The administration announced plans for the rule in September, and a senior administration official said they expect to finalize it early next year. The CFPB has said that medical debt can be a poor predictor of whether someone is likely to repay a loan. Those expenses often are not planned like a car or home purchase, and patients may have little control over the progress of a serious illness. CFPB Director Rohit Chopra also noted Tuesday that research shows billing errors frequently appear on credit reports. He said the rule would prevent debt collectors “from using the credit report as a cudgel” to force people to pay bills they may not owe. The three national credit reporting agencies — Experian, Equifax and TransUnion — said last year that they were removing medical collections debt under $500 from U.S. consumer credit reports. But the CFPB said Tuesday that even with that change, 15 million people still have $49 billion in outstanding medical bills in collections appearing in the credit reporting system. The CFPB will take comments or feedback on its proposed rule until August 12. ___ The Associated Press Health and Science Department receives support from the Howard Hughes Medical Institute’s Science and Educational Media Group. The AP is solely responsible for all content.
National Amusements stops discussions with Skydance on Paramount deal, sources say 2024-06-11 20:46:00+00:00 - National Amusements has stopped talks with Skydance on a proposed merger with Paramount Global , CNBC's David Faber reported Tuesday. National Amusements, which is owned by Shari Redstone, the controlling shareholder of Paramount, had previously agreed to terms of a merger with a consortium that includes David Ellison's Skydance, and private equity firms RedBird Capital and KKR. The deal had been awaiting signoff from Redstone, CNBC previously reported. National Amusements, which Redstone controls, owns 77% of class A Paramount shares. Paramount shares closed nearly 8% lower Tuesday following the report. National Amusements said in a statement on Tuesday it has "not been able to reach mutually acceptable terms regarding the potential transaction with Skydance Media for the acquisition of a controlling stake in NAI." "NAI is grateful to Skydance for their months of work in pursuing this potential transaction and looks forward to the ongoing, successful production collaboration between Paramount and Skydance," the statement said. Redstone's company said it "supports the recently announced strategic plan being executed by Paramount's Office of the CEO as well as their ongoing work and that of the Company's Board of Directors to continue to explore opportunities to drive value creation for all Paramount shareholders." Paramount declined to comment. Spokespeople for Skydance and Redbird did not immediately respond to requests for comment. The Wall Street Journal earlier reported talks had ended. It's been a roller coaster in the months since discussions around the potential merger began. The about face on the proposed deal not only comes days after Skydance and Paramount agreed to merger terms, but also after Paramount's annual shareholder meeting, where the company's leadership outlined plans for the future. Last week, Paramount's current leadership, the so-called "Office of the CEO" — CBS CEO George Cheeks, Paramount Media Networks CEO Chris McCarthy and Paramount Pictures CEO Brian Robbins — mapped out the company's strategic priorities in the event the company was not sold. The shared leadership structure was put into place in late April, when former CEO Bob Bakish stepped down. The trio outlined a plan that included exploring streaming joint venture opportunities with other media companies, eliminating $500 million in costs and divesting noncore assets. The plan that was presented to shareholders was Redstone's alternative option if she chose not to sell. While Redstone noted during the beginning of the shareholder presentation the unorthodox structure of the leadership team, she voiced her support. She has approved of their ideas and leadership during their short tenure, CNBC previously reported. Redstone has controlled the future of Paramount and whether a sale would take place. In May, another potential buyer for Paramount surfaced — Apollo Global Management and Sony, which formally expressed interest in acquiring the company for $26 billion, CNBC previously reported. However, Redstone favored a deal that would keep the company together, and Apollo and Sony planned to break up Paramount, separating its movie studio from other parts of the business including its broadcast network, CNBC previously reported. This is why it was no surprise when Paramount and Skydance agreed to merger terms earlier in June, CNBC reported. Under those terms, which were still being ironed out up until Tuesday, Redstone would have received $2 billion for National Amusements, CNBC reported. Skydance would buy nearly 50% of class B Paramount shares at $15 apiece, or $4.5 billion, leaving the holders with equity in the new company. Skydance and RedBird would have also contributed $1.5 billion in cash to help reduce Paramount's debt. The deal with Skydance would have been valued at $8 billion, an increase from the earlier $5 billion offer. The plan outlined by Paramount's three leaders last week emphasized the reduction of debt and getting the company back to an investment-grade rating after it was lowered to junk status earlier this year. Paramount had roughly $14.6 billion in long-term debt as of March 31. — CNBC's Alex Sherman contributed to this article.
I explored an Arizona ghost town with an abandoned dentist's office, schoolhouse, and laundromat. The spot felt like stepping back in time. 2024-06-11 20:43:20+00:00 - On a recent road trip across the American West, I made a stop at The Gold King Mine and Ghost Town. The ghost town is part of the mining town of Haynes, Arizona. Today, visitors can explore an impressive collection of old buildings, antiques, and automobiles. Sign up to get the inside scoop on today’s biggest stories in markets, tech, and business — delivered daily. Read preview Thanks for signing up! Access your favorite topics in a personalized feed while you're on the go. download the app Email address Sign up By clicking “Sign Up”, you accept our Terms of Service and Privacy Policy . You can opt-out at any time by visiting our Preferences page or by clicking "unsubscribe" at the bottom of the email. Advertisement I will never turn down a visit to a ghost town. Whether exploring an abandoned castle in the Australian jungle or opening the door to an old miner's cabin in my home state of Colorado, the deserted destinations feel like traveling back in time. So, on a road trip across the American West in the fall of 2023, I had a few ghost towns I was eager to visit. This story is available exclusively to Business Insider subscribers. Become an Insider and start reading now. Have an account? Log in .
What is a Liquidity Trap? Here's What You Should Know 2024-06-11 20:40:00+00:00 - Too much of a good thing can be dangerous, even in the stock markets. While markets often crave liquidity, especially in times of trouble, too much liquidity can create problems. A liquidity trap is a situation where the tools of central banks lose effectiveness as the money supply grows and demand fails to keep pace. A liquidity trap occurs under specific conditions, making it challenging for policymakers to revive the economy, especially when interest rates are already low. In this article, you will learn why liquidity traps form and how the government responds to them. Get stock market alerts: Sign Up What Causes a Liquidity Trap? A liquidity trap doesn’t occur quickly like a market crash; it slowly builds as the economy responds less and less to monetary policy. Several factors buoy the slow burn of a liquidity trap, but here are the three biggest influences. Persistent Low Inflation Inflation erodes our purchasing power over time, impacting how consumers and businesses spend their money. When inflation is persistently low over extended periods (or even falls into deflation), consumers might put off purchasing high-ticket items since the threat of future price increases is negligible. Low inflation also disincentivizes investment as cash retains value, and businesses and consumers keep money in the bank instead of deploying it. High inflation can destroy wealth, but deflation can grind economic activity to a halt as well. Consumer Expectations Consumers don’t often consider their overall economic influence, but public sentiment and expectations absolutely affect markets. Cash hoarding will increase if consumers expect low rates and low inflation to continue. If economic gloom is the prevailing view, consumers will bulk up savings and put less money into their homes, businesses, and brokerage accounts. It’s a bright idea to save for emergencies, but money isn't circulating through the economy when everyone is saving for a rainy day at once. Central Bank Policies Policymakers themselves can contribute to liquidity traps by flooding the economy with cheap money. Interest rates are the chief lever central banks use to influence the economy. When they want to rein in the economy, they increase interest rates to make capital more expensive. When the economy struggles, rates are lowered to spur lending and borrowing. But what if rates are already at (or near) zero and demand is still tepid? In that scenario, interest rates would be ineffective in restoring growth. Keeping rates low for too long may also fuel future liquidity traps instead of quieting them. How Liquidity Traps Affect Economic Policy Central banks have two primary tools for influencing the economy: interest rates, which we discussed above, and asset-backed strategies like quantitative easing or tightening. When the COVID-19 pandemic kneecapped capital markets, the Federal Reserve dropped rates near zero and added Treasuries to its balance sheet to stimulate activity. Low rates and central bank asset purchases can spur activity, but these aren’t guarantees. When monetary policy lacks the effectiveness to boost the economy, fiscal policy can be supplemented. Fiscal policy refers to intervention from Congress, which comes in the form of spending and taxes. Monetary policy is more of an indirect instrument, while fiscal policy can be expansive and direct. The combination of monetary and fiscal policy aided in the United States' recovery following the COVID-19 pandemic, but it also created massive inflationary pressure, and the Consumer Price Index (CPI) reached a four-decade high in the years following the government response. Liquidity traps highlight the economy's constantly evolving status. Low rates can boost consumers and markets, but if left unchecked for too long, they can cause slowdowns and deflation. Getting economic policy “just right” is a complicated and ever-changing goal, and even the best policy responses can have aftereffects that are either unexpected or take years to materialize. Historical Examples of Liquidity Traps Despite the efforts of central banks and policymakers, history is littered with examples of liquidity traps that hurt capital markets and global economies. Here are three scenarios when central bank policy proved ineffective at reviving an economy. The Great Depression The biggest economic calamity in history was also one of the best examples of a liquidity trap creating instability. Following the 1929 stock market crash, interest rates began to plummet, but economic activity did not rebound. Despite any Federal Reserve intervention, poor sentiment and deflation persisted, and consumer spending remained depressed until the New Deal financial reforms. Japan's Lost Decade A 10-year bear market followed Japan’s real estate crash in 1989, which saw one of the most enormous asset bubbles pop disastrously. Like during the Great Depression, the Bank of Japan slashed interest rates but didn’t get the bump in consumer spending it hoped for. Deflation and poor consumer sentiment continued throughout the 1990s. The Great Recession The most recent example of liquidity trap fears came during The Great Recession. Following the 2008 Financial Crisis, the Federal Reserve slashed (and kept) rates near zero for an extended period. However, central banks also embarked on a quantitative easing campaign, buying fixed-income assets to support stocks, bonds and real estate. While not a proper liquidity trap, the aftermath of the 2008 Financial Crisis had all the ingredients: low inflation, low rates, and low consumer spending. How to Escape a Liquidity Trap Once the trap is set, how can policymakers provide an escape route? Here are three tools governments and central banks use to break liquidity traps. Quantitative Easing During a quantitative easing program, the central bank will purchase assets like Treasuries from other banks, adding to its balance sheets. It pays for these bonds using reserves, which are deposited into the lower banks and used for lending. Since the bank now has plenty of cash reserves and fewer bond holdings, it can offer loans at reduced rates, which encourages borrowing. The opposite is quantitative tightening, when the central bank sells the assets back into the market and reduces the holdings on its balance. Easing adds money to markets through reserves, while tightening removes money. Fiscal Interventions Monetary policy can influence markets and the economy, but it's a gentle breeze compared to the hurricane winds of fiscal policy. Unlike the Federal Reserve, Congress can pass spending programs that give money directly to citizens and businesses, like the COVID-era stimulus checks and Paycheck Protection Program (PPP) loans. Taxes can also be used as an intervention tool, like tax breaks for hiring new workers or building new factories. Economic Reforms While not often used in response to an acute crisis, economic and regulatory reform can also help prevent liquidity traps. The New Deal reforms following the Great Depression were mentioned above, but laws to increase competition, like antitrust policies, could expand economic growth by promoting innovation and fairness. Laws designed to promote financial stability, like bank stress testing and capital requirements, also fall into this category. 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I'm 89 and have always loved traveling. I've stayed in the fanciest hotels and also camped in the boonies. 2024-06-11 20:39:52+00:00 - By clicking “Sign Up”, you accept our Terms of Service and Privacy Policy . You can opt-out at any time by visiting our Preferences page or by clicking "unsubscribe" at the bottom of the email. Access your favorite topics in a personalized feed while you're on the go. download the app Sign up to get the inside scoop on today’s biggest stories in markets, tech, and business — delivered daily. Read preview This as-told-to essay is based on a conversation with Nancy Strong. It has been edited for length and clarity. When I did the math with my granddaughter, Jennifer, I was amazed to learn I'd visited 92 countries. I've been to five continents and scores of capital cities. On June 15, I'm flying to London from my home in Dallas for the 35th time. This story is available exclusively to Business Insider subscribers. Become an Insider and start reading now. I've stayed in luxury hotels and camped in the boonies My life has been a global adventure with too many memories to count. I've taken a donkey through the ancient ruins of Petra in Jordan, walked along The Great Wall of China, and ventured into the deepest jungles of Vietnam. Advertisement I've stayed in the best hotels and camped in the most basic settings. I've flown in economy, first class, and everything in between and met people living in remote villages in the Far East, even European palaces. Strong in Abu Dhabi. Courtesy of Nancy Strong My first visit abroad was to Canada with my parents at 11. The next was to accompany my financier husband on a business trip to Paris in 1966 at the age of 32. Related stories But I only caught the travel bug after working for a travel agency in Dallas in the fall of 1974. I hand-delivered airline tickets to corporate offices for $2 an hour. But, after five months, I struck out on my own after my three male bosses said I had to make their coffee. My travels mix business with pleasure My agency — which is still going after nearly 50 years — catered to top business executives such as bankers and lawyers. I booked first-class tickets and five-star hotels. I didn't want to recommend anywhere I hadn't stayed myself. I'd get to know the general managers who went the extra mile for my guests. Advertisement The stamps on my passport took up all the pages. Over the years, I went to countries as large as Australia and as small as Lithuania. I sailed on the Great Barrier Reef, toured the Taj Mahal in India, and visited the Berlin Wall. Strong visited the sites of the Normandy landings in France. Courtesy of Nancy Strong One of my favorite continents is Africa. Once, on a safari in Kenya, we got a flat tire. But, lo and behold, a lion was feeding her cubs right next to the vehicle. The driver got out, and a man with a rifle stood sentry to protect us all. I never in my life saw anybody change a flat tire so fast. I wish more people had the opportunity to travel Many moments have taken my breath away. I've watched wildebeests migrate and monks pray in front of Buddha. I danced the tango in Argentina and drank wine in Tuscany. Travel has taught me so much. It's opened my mind and rounded my character. I visited churches, synagogues, and temples. I saw people from different cultures and religions happily going about their lives. There would be world peace if everyone was able to travel and see how alike we are. Advertisement Strong is about to visit London for the 35th time. Courtesy of Nancy Strong I'm 90 in August. My husband, Asa — to whom I've been married for 70 years — is 94. I don't want to leave him for too long, but it's not slowing me down. In May, I went to Paris to see Taylor Swift with some family and friends. Jennifer and I are hoping to catch another of her concerts when we're in London this month. I've always joked that I've been everywhere but Antarctica. But I've just been invited on a cruise to see the penguins. I don't enjoy cold weather. But I never say never. Do you have an interesting story about travel that you'd like to share with Business Insider? Please send details to jridley@businessinsider.com.
My family of 4 moved to France. My child started school at age 3 and gets healthy meals for lunch. 2024-06-11 20:36:42+00:00 - By clicking “Sign Up”, you accept our Terms of Service and Privacy Policy . You can opt-out at any time by visiting our Preferences page or by clicking "unsubscribe" at the bottom of the email. Access your favorite topics in a personalized feed while you're on the go. download the app Sign up to get the inside scoop on today’s biggest stories in markets, tech, and business — delivered daily. Read preview This as-told-to essay is based on a conversation with Phil Coley. It has been edited for length and clarity. My wife, Kristi, and I were inspired to move to France after watching a documentary about British people who'd relocated there. At the time, we rented a two-bedroom home in a sought-after area with high real estate prices. We realized we couldn't afford the type of place we wanted because it would have cost around $260K. This story is available exclusively to Business Insider subscribers. Become an Insider and start reading now. So, in 2017, we bought a four-bedroom fixer-upper in the north-west of France for $29K. Kristi, 38, lived in a tent during the start of the renovations, and I visited every two months to help. I fully transferred in 2020. Advertisement We're in a rural location close to Limoges, which has an airport. It's served by a low-cost airline, and, depending on the time of year, we can fly back to the UK for just $29 round trip. Our family — we have two kids, Alicia, 3, and 18-month-old Haydn — is very happy. Meanwhile, the price of our property — now that it's renovated — has increased to between $215K and $260K. But, finances aside, we can't imagine going back to the UK. Here are three pros and just one con about ex-pat life in France. The French are friendly — but you need to make an effort with their language It's important to try at least to speak some French, even if you get it wrong. In my experience, French people appreciate visitors and ex-pats who try to communicate and respect the culture. Advertisement Some ex-pats do themselves no favors by thinking, "Everyone speaks English, so why bother?" Related stories It can be hard to understand colloquialisms and the local patois. But, if we trip up, it usually ends with a laugh. Family comes first The French don't live to work. They believe spending as much time as possible with family is essential. In August, everything pretty much shuts down. Workplaces close — apart from essential services — and people go on vacation en masse. Advertisement It's usually four weeks of lovely weather, and the campgrounds, hotels, and B&Bs are often full. One of the most popular types of vacation is touring around in an RV. Practically every town and village has a motorhome stopover spot. You stay there for free. The idea is that people will buy something from the local stores, and it will generate business. Kids start school at 3 The education system in France is superior. There are public schools for 3-year-olds, who must be potty trained at that age. The authorities believe adamantly in early education. Alicia goes to school between 9 a.m. and 4 p.m. No academics, and formal classes don't start until the children are 7. Advertisement It's well-known that the French love their cuisine. Alicia is served a healthy, four-course lunch at school. It's far more convenient for parents, and she loves it. There's a lot of bureaucracy The French like everyone to have a job. It's one of the reasons that a large proportion of the population works in the public sector. The downside is that you will never deal with one person. They'll say they must pass things on to a colleague, then another colleague, and so on. Filling out paperwork for a driver's license or passport is laborious and involves a lot of red tape. Advertisement Personally, I've also found that some people dislike online forms and email for official applications. Sometimes, they prefer handwritten or typed paperwork you must print out before sending it. You can wait months for an answer but keep being fobbed off. Eventually, they will say they've lost the forms. And you have to start all over again. Do you have an interesting story about living away from your native country that you'd like to share with Business Insider? Please send details to jridley@businessinsider.com.
Kia says hybrids aren't a threat to EVs but are the perfect gateway to electrification 2024-06-11 20:34:48+00:00 - By clicking “Sign Up”, you accept our Terms of Service and Privacy Policy . You can opt-out at any time by visiting our Preferences page or by clicking "unsubscribe" at the bottom of the email. Access your favorite topics in a personalized feed while you're on the go. download the app Sign up to get the inside scoop on today’s biggest stories in markets, tech, and business — delivered daily. Read preview In recent years, global automakers and their suppliers have invested hundreds of billions of dollars in developing new electric vehicles and the infrastructure to build and support them. However, even as the automotive industry marches toward the inevitable point of full electrification, demand for EVs has slowed over the past year while interest in hybrids has soared. This story is available exclusively to Business Insider subscribers. Become an Insider and start reading now. Hybrids, with their excellent efficiency and lower cost, offer consumers a range-anxiety-free alternative to help bridge the gap between internal combustion and EVs, Steve Kosowski, the manager for Long Range Planning and Strategy at Kia Motors America, told Business Insider in a recent interview. While EV sales fell in the first quarter of 2024 by more than 15% compared to the previous three months — their first drop since 2020 — hybrid sales are booming. Advertisement Traditional hybrids, with lower price points and limited all-electric range, saw a 45.7% sales uptick from January to March, while plug-ins, which are pricier but can go upwards of 60 miles on batteries, grew a whopping 69.7%, according to figures from PWC. A Kia EV3 GT-Line compact electric SUV Kia As a result, some automakers have postponed their plans to abandon internal combustion engines completely. This development would seemingly threaten Kia, which has launched about half a dozen new BEVs in recent years, including the stylish EV3 SUV this May. But Kia sees hybrids as an opportunity to get potential BEV buyers in the door. Advertisement "If you look at resistance in the market to buying an EV, number one is price and then it's range and (charging) infrastructure, " Kosowski said. "But if you look at hybrids and PHEVs, the resistance because of price is much much lower." "The last time I looked, transaction prices for EVs and plug-in hybrids were in the same area, which signals to me that consumers want to electrify and are willing to pay for it," he added." Related stories With range anxiety a non-issue, hybrids, especially those of the plug-in variety, allow people who are hesitant to fully electrify a way to ease into it. A 2024 Kia Niro PHEV. ROBIN TRAJANO/Kia Hybrids accounted for about 8.4% of the total market during the first quarter of 2024. Advertisement But if you look at the largest and arguably most important segment these days, compact SUVs, hybrids account for nearly one-fifth of sales, Kosowski said. This places added importance on the need to have hybrid options available for sale. Fortunately for Kia, the company hedged its strategy and has no fewer than half a dozen hybrids and PHEVs currently on sale in the US, including the Niro Hybrid and Sportage PHEV compact SUVs. "As an automaker, you take a step back from this, and you go, it makes so much more sense to proliferate hybrids within your lineup," he said. Advertisement For Kia, building hybrids instead of EVs affects its bottom line beyond the revenue it generates. EVs cost substantially more to build than ICE and hybrid vehicles. A 2025 Kia Carnival Hybrid minivan. Kia According to Kosowski, who has spent the past two decades with Kia, the material cost of a typical ICE car is half of the sticker price. The cost of materials to build an EV is 50% more than that. "This is the 800-pound gorilla in the room for the industry," he added. "The thing about EVs is their material cost is so high that the margin for everybody gets squeezed until it becomes negative." The popularity is a surprising turn of events from hybrids. Until recentlythey were maligned by consumers for being substantially more expensive and complex than a fully ICE vehicle and by environmentalists for not being as eco-friendly as a full BEV. Advertisement However, hybrids' day in the sun is likely to be temporary due to increasingly stringent environmental regulations. "EV sales can only go up. These cars are coming because every automaker has to sell in order to meet zero-emissions vehicle production (ZEV) regulations, and greenhouse has rules," Kosowski said.
The Federal Reserve is about to make another interest rate decision. What are the odds of a cut? 2024-06-11 20:31:00+00:00 - How the Fed could react to an unexpectedly robust May jobs report How the Fed could react to May jobs report How the Fed could react to May jobs report With the Federal Reserve set to release its latest policy statement on Wednesday, inflation-weary consumers are eager to learn when the central bank might start cutting its benchmark interest rate, providing some relief from high borrowing costs. Unfortunately for consumers, the Fed is widely expected to keep rates steady amid stubbornly high inflation, which remains more than a percentage point above the central bank's annualized target of about 2%. Almost all economists polled by financial data firm FactSet are predicting that monetary policy makers will maintain the federal funds rate in a range of 5.25% to 5.5% — the highest level in 23 years, and where it's sat since the Fed's July 2023 meeting. Still, consumers and investors alike will be listening for clues about the Fed's rate outlook. Federal Reserve officials earlier this year were forecasting three rate cuts, but stubbornly high inflation has clouded its timeline for easing borrowing costs. "Inflation is proving to be sticky in the near term, and continues to linger above the Federal Reserve's 2% target," said Stephen J. Rich, CEO of Mutual of America Capital Management, in an email. "This will likely keep the Fed on hold through the summer, although the consensus is that inflation will gradually decline over the remainder of the year." The delay in cutting rates is hurting lower- and middle-income consumers, who are struggling on two fronts, Rich noted: Inflation remains elevated, raising the costs of everything from groceries to rent, while borrowing costs are also high, making it more expensive to carry credit card debt or take out a loan. Here's what to expect from the upcoming Fed meeting, and beyond. When will the Federal Reserve cut rates? Many economists still think the Fed will cut rates at some point in 2024—just not at the June 12 meeting. According to FactSet, about 9 in 10 economists are predicting that the Fed will also keep rates steady at its July 31 meeting. The first chance of some relief could be at the central bank's September 18 meeting, with about half of economists penciling in the year's first rate cut for that date. On the other hand, most economists don't expect the Fed to increase rates given that inflation has steadily receded from its recent peak of 9.1% in June 2022. In April, consumer prices were rising at an annual rate of 3.4%. The Personal Consumption Index — the Fed's preferred inflation gauge in making rate decisions — in April was up 2.7% from a year ago. How many times is the Fed likely to cut rates in 2024? Wall Street and consumers alike will be watching for clues from the Fed about whether the bank continues to predict three rate cuts in 2024, which it had indicated earlier this year. Some economists are already scaling back their forecasts for the number of rate cuts they expect for 2024. For example, Solita Marcelli of UBS Global Wealth Management predicts two cuts this year, with the first one occurring in September. The Fed on Wednesday will also issue updated economic projections, which are expected to show that they envision one or two rate cuts by year-end, down from a forecast of three in March. What is influencing the Fed's decision on interest rates? Fed Chairman Jerome Powell has repeatedly stated that the central bank prefers keep rates elevated until inflation falls closer to its 2% goal because of the risk that cutting too soon could fuel another round of price spikes. Although inflation has retreated from its 2022 highs, it's remained at an annual rate of about 3.4% to 3.5% so far in 2024, fueled in particular by higher housing costs. According to the Fed's statement after its May 1 meeting, that suggests "a lack of further progress" on defeating inflation. The Department of Labor is scheduled Wednesday to release the Consumer Price Index for May. Economists expect inflation last month to come in at 3.4%, or unchanged from April, according to FactSet. But if the inflation data shows shows further signs of improvement, it could help give policymakers the confidence to dial back their benchmark rate within a few months. How will the Fed's decision impact mortgages and other loans? If the Fed leaves rates unchanged, consumers are likely to continue paying more for mortgages, auto loans and credit card debt. Mortgage rates aren't directly set by the Fed, but its benchmark rate influences them. Without a rate cut on the horizon, mortgage rates could hover around 7% for a while, although that could fluctuate based on other economic factors, noted LendingTree senior economist Jacob Channel. "It is becoming clearer and clearer that the Fed isn't going to lower interest rates anytime soon," noted Matt Schulz, LendingTree credit analyst, in an email. "It might hurt those struggling with debt to hear that, but that's likely the unfortunate reality for the next several months." Consumers with credit card debt should focus on paying off their balances or looking at options such as balance-transfer cards, he noted. If there's a bright spot for consumers, it's that high-interest rate savings accounts, certificates of deposit and other products continue to be available. Even so, some banks have lowered their rates slightly in expectation that the Fed will cut rates at some point this year, noted Ken Tumin, banking expert at DepositAccounts.com. —With reporting by the Associated Press.
A successful Alzheimer's drug will help Eli Lilly join the $1 trillion club 2024-06-11 20:30:00+00:00 - Eli Lilly became the most valuable health-care company in the world on the back of its blockbuster diabetes and obesity drugs. To join the $1 trillion market capitalization club, it will need help from the bench — including an Alzheimer's drug that moved one step closer to market this week. A key advisory panel for the Food and Drug Administration on Monday recommended donanemab, Eli Lilly's treatment for the memory-robbing disease, paving the way for full approval later this year. Donanemab would join Leqembi — co-developed by Biogen and Japanese drugmaker Eisai — as the only two Alzheimer's treatments actively on the U.S. market. Other drugs for people with Alzheimer's only treat the symptoms, not the underlying mechanisms driving the disease. Analysts expect sales of donanemab to total $331 million in 2025 before growing to $705 million in 2026, according to FactSet. Small potatoes, considering the combined revenue from type-2 diabetes therapy Mounjaro and weight-loss treatment Zepbound are projected to be $26.2 billion in 2025 and $33.6 billion in 2026. However, analysts say donanemab helps Eli Lilly diversify beyond the hot GLP-1 class of drugs, helping to offset the risk of more competition in the weight-loss category. For now, Eli Lilly and rival Novo Nordisk, which makes Ozempic for diabetes and Wegovy for obesity, have a duopoly in the GLP-1 market. But the potential for new entrants, even if the bar to entry is high, is always something to watch. To be sure, the market for GLP-1s hasn't dimmed. The billions of dollars in Eli Lilly is investing in manufacturing capacity support the idea that the long-term opportunity is immense. Demand for type-2 diabetes therapy Mounjaro and weight-loss treatment Zepbound has outstripped supply . And recent sales data and other GLP-1 developments have lent further support to Jim Cramer's prediction that the active ingredient behind both Mounjaro and Zepbound, known as tirzepatide, could become the best-selling drug of all time. Buzz around GLP-1s drugs has been the primary fuel for Eli Lilly's blistering stock run, up 59% last year and another 48% so far in 2024 to bring its market capitalization to $817.5 billion. LLY .SPX 5Y mountain Eli Lilly's five-year stock performance compared with the S & P 500. With 951.8 million shares outstanding, Eli Lilly would need to trade slightly above $1,050 a share to reach the vaunted $1 trillion market cap — a milestone anticipated late last year by legendary investor Ken Langone; Morgan Stanley analysts also discussed the possibility in a February note to clients. That implies more than 21% upside from the stock's record close of $865 a share Monday. The new Alzheimer's drug could provide another boost. "Investor focus on donanemab has been greatly diminished since the launch of Zepbound and data that support durable, mega-blockbuster opportunities for LLY in obesity/ cardiometabolic diseases," Cantor Fitzgerald analysts wrote in a note to clients Monday, referencing the benefits to heart health GLP-1s have demonstrated in other trials. "But, a growth opportunity that diversifies sales away from obesity/cardiometabolic diseases is good for LLY." Surprise FDA vote Donanemab slowed cognitive and functional decline by 35% in an early Alzheimer's patient group compared with a placebo group, according to an 18-month trial conducted by Eli Lilly. Meanwhile, Leqembi slowed progression by 28% in its own 18-month study. Leqembi is generally seen as having a better safety profile, though both drugs carry risks around brain swelling and bleeding. Both drugs attempt to slow the progression of Alzheimer's in similar ways by reducing abnormal clumps of the protein amyloid beta that build up on the brain. These amyloid clumps have long been associated with the disease, although their precise role remains up for debate. Leqembi received full FDA clearance in July 2023. Leqembi had a slow launch due in part to health-care system bottlenecks, but Biogen offered encouraging commentary about an acceleration in sales alongside earnings in April. Adding Eli Lilly to the market could help address some of the obstacles that limited Leqembi's sales early on. That includes patients obtaining the MRIs needed to monitor their response to the drugs — part of our thesis in GE Healthcare . The imaging equipment manufacturer also makes a diagnostic agent called Vizamyl, which helps measure amyloid plaque levels. Eli Lilly, which has spent billions in search of a successful Alzheimer's treatment , had hoped for donanemab to be approved by now. But in early March, the FDA surprisingly called the meeting of the advisory panel as it sought clarity on the drug's safety and the impact that its unique trial design had on efficacy. Ultimately, the 11-member FDA advisory panel voted unanimously in favor of donanemab on both of the questions it was tasked to weigh in on. Do the available data show that donanemab is effective for the treatment of Alzheimer's disease in the population enrolled in the clinical trials with mild cognitive impairment and mild dementia? Do the benefits outweigh the risks of donanemab in the treatment of Alzheimer's disease in the population enrolled in the clinical trials with mild cognitive impairment and mild dementia? The 11-0 vote tally came as a surprise to some, with Cantor Fitzgerald analysts describing the results as "better than we anticipated" based on their reading of briefing documents for Monday's meeting released last week. (Jim Cramer's Charitable Trust is long LLY. See here for a full list of the stocks.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust's portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED. A sign with the company logo sits outside of the headquarters campus of Eli Lilly and Company on March 17, 2024 in Indianapolis, Indiana. Scott Olson | Getty Images
Dog fight! Joey Chestnut out of July 4 hot dog eating contest due to deal with rival brand 2024-06-11 20:29:30+00:00 - NEW YORK (AP) — America’s perennial hot dog swallowing champion won’t compete in this year’s Independence Day competition due to a contract dispute, organizers said Tuesday. Joey “Jaws” Chestnut, 40, has been competing since 2005 and hasn’t lost since 2015. At last year’s Nathan’s Famous Fourth of July hot dog eating contest he downed 62 franks and buns in 10 minutes. But Major League Eating event organizer George Shea says Chestnut is moving away from the contest due to a contract dispute. “We love him, the fans love him,” Shea said, adding that “He made the choice.” Shea says Chestnut struck a deal with a competing brand — a red line for the Nathan’s-sponsored event — but did not elaborate. He said the dispute came down to exclusivity, not money. “It would be like Michael Jordan saying to Nike, ‘I’m going to represent Adidas, too,’” Shea said. Chestnut did not immediately respond to a request for comment made through his website. Chestnut has long dominated the competition. Those vying for second place in the past might have renewed hope to swallow their way to first place this year, including international competitors on the eating circuit. Last year’s 2nd place winner was Geoffrey Esper from Oxford, Massachusetts, who downed 49 dogs. Third place went to Australia’s James Webb with 47. That was far from Chestnut’s best effort: his record was 76 Nathan’s Famous hot dogs and buns in 10 minutes in 2021. In 2010, Japanese eating champion Takeru Kobayashi, Chestnut’s then-rival, also stopped competing in the annual bun fight due to a contract dispute with Major League Eating. Kobayashi crashed the contest in a T-shirt reading “Free Kobi” and was arrested. He was sentenced to 6 months’ probation. Kobayashi announced his retirement from the sport last month.
Gas prices are falling along with demand, despite arrival of summer 2024-06-11 20:23:00+00:00 - Florida gas prices are now the lowest since February Florida gas prices are now the lowest since February 00:24 Gas prices are falling across the nation, a pleasant surprise for U.S. drivers as fuel prices typically surge this time of year. The average price for regular unleaded gas in the U.S. was $3.44 per gallon on Monday, down roughly 9 cents from a week ago, according to AAA. That's 19 cents less than a month ago and 14 cents less than last year, according to the auto club. Gas prices are falling because demand for fuel has weakened and oil prices have tapered off, energy experts said, an unusual set of circumstances for the summer season when fuel demands generally peak as more Americans go on road trips for vacation. "Not only have gasoline prices plummeted in nearly every state in the last week, but nearly every state has also seen prices drop compared to a month ago," Patrick De Haan, head of petroleum analysis at GasBuddy, said in a note Monday. "With the declines, Americans will spend roughly $425 million less per week on gasoline than a year ago." Americans cut back on travel Gasoline demand slipped to about 8.94 billion barrels a day last week, down from 10 billion barrels needed per day this same time last year, according to the U.S. Energy Information Administration. One reason fuel demand has fallen appears to be that Americans are not traveling as much as they used to, noted one expert. "Demand is just kind of shallow," AAA spokesperson Andrew Gross said. "Traditionally — pre-pandemic — after Memorial Day, demand would start to pick up in the summertime. And we just don't see it anymore." To be sure, Americans are pinching their wallets tighter due to sticky inflation which is leading many consumers to change their habits. Demand for gas is also down as more drivers have opted for electric or hybrid vehicles, experts said. The drop in gas prices is also notable given that oil companies are now switching to their summer blend of fuel, which is uniquely designed to not evaporate as quickly in warmer weather. Refineries make more than 14 kinds of summer blend due to different state regulations, making the production process even longer, thus driving up prices. Additional factors fueling price decline Still, other factors are also at play. The Biden administration last month announced that it would release 1 million gasoline barrels, or about 42 million gallons, from a Northeast reserve with the aim of lowering prices at the pump. Experts also point to cooling oil costs. Prices at the pump are highly dependent on crude oil, which is the main ingredient in gasoline. West Texas Intermediate crude, the U.S. benchmark, has stayed in the mid $70s a barrel over recent weeks, closing at under $78 a barrel on Monday. That's "not a bad place for it to be," Gross said. "This price-decline party is ramping up, and I expect additional declines ahead of July 4 for both gasoline and diesel prices," De Haan said. Oil prices can be volatile and hard to predict because they're subject to many global forces. That includes production cuts from OPEC and allied oil-producing countries, which have previously contributed to rising energy prices. — The Associated Press contributed to this report.
Chiquita must pay $38.3m to families of Colombian men killed by paramilitary groups, Florida jury says 2024-06-11 20:19:00+00:00 - BOGOTA — Chiquita Brands International must pay $38.3 million in damages to the families of eight Colombian men killed by a paramilitary group in that country, a Florida jury said on Monday. Chiquita in 2007 was ordered by a U.S. court to pay a $25 million fine to settle criminal charges that it did business with the United Self-Defense Forces of Colombia (AUC) paramilitary group. Chiquita pled guilty in that case to paying protection money from 2001 to 2004, which it said it did in order to protect employees. “Chiquita intends to appeal the jury’s verdict," the company said in a statement. "The situation in Colombia was tragic for so many, including those directly affected by the violence there, and our thoughts remain with them and their families. However, that does not change our belief that there is no legal basis for these claims. While we are disappointed by the decision, we remain confident that our legal position will ultimately prevail.” The jury in the civil case before the U.S. District Court Southern District of Florida said in the verdict on Monday that Chiquita knowingly provided substantial assistance to the AUC in the form of cash payments or other means of support, to a degree sufficient to create a foreseeable risk of harm. The men were killed by the AUC, the jury said, and Chiquita did not prove its support for the AUC was the result of impending harm to the company or its employees. “The verdict does not bring back the husbands and sons who were killed, but it sets the record straight and places accountability for funding terrorism where it belongs: at Chiquita’s doorstep,” said Agnieszka Fryszman, a lawyer at law firm Cohen Milstein Sellers & Toll, who represented the plantiffs, said in a statement.
WeWork emerges from bankruptcy, announces John Santora as new CEO 2024-06-11 20:12:00+00:00 - WeWork , the shared office space company once valued at $47 billion, emerged from bankruptcy on Tuesday and named Cushman & Wakefield executive John Santora as its new CEO. WeWork filed for Chapter 11 bankruptcy protection in November, with total liabilities of $18.65 billion against assets of $15.06 billion. The Covid-19 pandemic, which led to a surge in vacancies, coupled with an economic slump and steep downturn in tech valuations, contributed to WeWork's troubles. Santora becomes WeWork's fourth permanent CEO in five years after the company's failed initial public offering in 2019 and subsequent restructuring. He replaces David Tolley, who began service as interim CEO in May 2023 before assuming the permanent role in October. The announcement comes more than a week after WeWork's target exit date of May 31. WeWork also announced a new board, including Anant Yardi, CEO of property management software company Yardi Systems. During Tolley's brief tenure, WeWork entered bankruptcy protection. The company has since renegotiated more than 190 leases and exited more than 170 "unprofitable" locations, according to a company release. Santora previously served as Cushman & Wakefield 's Tri-State chairman and leaves the commercial real estate firm after 40 years. The downsizing of WeWork's real estate portfolio reduced annual rent and tenancy expenses by more than $800 million, and the company also secured $400 million of additional equity capital. WeWork said last week that its portfolio now includes about 45 million square feet in 600 locations across 37 countries. WeWork was founded in 2010 by Adam Neumann and Miguel McKelvey. Neumann led the company through years of historic growth and massive financing rounds. He was ousted in 2019 soon after WeWork's IPO prospectus was released. The company eventually went public in 2021 through a special purpose acquisition company (SPAC), before equity holders were wiped out two years later.
Julia Louis-Dreyfus got 'PC culture' right — and Jerry Seinfeld got it wrong 2024-06-11 20:09:22+00:00 - Comedian Jerry Seinfeld recently made headlines for his comments on political correctness, which he blamed for the dearth of sitcoms these days. When asked about those comments in a recent interview, his former co-star Julia Louis-Dreyfus took a different — and arguably more thoughtful — stance. Louis-Dreyfus, who played Elaine Benes on "Seinfeld," told The New York Times that aspects of comedy and drama from decades ago haven't aged well. "And I think to have an antenna about sensitivities is not a bad thing. It doesn’t mean that all comedy goes out the window as a result," she said. "When I hear people starting to complain about political correctness — and I understand why people might push back on it — but to me that’s a red flag, because it sometimes means something else. I believe being aware of certain sensitivities is not a bad thing." Seinfeld, who is known for his banal observational humor, caused a stir in April when he told The New Yorker that the “extreme left and PC crap and people worrying so much about offending other people” were to blame for the lack of funny TV shows. The comedian has long complained about political correctness, going as far back as 2015, when he lamented that college students who called out prejudice "don’t know what the hell they’re talking about." Those comments were widely criticized at the time. Seinfeld's attitude on political correctness is not especially interesting, nor is it unusual among a subset of aging comedians who seem to struggle with a popular culture that's moving toward inclusivity and the norms that follow. (And some of his observations are pretty easily disproven, anyway.) It's also a point of view shared by many right-wing figures who blame an amorphous idea of "wokeness" on the left for an ostensibly declining state of comedy. Louis-Dreyfus’ comments represent a more astute, less obstinate view on the topic than her former co-star. She told the Times that “political correctness, insofar as it equates to tolerance, is obviously fantastic,” although she stipulated that she didn't know if art created through that lens is “better or not.” “Even classically wonderful, indisputably great films from the past are riddled with attitudes that today would not be acceptable. So I think it’s just good to be vigilant,” she said. “I mean, things have shifted. And in that case, I would say, things have shifted very much for the good.”
Paramount’s Deal With Skydance Falls Apart 2024-06-11 19:57:04+00:00 - Skydance’s merger talks with Paramount were called off Tuesday after Paramount’s controlling shareholder scuttled the deal, ending a drama that has captivated Hollywood for months. The suspended negotiations derail attempts to unite Paramount — the parent company of CBS, MTV and Nickelodeon — with Skydance, the up-and-coming movie studio behind “Top Gun: Maverick” that is an important partner for Paramount’s film business. The deal died just as it neared fruition. Right before Paramount’s special committee voted on the deal, lawyers for National Amusements emailed the committee to say it was ending the discussions. The email said that though National Amusements and Skydance had come to an agreement on economic terms, they could not agree on outstanding “noneconomic terms,” according to two people familiar with the matter. There were several hitches in the last week as Skydance, Paramount and its parent company, National Amusements, reached the final stages of negotiations. Shari Redstone, Paramount’s controlling shareholder, wanted Skydance to agree to provide some legal protection for the deal in case investors filed a lawsuit. Advisers worked through the weekend toward a compromise on those and other terms that had been outstanding. Even as the two sides made progress, a committee of Paramount’s board members evaluating the plan fired a public relations firm it had been using.
OpenAI ex-employees worry about company's control over their millions of dollars in shares 2024-06-11 19:50:00+00:00 - OpenAI CEO Sam Altman speaks during the Microsoft Build conference at Microsoft headquarters in Redmond, Washington, on May 21, 2024. Jason Redmond | AFP | Getty Images OpenAI plans to allow stakeholders to sell a portion of their shares every year, but the company, which has been valued at over $80 billion, is taking a restrictive approach that's raised concerns among current and former employees about the startup's power to determine who participates, CNBC has learned. Due to OpenAI's skyrocketing valuation following the launch of ChatGPT in late 2022, many early employees are sitting on millions of dollars worth of equity. With no IPO on the horizon and a price tag that makes the company too expensive to be acquired, the only way for shareholders to realize any value from their equity in the near term is through secondary stock sales. However, current and former OpenAI employees have been increasingly concerned about access to liquidity, according to interviews and documents shared internally. Those fears have intensified in recent weeks after reports that the company had the power to claw back vested equity, said people familiar with the matter, who asked not to be named because the information they shared is confidential. In an attempt to assuage some of those concerns, OpenAI recently circulated a document, obtained by CNBC, titled, "Overview and Recap of OpenAI's Tender Process," detailing how the company has conducted equity purchases in the past and how it plans to handle them in the future. The issue has become a major topic of conversation at OpenAI and among people who have recently left, according to internal documents, Slack messages and exit agreements viewed by CNBC, as well as conversations with multiple former OpenAI employees. OpenAI has told employees that it will try to hold one tender offer roughly every year, but that depends on how both the company and the market are faring at the time, a person with knowledge of the matter said. It's the latest controversy at OpenAI, which has been at the center of the tech universe for much of the past 18 months, most recently announcing a partnership with Apple on Monday to integrate ChatGPT and Siri. Backed by roughly $13 billion from Microsoft , OpenAI has an atypical "capped-profit" model, with a nonprofit as the governing entity for the for-profit subsidiary. Less than seven months ago, co-founder Sam Altman was suddenly ousted as CEO due to a conflict with the board, before being abruptly reinstated days later after an uproar among investors and loyal staffers. watch now The Federal Trade Commission and the Justice Department, meanwhile, are set to open antitrust investigations into Microsoft, OpenAI and Nvidia, examining their influence on the AI industry, a source familiar with the matter confirmed to CNBC last week. And last month, OpenAI disbanded its team focused on the long-term risks of AI just a year after forming the group. That came shortly after OpenAI co-founder Ilya Sutskever and Jan Leike, announced their departures, with Leike writing in a post on X that OpenAI's "safety culture and processes have taken a backseat to shiny products." As OpenAI has grown, the company has used aggressive tactics to get employees to sign exit agreements that affect the future of their stock holdings. "If you have any vested Units and you do not sign the exit documents, including the General Release, as required by company policy, it is important to understand that, among other things, you will not be eligible to participate in future tender events or other liquidity opportunities that we may sponsor or facilitate as a private company," OpenAI wrote in the agreement, which was viewed by CNBC. The paperwork for departing employees says that in order to participate in tender events and liquidity opportunities, the person must be in compliance with "all applicable company policies, as determined by OpenAI." Last month, OpenAI announced it would backtrack on a controversial decision to make former employees choose between signing a non-disparagement agreement that would never expire and keeping their vested equity in the company. An internal memo, viewed by CNBC, was sent to former employees and shared with current staffers. The memo, addressed to each former employee, said that at the time of the person's departure from OpenAI, "you may have been informed that you were required to execute a general release agreement that included a non-disparagement provision in order to retain the Vested Units [of equity]." "We're incredibly sorry that we're only changing this language now," an OpenAI spokesperson told CNBC after the company changed course. "It doesn't reflect our values or the company we want to be." In an email sent to CNBC late Monday, an OpenAI spokesperson said, "All eligible current and former employees have been offered opportunities for liquidity at the same price in the past, regardless of where they work or what they signed at departure." The company doesn't expect that to change, the spokesperson said. 'Further questions to address' A former employee, who shared his OpenAI correspondence with CNBC, asked the company for additional confirmation that his equity and that of others was secure. "I think there are further questions to address before I and other OpenAl employees can feel safe from retaliation against us via our vested equity," the ex-employee wrote in an email to the company in late May. He added, "Will the company exclude current or former employees from tender events under any circumstances? If so, what are those circumstances?" The person also asked whether the company will "force former employees to sell their units at fair market value under any circumstances" and what those circumstances would be. He asked OpenAI for an estimate on when his questions would be addressed, and said he hasn't yet received a response. OpenAI told CNBC that it is responding to individual inquiries. According to internal messages viewed by CNBC, another employee who resigned last week wrote in OpenAI's "core" Slack channel that "when the news about the vested equity clawbacks provisions in our exit paperwork broke 2.5 weeks ago, I was shocked and angered." Details that came out later "only strengthened those feelings," the person wrote, and "after fully hearing leadership's responses, my trust in them has been completely broken." The person then tagged CEO Sam Altman in the message, highlighting what he described as a paradox in Altman's stated effort to responsibly build artificial general intelligence, or AGI. "You often talk about our responsibility to develop AGI safely and to distribute the benefits broadly," he wrote. "How do you expect to be trusted with that responsibility when you failed at the much more basic task" of not threatening "to screw over departing employees," the person added. watch now The company has also, in the past, opened up "donation rounds" to current employees, allowing them to donate a certain amount of their vested equity to charity, which brings with it tax incentives. Former employees could be excluded, as the donation rounds will likely be offered "to active employees only and are not guaranteed to happen," according to messages viewed by CNBC. Much of the discussion around future stock issues will now likely include a new voice, after OpenAI announced on Monday that it hired Sarah Friar, who was previously CEO of Nextdoor and CFO of Square, as its finance chief. OpenAI, which was founded in 2015, has held three tender rounds to date. The first was in mid-2021, the second was between April and June 2023, and the latest was between November 2023 and March 2024. For former employees, the rounds typically took place months after transactions for current staffers, according to an internal document. In at least two tender offers, the sales limit for former employees was $2 million, compared to $10 million for current employees. In addition to current and former employees, OpenAI has a third tier for share sales that consists of ex-employees who now work at competitors. Rather than being an official tender, the third group participates in "direct secondary transactions facilitated directly between the buyer (OpenAI or pre-approved investors) and seller," according to an internal document. OpenAI said in the document that the reason for separating current and former employees is to avoid delaying the sale process for existing workers and to get a sense of how much equity they want to sell before committing to terms for those who have left. OpenAI said the reason for the third category had to do with "safeguarding competitively sensitive information," since "by law, we must share certain information with all sellers and buyers in the same tender offer." "For example, in prior tender offers, we have disclosed detailed financial data, and non-public information about our Microsoft deals, even when the negotiations were still ongoing and unannounced," the company wrote in the internal document. Larry Albukerk, founder of EB Exchange, which helps tech workers with pre-IPO stock sales, told CNBC that while companies have a lot of latitude in how they handle tender offers, as long as it's written in the contract, creating an adversarial relationship with former employees can be damaging for morale. "Ultimately, employees are going to become ex-employees," Albukerk said. "You're sending a signal that, the second you leave, you're not on our team, and we're going to treat you like you're on the other team. You want people to root for you even after they leave." Stock worth $0? Of even greater concern, some insiders said, is language in the terms of a corporate document related to Aestas, a company OpenAI set up to manage the offerings. The document suggests ex-employees could be stripped of their equity. For anyone who leaves OpenAI, "the Company may, at any time and in its sole and absolute discretion, redeem (or cause the sale of) the Company interest of any Assignee for cash equal to the Fair Market Value of such interest," the document states. Former OpenAI employees said that anytime they received a unit grant, they had to send a document to the IRS stating that the fair market value of the grant was $0. CNBC viewed a copy of the document. Ex-employees told CNBC they've asked the company if that means they could lose their stock for nothing. OpenAI said it's never canceled a current or former employee's vested equity or required a repurchase at $0. Legal experts said OpenAI's treatment of ex-employees who leave to work at competitors could be problematic, especially in California. In April, the FTC voted to ban non-compete agreements for for-profit companies. A final rule will go into effect in September. The ban not only protects people from punishment for accepting another role, but also covers any agreement that "penalizes a worker" or "functions to prevent" a worker from working at a competitor. An attorney, who asked not to be named due to client conflicts in the space, said that OpenAI's behavior towards those ex-employees leaves a "plausible argument" for future litigation tied to the non-compete issue. Another attorney, who also requested anonymity, called it "undue pressure." "It sounds like they are playing hardball, but they would be far from the only company to act like this in the resale of their private securities," Doug Brayley, a partner at Ropes & Gray, said in an interview. "Private companies generally leave themselves a lot of discretion about how to treat the repurchase of their equity." WATCH: Cult of the founder: who is Sam Altman?