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Poppi faces lawsuit from consumer who questions its gut health claims 2024-06-03 19:56:57+00:00 - Popular soda brand Poppi is facing a class-action lawsuit filed by a consumer who says its products don’t improve gut health as much as their marketing suggests. In a lawsuit filed last week in U.S. District Court in San Francisco, Kristin Cobbs said she purchased Poppi drinks on multiple occasions because of their labels, which say they are prebiotic sodas and feature the slogan, “Be Gut Happy. Be Gut Healthy.” But Cobbs later found that Poppi drinks contain only around 2 grams of prebiotic agave inulin fiber, which she said is insufficient to provide any real benefit. Cobbs cited research showing that consuming 7.5 grams of agave inulin daily for three weeks was insufficient to confer any meaningful prebiotic benefit. If consumers drink more Poppi, any prebiotic benefits would be outweighed by increased sugar consumption, the lawsuit said. Cobbs is seeking monetary relief for herself and similar customers. Austin, Texas-based Poppi said in a statement Monday that it stands behind its products. “We are on a mission to revolutionize soda for the next generation of soda drinkers, and we have diligently innovated to provide a tasting experience that millions of people have come to enjoy,” the company said. “We believe the lawsuit is baseless, and we will vigorously defend against these allegations.” The Associated Press sent an email message seeking comment to Poppi, which is based in Austin, Texas. Poppi is one of dozens of brands in the exploding category of functional beverages, which claim to improve health and wellness. U.S. sales of prebiotic and probiotic drinks more than tripled last year, according to data compiled by consulting firm AlixPartners.
Consumer Bureau to Create ‘Corporate Offender’ Registry 2024-06-03 19:52:57+00:00 - The Consumer Financial Protection Bureau on Monday finalized a plan to create a public registry of nonbank businesses that have been penalized for violating consumer protection laws, a roster some have called a “rap sheet” for companies. The goal, the consumer bureau said, is to make it easier for consumers, watchdogs and government prosecutors to identify patterns and recurrences. “Too many American families and businesses have been harmed by repeat offenders in a rinse-and-repeat cycle of illegal activity,” Rohit Chopra, the bureau’s director, said at a news conference. “When companies believe that violating the law is more profitable than following it, this totally undermines public trust and harms businesses who are playing by the rules.” The bureau estimates that at least 1,500 and as many as 7,750 companies will be subject to inclusion in the registry. The database will compile orders from state, federal and local governments and courts against companies that have faced sanctions for lawbreaking.
Microsoft is laying off hundreds in its Azure cloud business, sources say 2024-06-03 19:50:57+00:00 - Microsoft is cutting hundreds of jobs from the Azure business, sources say. The layoffs impact Azure for Operators and Mission Engineering teams. Microsoft's layoffs have become more frequent, following last year's plan to cut 10,000 jobs. 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 Microsoft is cutting hundreds of employees from its Azure cloud business, according to people familiar with the situation. The layoffs impacted teams including Azure for Operators and Mission Engineering, the people said. One of the people estimated the Azure for Operators layoffs involved as many as 1,500 job cuts. These sources asked not to be identified discussing private matters. This story is available exclusively to Business Insider subscribers. Become an Insider and start reading now. Have an account? Log in .
A grant program for Black women business owners is discriminatory, appeals court rules 2024-06-03 19:36:16+00:00 - NEW YORK (AP) — A U.S. federal court of appeals panel suspended a venture capital firm’s grant program for Black women business owners, ruling that a conservative group is likely to prevail in its lawsuit claiming that the program is discriminatory. The ruling against the Atlanta-based Fearless Fund is another victory for conservative groups waging a sprawling legal battle against corporate diversity programs that have targeted dozens of companies and government institutions. The case against the Fearless Fund was brought last year by the American American Alliance for Equal Rights, a group led by Edward Blum, the conservative activist behind the Supreme Court case that ended affirmative action in college admissions. Blum applauded the ruling, saying “programs that exclude certain individuals because of their race such as the ones the Fearless Fund has designed and implemented are unjust and polarizing.” Fearless Fund CEO and Founder Arian Simone said the ruling was “devastating” for the organizations and the women it has invested in. “The message these judges sent today is that diversity in Corporate America, education, or anywhere else should not exist,” she said in statement. “These judges bought what a small group of white men were selling.” Alphonso David, Fearless Fund’s legal counsel who serves as president and CEO of The Global Black Economic Forum, said all options were being evaluated to continue fighting the lawsuit. The legal effort to dismantle workplace diversity programs has suffered its share of setbacks as well, reflecting polarized opinions among liberal and conservative judges on the issue. Last week, for example, a federal district judge in Ohio dismissed a lawsuit against the insurance company Progressive and fintech platform Hello Alice challenging a program that offers grants to help Black-owned small businesses purchase commercial vehicles. Similar lawsuits have been dismissed against Amazon, Pfizer and Starbucks. The case against the Fearless Fund has been closely watched by civil rights groups, philanthropic organizations, employment lawyers and the venture capital industry as a bellwether for how the courts are viewing programs intended to level the playing field for racial minorities and other groups that have historically faced discrimination in businesses and workplaces. In a 2-1 ruling, the panel of the U.S. Court of Appeals for the 11th Circuit in Miami found that Blum was likely to prevail in his lawsuit claiming the grant program violates section 1981 of the 1866 Civil Rights Act, which prohibits discrimination on the basis of race when enforcing contracts. The Reconstruction-era law was originally intended to protect formally enslaved people from economic exclusion, but anti-affirmative action activists have been leveraging it to challenge programs intended to benefit minority-owned businesses. The court ordered the Fearless Fund to suspend its Strivers Grant Contest, which provides $20,000 to businesses that are majority owned by Black women, for the remainder of the lawsuit that is being litigated in a federal court in Atlanta. The ruling reversed a federal judge’s ruling last year that the contest should be allowed to continue because Blum’s lawsuit was likely to fail. However, the grant contest has been suspended since October after a separate panel of the federal appeals court swiftly granted Blum’s request for an emergency injunction while he challenged the federal judge’s original order. The appeals court panel, consisting of two judges appointed by former President Donald Trump and one appointed by former President Barack Obama, rejected the Fearless Fund’s arguments that the grants are not contracts but charitable donations protected by the First Amendment right to free speech. “The fact remains, though, that Fearless simply —and flatly — refuses to entertain applications from business owners who aren’t ‘black females,’” the court’s majority opinion said, adding “every act of race discrimination” would be deemed expressive conduct under the Fearless Fund’s argument. The appeals panel also rejected the Fearless Fund’s contention that Blum had no standing because the lawsuit was filed on behalf of three anonymous women who failed to demonstrate that they were “ready and able” to apply for the grant or that they had been injured by not being to do so. Judge Robin Rosenbaum, an Obama appointee, disagreed in a blistering dissent, likening the plaintiffs’ claims of harm to soccer players trying to win by “flopping on the field, faking an injury.” Rosenbaum said none of the plaintiffs demonstrated that they had any real intention to apply for the grants in what she called “cookie-cutter declarations” that were ”threadbare and devoid of substance.” The panel’s ruling wasn’t surprising because of its conservative leaning and previous skepticism towards the argument presented by the Fearless Fund, said David Glasgow, executive director of the Meltzer Center for Diversity, Inclusion, and Belonging at New York University’s School of Law. “We are going to see some pro-DEI outcomes in liberal circuits and anti-DEI outcomes in conservative circuits,” Glasgow said. Glascow said he expects one of the lawsuits to land in the conservative-dominated Supreme Court. Even so, he said it’s unlikely that any one ruling could settle the legal debate over corporate DEI because of the complexity and wide-ranging programs and policies that fall under the category. The Strivers Grant Fund is one of several programs run by the foundation arm of the Fearless Fund, which was founded to address the wide racial disparity in funding for businesses owned by women of color. Less than 1% of venture capital funding goes to businesses owned by Black and Hispanic women, according to the nonprofit advocacy group digitalundivided. The National Venture Capital Association, an trade group with hundreds of member VC firms, filed an amicus brief defending the Fearless Fund’s grant program as “modest but important” step to toward creating equal opportunity in an industry that has historically excluded Black women. Only 2% of investment professionals at venture capital firms were Black women in 2022, according to a study conducted every two years by Deloitte and Venture Forward, the nonprofit arm of the National Venture Capital Association, and the consulting firm Deloitte. Just 1% of investment partners were Black women, according to study, which surveyed of 315 firms with 5,700 employees representing $594.5 billion in assets under management. But in his statement, Blum said “our nation’s civil rights laws do not permit racial distinctions because some groups are overrepresented in various endeavors, while others are under-represented.” Philanthropic groups are also watching the case because of its possible implications for charitable giving. “If legal decisions curtail people’s ability to give in ways that align with their values or their experience, it’s going to hurt not only philanthropy and nonprofits, but our own country as a whole,” said Kathleen Enright, president and CEO of the Council on Foundations, whose organizations filed an amicus brief supporting the Fearless Fund with the nonprofit Independent Sector. _____ AP Writers Thalia Beaty and Haleluya Hadero in New York contributed to this story. _____ The Associated Press’ women in the workforce and state government coverage receives financial support from Pivotal Ventures. AP is solely responsible for all content. Find AP’s standards for working with philanthropies, a list of supporters and funded coverage areas at AP.org.
Spotify hikes price of memberships as it seeks to drive profits 2024-06-03 19:24:00+00:00 - Spotify subscriptions will become a little more expensive next month as the audio streaming service plans to raise its membership prices for the second time in less than a year. Starting in July month, Spotify's individual plan will jump $1 to $11.99 a month and its Duo plan will increase $2 to $16.99 a month. The family plan will increase $3 to $19.99 while the student plan will remain $5.99 a month. The increase will help it "continue to invest in and innovate on our product features and bring users the best experience," Spotify said in a statement Monday. The increase comes after Spotify in April reported a record profit of $183 million for the first quarter of 2024 after growing its monthly subscribers to 615 million, up from 515 million the year prior. During an earnings call with analysts, CEO Daniel Ek said the company is focusing less on gaining subscribers and concentrating more on revenue growth. "Next year, our focus may return to top-of-the-funnel user growth but in the near term, monetization remains our top priority," Ek said. The Stockholm, Sweden-based company was founded in 2006 but has struggled to consistently turn a profit since going public in 2018. The company posted an operating loss of $81.6 million in the fourth quarter of 2023. The company raised its prices around the same time a year ago in a move it said at the time would help "deliver value to fans and artists." During the same earnings call, Spotify's interim Chief Financial Officer Ben Kung said "our data shows that historical price increases have had minimal impacts on growth." Spotify laid off hundreds of employees after overhiring during the pandemic. The company had taken advantage of lower borrowing rates between 2020 and 2021 and financed an expansion, investing heavily in employees, content and marketing, Spotify said in a December blog post. But the company in 2023 implemented three rounds of job cuts, beginning in January of last year, when the company slashed 6% of jobs, bringing its workforce to 9,200 employees. Just four months later, it cut another 2%, or 200 employees, mostly in its podcasting division. Spotify let go another 1,500 in December 2023. Spotify also hiked prices this year in Australia, Pakistan and the United Kingdom. Its stock price rose 4.5% in midday trading to $310 a share.
The most troubling aspect of Trump’s war on the verdict 2024-06-03 19:13:50+00:00 - Minutes after Donald Trump became the first American president, former or current, to be convicted of a crime, he lumbered slowly down the center aisle of the courtroom to leave Courtroom 1530. And almost as soon as he emerged on the other side of the doors, he began to wage a war on the verdict that has continued virtually nonstop since. But what’s most problematic about Trump’s post-verdict revenge isn’t its constancy. It’s his blatant, multiple lies about a case that I and dozens of other journalists have tracked for the 14 months since his indictment. From poring over each filing and order to attending the entirety of every trial day, I saw it all — including the verdict. It’s difficult to choose which of Team Trump’s lies is the most pernicious. Given that, it’s difficult to choose which of Team Trump’s lies is the most pernicious. Is it the former president’s assertion that the judge improperly blocked his “reliance on the advice of counsel” defense? (Spoiler alert: Trump’s team declined to invoke that defense.) Is it his insistence that this case could and should have been brought seven years ago, despite his attempt to convince the Supreme Court that the Manhattan district attorney was not even entitled to seek documents from him during his presidency? Maybe it’s his post-verdict portrayal of himself as a “political prisoner”? Or is it his claim that he didn’t know what the charges were — and that the verdict wasn’t required to be unanimous? To my mind, it’s none of these. Trump’s “big (trial) lie” is that Judge Juan Merchan’s rulings precluded him from testifying or so much as speaking about the case. Let’s start with the notion that he was prevented from testifying. According to Trump, he desperately wanted to testify, but “the theory is you never testify ... because they will get you on something you said slightly wrong.” But of course, lapsed recollections or misconceptions about dates, times or who else was or was not at an event — the sorts of mistakes that prosecution witness David Pecker might have made — are hardly the stuff that perjury charges are made of. Trump’s decision against testifying — a choice that, as Merchan repeatedly advised him, belonged to him alone — was more likely borne of serious concerns about the scope of cross-examination. Merchan ruled, well before the defense presented its case, that Trump could be questioned about the two jury verdicts on E. Jean Carroll’s defamation claims, Judge Arthur Engoron’s decision in the New York attorney general’s civil fraud case, and even certain settlements. Why? Because they could bear on Trump’s credibility, just as Michael Cohen’s guilty pleas and American Media’s non-prosecution agreement were appropriately considered by the jury in assessing Cohen’s and Pecker’s credibility, respectively. It’s one thing for a lawyer to argue a client’s position based on dubious claims; it’s another for that lawyer to put a client on the stand knowing he will swear to the same. Trump’s lawyers also very well could have feared that their client would testify under oath to demonstrable falsehoods, including that the payments to Cohen were always intended to cover legal fees. It’s one thing for a lawyer to argue a client’s position based on dubious claims; it’s another for that lawyer to put a client on the stand knowing he will swear to the same. But what about the gag order? Didn’t that play some role in silencing Trump at or during trial? Not one bit. As Merchan patiently reminded Trump in open court, the gag order pertained only to extrajudicial statements, meaning those made outside of court. But more importantly, Trump certainly knows full well that even the most stringent interpretation of the gag order doesn’t preclude him from talking about the core of the district attorney’s case or his defenses thereto — or about the three main characters he says have been in cahoots against him: Merchan, Manhattan DA Alvin Bragg and President Joe Biden. That Trump — who literally cannot stop talking about the case — has the audacity to claim that the judge has made it impossible to talk about the case? Among the array of increasingly rehearsed lies Trump is telling, that might be the most pernicious.
Musk’s X is allowing users to post consensual adult content, formalizing a prior Twitter policy 2024-06-03 19:05:59+00:00 - The social media platform X says it will now formally allow people to show consensual adult content, as long as it is clearly labeled as such. The move makes official a policy already in place when the platform was known as Twitter, before billionaire Elon Musk purchased it in 2022. In a recent update on its website, the San Francisco-based company said users “should be able to create, distribute, and consume material related to sexual themes as long as it is consensually produced and distributed. Sexual expression, whether visual or written, can be a legitimate form of artistic expression.” Adult material was allowed under the pre-Musk Twitter as well, although there was no official policy in place. X said it is restricting adult content for children and for adult users who choose not to see it. “We also prohibit content promoting exploitation, nonconsent, objectification, sexualization or harm to minors, and obscene behaviors,” X said. It added that it does not allow sharing adult content in “highly visible” places such as users’ profile photos or banners. X’s policy stands in contrast to other social media platforms, such as Meta’s properties — Instagram and Facebook — as well as TikTok and Google’s YouTube. “The platform’s move to allow ‘adult content’ dovetails well with the company’s post-Musk marketing strategy,” said Brooke Erin Duffy, associate professor of communication at Cornell University. “X is unapologetically provocative and has sought to distinguish itself from ‘brand safe’ competitors.” The company appears to be courting people, including creators and artists, who have been marginalized by other social media platforms that have guidelines restricting nudity or sexual expression, she added. The policy applies to real as well as artificial-intelligence-generated material. X is asking users who regularly post adult content to adjust their media settings to place all their images and videos behind a content warning. This requires users to acknowledge that they want to see the posted image before they can view it.
Reality check: is Keir Starmer’s triple lock on nuclear weapons anything new? 2024-06-03 19:00:00+00:00 - Keir Starmer has announced a “triple lock” on Britain’s nuclear weapons policy as he seeks to portray Labour as the party of security in the general election campaign. The Labour leader said his party would be “totally committed” to the UK’s submarine-based nuclear weapons programme, and that he would be prepared to authorise their use. “Even as we work tirelessly for peace, we have to be fit to fight,” he said in a speech at the Fusilier Museum in Bury, Greater Manchester, on Monday. What is the pledge? Starmer said there were three prongs to Labour’s nuclear triple lock: maintaining Britain’s continuous at-sea deterrent (CASD) “24 hours a day, 365 days a year”, meaning there is always a nuclear-armed sub in the water at any time; building four new nuclear submarines; and delivering “all the needed upgrades” for existing and new submarines in the future. Grant Shapps, the Conservative defence secretary, said Labour’s position was “meaningless” because members of the shadow cabinet, including deputy leader Angela Rayner, have previously voted against replacing the UK’s nuclear weapons. Would the triple lock be a big change? Not really. The UK already has CASD, with four Vanguard-class submarines, one of which is at sea at any time to avoid detection. Labour and the Conservatives have been committed to building four new submarines in the Dreadnought class to replace them since 2007. The commitment to “upgrades” is particularly unclear, given there is no public information available to Labour on what technologies the subs would need. The Campaign for Nuclear Disarmament (CND) said Starmer’s policy “just mirrors that of the existing government”. Rishi Sunak reiterated the government’s commitment to the deterrent in March. However, Starmer’s commitment to CASD could still be significant as the system is looking increasingly shaky due toproblems with Vanguard, with delays and cost overruns hindering their replacement, according to David Cullen, director of the Nuclear Information Service (NIS), a non-profit that monitors nuclear weapons policy. He said he is “disappointed that [the Labour party is] coming out so boldly about something that might not be deliverable”, rather than leaving an option to examine the UK’s nuclear posture to see what is possible. How much would it cost? The government has said Dreadnought would cost £31bn plus a £10bn “contingency”. The NIS said in 2019 that the full cost of the nuclear weapons programme between 2019 and 2070 could be £172bn, when including new warheads and running costs. The indications from those people in the know are that the quoted costs could well increase. The government’s Infrastructure and Projects Authority has for the last two years said that successful upgrades to factories building submarines’ nuclear cores appear “unachievable”. Jon Thompson, the former Ministry of Defence (MoD) permanent secretary, in 2016 said nuclear weapons were a “monster” that “keeps me awake at night”. The National Audit Office (NAO), a government watchdog, in December said that costs to support the nuclear deterrent were £7.9bn above budget for 2023. The NAO also reported an alarming £38.2bn increase in forecast costs at the MoD’s Defence Nuclear Organisation to £99.5bn over the decade to 2033 – a 62% increase on estimates a year earlier. How will it be paid for? Both Labour and the Conservatives have committed to spending 2.5% of the UK’s GDP on defence, by 2030 in the case of the Tories. Labour has not given a date but Starmer on Monday said this would happen “as soon as possible within our fiscal rules”. Those rules commit the UK to cutting the proportion of debt to GDP over a rolling five-year forecast period. If major tax increases are ruled out, then fiscal rules could force a new government to cut other department budgets. Nuclear spending is ringfenced within the MoD budget. The NAO is concerned that the overriding desire to protect the nuclear programme could also mean that other parts of the military have funding cut. Is it affordable? All prime ministers since the second world war have chosen to remain nuclear-armed, arguing that the vast costs of the as-yet-unused weapons are the price of security and geopolitical power. The CND’s general secretary, Kate Hudson, said the nuclear budget should be used for “rebuilding our decaying public services and improving people’s lives”, but Starmer – the first Labour leader in 30 years to visit the nuclear submarine factory in Barrow-in Furness, Cumbria – has made it clear that is not up for debate in his Labour party. Yet whichever party wins the most seats next month, the long-term affordability of the nuclear weapons programme may depend on whether there are more cost overruns lurking in the depths of the MoD’s plans.
Jeep expects to grow plug-in hybrid SUV sales by as much as 50% in 2024 2024-06-03 18:59:00+00:00 - Jeep plans to grow U.S. sales of its plug-in hybrid electric vehicles by as much as 50% this year as it leans into the technology as a bridge between its traditional gas-guzzling SUVs and all-electric vehicles amid a slower-than-expected sales pace of EVs. The Stellantis brand expects to sell 160,000 to 170,000 plug-in hybrid electric vehicles, or PHEVs, in the U.S. this year, an increase of 40% to 50% from last year, Jeep CEO Antonio Filosa told CNBC. The target comes as Jeep launches its first all-electric SUVs in the U.S., beginning with the Wagoneer S. “It’s the best time to be flexible, as we are,” Filosa said during an interview Thursday after unveiling the brand’s new EV in New York. “One of the pillars of growth for the market is going to be freedom of choice.” PHEVs, which combine an internal combustion engine with EV technologies, could help accelerate consumer adoption of electrified vehicles, as a sort of stutter step to all-electric models. PHEV sales at the level Jeep is expecting this year would top Stellantis’ total 2023 U.S. sales of the vehicles, at roughly 143,000 units. They also would outperform an industry forecast for 27.5% segment growth this year, according to AutoPacific. That compares with the consulting and data firm’s 17% growth for EVs. Jeep’s PHEV sales last year totaled 113,113 units, including 67,429 Jeep Wranglers and 45,684 Jeep Grand Cherokees. Through the first quarter of this year, sales totaled 31,750, up 47% from the same period a year earlier. The brand is first in the U.S. in PHEV sales. Jeep has leaned into PHEVs more than others to offset sales of the brand’s gas-guzzling SUVs amid tightening emissions and fuel economy standards. The next Jeep vehicles are expected to be the Wagoneer S EV this fall, followed by a Wrangler-like EV called the Recon and a replacement for the discontinued Cherokee midsize SUV during the first half of next year. The automaker also will add new plug-in “range-extender” models to its gas-powered Wagoneer and Grand Wagoneer large SUVs in 2025. “We have a game plan. We have a business plan, and we believe that price position and product wise, we are perfect to meet the volume we want to make,” Filosa said. Both hybrids and plug-in hybrids have a traditional engine combined with EV technologies. A traditional hybrid, such as the Toyota Prius, has electrified parts, including a small battery, to provide better fuel economy to supplement the engine. Plug-in hybrids typically have a larger battery to provide for all-electric driving for a certain number of miles until an engine is needed to power the vehicle or electric motors. Both Filosa and Stellantis Chief Technology Officer Ned Curic said the company is evaluating whether to launch traditional hybrid vehicles in the U.S. in addition to its plug-in models. “We’re deciding at the moment how will the market respond to our hybrids,” Curic said during a separate interview. “We have a good mix on our roadmap between EV, PHEV, [and internal combustion engine].” The “range-extender electric vehicle” models, or REEVs, operate slightly differently than typical hybrids. The vehicles can operate as a zero-emissions EV until the vehicle’s battery dies and an electric onboard generator — powered by a 3.6-liter V6 engine — kicks on to power the vehicle after its initial charge. Stellantis’ first REEV vehicle is expected to be the Ram Ramcharger full-size pickup truck later this year. “This is quite a good option,” Curic said. “I’m confident that vehicle is going to do exceptionally well.” The REEVs are expected to be priced higher than PHEVs (which already carry a premium compared to traditional gas-powered vehicles) but below all-electric models, according to Curic.
Paramount and Skydance agree to terms of a merger deal 2024-06-03 18:58:00+00:00 - Paramount and Skydance have agreed to terms of a merger, CNBC’s David Faber reported Monday. A deal could be announced in the coming days, he said. A Paramount special committee and the buying consortium — David Ellison’s Skydance, backed by private equity firms RedBird Capital and KKR — agreed to the terms. The deal is awaiting signoff from Paramount’s controlling shareholder, Shari Redstone, who owns National Amusements, which owns 77% of class A Paramount shares, Faber said Monday. The agreement terms come after weeks of discussion and a recent competing offer from Apollo Global Management and Sony Pictures. “We received the financial terms of the proposed Paramount/Skydance transaction over the weekend and we are reviewing them,” said a National Amusements spokesperson. The deal currently calls for Redstone to receive $2 billion for National Amusements, Faber reported Monday. Skydance would buy out 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 also contribute $1.5 billion in cash to Paramount’s balance sheet to help reduce debt. Following the deal’s close, Skydance and RedBird would own two-thirds of Paramount, and the class B shareholders would own the remaining third of the company, Faber reported. The negotiated terms were reported earlier by The Wall Street Journal. The deal will not require a vote from the shareholders, which was part of the negotiations, Faber reported. Paramount’s annual shareholder meeting will take place on Tuesday. The deal is valued at $8 billion, an increase from the $5 billion offer on the table earlier. Under those earlier terms, Redstone would have received less than $2 billion for her stake, and the class B shareholders would have been bought out at a nearly 30% premium at $11 a share, CNBC previously reported. No deal announcement is expected before the meeting, according to people familiar with the matter, who asked not to be named because the discussions are private. In addition to the twists and turns of the negotiations with buyers, Paramount’s C-suite has also undergone a shakeup in recent months. Bob Bakish stepped down as CEO in late April and was replaced by what the company calls the “Office of the CEO.” Paramount is now led by three executives: George Cheeks, CBS president and CEO; Chris McCarthy, president and CEO of Showtime/MTV Entertainment Studios and Paramount Media Networks; and Brian Robbins, the head of Paramount Pictures and Nickelodeon. They plan to present strategic priorities at Tuesday’s annual meeting. Later in the day Tuesday, there will be a previously scheduled board meeting, where the temporary leaders will again present, said the people. Redstone has approved of the ideas and the leadership of the triumvirate during its short tenure, said one of the people. In early May, Apollo and Sony formally expressed interest in acquiring Paramount for about $26 billion, CNBC previously reported. However, Redstone has favored a deal that would keep Paramount together, and Apollo and Sony planned to break up the company, CNBC previously reported.
Bad economic news has been good for stocks, but that could change this week 2024-06-03 18:54:00+00:00 - Bad economic news so far has been mostly positive for the stock market, as investors worry over whether the Federal Reserve will start cutting interest rates. There’s a danger, though, of overdoing it, where too much bad news could signal a significant downturn and even recession ahead. That’s the dilemma the market finds itself in approaching a week of critical data, mostly focusing on the all-important U.S. labor market, which in turn provides signals about the health of the consumer. “Bad news has been good news for equities over the past two months ... but if growth deteriorates too much, bad news can turn into bad news,” Ohsung Kwon, equity and quant strategist at Bank of America, said in a client note Monday. Kwon points out that during that period, the S&P 500 and U.S. dollar have diverged in almost perfect unison. The dollar index has been on a steady though gradual decline, while the large-cap equity index has been on a similar steady though gradual rise. The trend has become particularly acute over the past month, which has seen the S&P 500 climb about 3%. The greenback often rises on bad news as investors seek the safety of cash and equivalents, while the stock market gains on good news. At the same time, economic data has generally deteriorated, or at least not met Wall Street forecasts. The Citi Economic Surprise Index, which measures actual data against consensus expectations, began sliding in mid-April, turning negative in late May while falling about 120%. The countercyclical measure indicates that expectations were outpacing reality. For the most part, bad economic news likely could help convince the Fed that the time is right to start lowering interest rates. The one exception is higher inflation, which would push the Fed toward tighter monetary policy. The central bank has held its benchmark borrowing rate in a range of 5.25%-5.5% since July 2023, the highest level in some 23 years. Fears about a more hawkish Fed on inflation have caused multiple bouts of volatility in the stock market. That brings the market to this week’s run of data, which includes surveys on job openings and private job creation, concluding Friday with the Bureau of Labor Statistics’ nonfarm payrolls report. Economists surveyed by Dow Jones expect growth of 178,000 jobs for the month, which would be about in keeping with April’s 175,000, and likely hold the unemployment rate at 3.9%. If the estimate is about correct, it would put job creation in the “Goldilocks range” of 125,000 to 175,000 of not too hot and not too cold, according to Bank of America experts. However, anything below 125,000 could mean a reversal from the bad-news-is-good-news trend, in which a rising unemployment rate could trigger a yardstick known as the Sahm Rule, the bank said. Devised by economist Claudia Sahm at New Century Advisors, the rule holds that if the unemployment rate averaged over three months is half a percentage point higher than the 12-month low, the economy is in the early stages of recession. As of May, the 12-month low would be 3.5%, meaning the jobless rate would have to hold a three-month average of 4% to meet the Sahm hurdle. Based on the prior two months, the unemployment rate would have to rise to 4.3% in May for that to happen. However, Bank of America sees that as unlikely, expecting above-consensus job growth of 200,000. “As long as inflation remains in check, stronger growth should also be positive for stocks,” Kwon wrote. Still, BofA’s strategy team expects market volatility around the report and believes the market is underpricing the chance of a market move. The firm recommends an options strategy known as a “straddle” as a way to capitalize on a potential market swing. The move involves buying both puts and calls on S&P 500 options that expire on the same day and have the same strike price. It pays off when the index either rises or falls from the strike price by more than the premium paid. BofA said the trade finished in the money six of the previous eight weeks.
Company that bred beagles for research pleads guilty to neglect, ordered to pay record $35M fine 2024-06-03 18:49:18+00:00 - A company that bred beagles for medical research agreed Monday to pay a record $35 million as part of a criminal plea admitting it neglected thousands of dogs at its breeding facility in rural Virginia. Prosecutors said the penalties amount to the largest ever levied in an animal-welfare case. The plea deal also bars the company that operated the facility, Envigo RMS, as well as parent company Inotiv, from breeding or selling dogs in the future. The federal investigation of Envigo drew national attention in May 2022 when federal authorities conducted a search of the breeding facility in Cumberland County, Virginia, and found nearly 450 animals in acute distress. The company later agreed to relinquish all 4,000 beagles at the facility, which were sent around the country for adoption. U.S. Attorney for the Western District of Virginia Christopher Kavanaugh, whose office prosecuted the case, said Monday after a plea hearing at federal court in Charlottesville that Envigo and Inotiv “prioritized profits and convenience over following the law.” He said the company generated $16 million in revenue between 2019 and May 2022, when the search occurred, through the sale of 15,000 beagles over that time. But he said the company refused to make the investments necessary to provide for the animals’ basic care. Cages were cleaned twice a month rather than every day as required. Animals were euthanized, including by direct injections to their heart, without sedation, he said. Dogs were routinely injured by getting their paws caught in flooring composed of metal grates that left space for paws to easily fall through. Food and water were lacking and unclean Court records show that 300 puppies died over a seven-month stretch around 2021 for what was described as “unknown causes.” He said the company continued to employ a veterinarian who had botched surgeries and oversaw numerous violations because executives believed it would be too difficult to find a replacement. Todd Kim, assistant attorney general for the environment and natural resources division of the Justice Department, said Envigo “unlawfully enriched itself by failing to spend the necessary money for upgrades and by failing to hire enough trained and competent staff.” The Cumberland facility, which employed nearly 40 people, has been shuttered. Kavanaugh said it was woefully understaffed to care for thousands of dogs. The plea deal calls for an $11 million fine for violating the Animal Welfare Act and an $11 million fine for violating the Clean Water Act. The deal also requires Inotiv to spend $7 million over the next three years to improve its facilities and meet standards in excess of the Animal Welfare Act requirements. The plea deal includes an admission that Envigo violated the Clean Water Act by discharging hundreds of thousands of gallons of improperly treated wastewater. It also includes a $3.5 million for environmental repairs in Cumberland County and requires the company to pay the cost of a compliance monitor while it’s on probation, which will run for a period of three to five years. The plea agreement also requires the companies to pay roughly $1.9 million to the Humane Society of the United States for assistance it provided to the investigation. Prosecutors also said their investigation is ongoing and that criminal cases against individual employees remain possible. West Lafayette, Indiana-based Inotiv issued what it called a “statement of contrition” Monday after the plea hearing. “In committing the crimes identified in the charging document, and by not making the necessary infrastructure upgrades and hiring the requisite staff, we fell short of our standards for animal and environmental welfare and apologize to the public for the harm caused by our conduct, the company said. “In resolving this matter, we renew our commitment to maintaining the highest standards of animal care.”
HMRC apologises for delayed payment of child benefit to about 500,000 people 2024-06-03 17:57:00+00:00 - About 500,000 people in the UK expecting child benefit payments did not receive them on Monday, with some parents saying the shortfall left them unable to buy food for their children or facing bank charges. HM Revenue and Customs (HMRC) apologised after about 30% of child benefit payments scheduled for 3 June did not arrive in claimants’ bank accounts. Late on Monday afternoon, it said those affected would now receive their money on Wednesday morning. HMRC said the problem was caused by a processing error that had since been resolved, and not – as some people on social media had suggested – a data hack. Child benefit is usually paid every four weeks on a Monday or Tuesday. The standard weekly payment is £25.60 for the eldest or only child, and £16.95 for each additional child. On the social media platform X, some parents said they needed the money right away. One posted that “we rely on it and live payday to payday, how do I feed my kids?” Another wrote: “This is my family’s food money for the next few weeks, and so many other families face the same.” A third, Toni Kemp, said: “My children will be home soon with nothing for dinner as like most parents we still are waiting for the money to hit our accounts to be able to buy our children food tonight,” adding: “How do we feed them?” Amy Pearson tweeted: “So when will these be solved? I have 2 kids one disabled and my electric is beeping on emergency. I rely on this money on a Monday to top my meter up.” Meanwhile, Kim Fuller said she had breast cancer and was relying on her child benefit to pay for after-school childcare while she went to a pre-operation assessment appointment, which she now could not attend and would have to postpone. Some people talked about bank overdraft charges that would be incurred or payments that might bounce as a result of the money not arriving. An HMRC spokesperson said: “We are very sorry that some customers did not receive their scheduled child benefit payments as expected, and we understand the concern and difficulty this may have caused. We have now fixed the problem and are putting measures in place to prevent this from happening again.” skip past newsletter promotion Sign up to First Edition Free daily newsletter Our morning email breaks down the key stories of the day, telling you what’s happening and why it matters Enter your email address Sign up Privacy Notice: Newsletters may contain info about charities, online ads, and content funded by outside parties. For more information see our Newsletters may contain info about charities, online ads, and content funded by outside parties. For more information see our Privacy Policy . We use Google reCaptcha to protect our website and the Google Privacy Policy and Terms of Service apply. after newsletter promotion They added: “Affected customers will now receive their payments on Wednesday morning (5 June). Anyone who has incurred a direct financial loss because of the delayed payment can apply for redress by completing our online complaints form.” Some people can have their child benefit paid weekly – for example, if they are a single parent or receive certain other benefits such as universal credit. HMRC has a complaints section on its website here.
A Mazda, a Gift Bag of $120,000 and a Dismissed Juror 2024-06-03 17:42:56+00:00 - A woman drove up to a Minnesota home in a Mazda on Sunday night with a bag of cash totaling $120,000, ready to hand it to one of the 12 jurors in a multimillion-dollar charitable fraud case in the Minneapolis federal courthouse. “This is for Juror 52,” Assistant U.S. Attorney Joe Thompson quoted the woman saying, according to a story in the Sahan Journal. “Tell her there will be another bag for her if she votes to acquit.” The juror was not home at the time, so the woman left the cash and the message with a relative, Mr. Thompson said in court, according to accounts from journalists in the courtroom. The U.S. attorney’s office said in an interview with The New York Times that the accounts were accurate and that more details would be forthcoming. Prosecutors said the juror reported the apparent bribery attempt to the local police. That revelation roiled the trial of seven defendants accused of stealing $41 million from government programs meant to feed hungry children, through a nonprofit called Feeding Our Future, during the Covid-19 pandemic. Prosecutors have accused them — and dozens of others — of stealing $250 million by claiming to have served nonexistent meals to nonexistent children.
UK ‘robber baron’ company Melrose gives bosses £176m handout 2024-06-03 17:29:00+00:00 - The UK engineering firm Melrose Industries has handed out a £176m reward pot to 21 of its current and former executives, with the lion’s share going to three of them. In a move that is likely to further fuel the controversy over executive pay, the FTSE 100 company confirmed on Monday that the bosses had been issued with shares totalling £176m under a bonus scheme set up in 2020. The business’s former finance director Geoffrey Martin, and two of its co-founders – ex-CEO Simon Peckham and previous chair Christopher Miller – have received the lion’s share of the 28.8m shares being handed out. As they no longer work for the company, Melrose does not have to disclose how much they are getting, but it is understood it could be up to half of the total – £88m. The trio will have to hold on to shares worth three times their former salaries, roughly about £1.5m each, but can sell the rest at any time. The payout, which follows similar bumper deals for the bosses of UK firms such as AstraZeneca’s Pascal Soriot and David Schwimmer of the London Stock Exchange, is the product of a four-year performance plan under which managers stood to gain 7.5% of any increase to the market value of the company since 2020. During that period, the share price of the group has increased by more than £4bn, with the business currently worth more than £8.1bn. The scheme was set up just a couple of years after the company came in for heavy criticism over a hostile takeover of the British engineering stalwart GKN, which led to Melrose being condemned by the Tory MP Robert Halfon as “robber baron capitalism at its worst”. While the total pot for the payout was around £330m, the company said that just under £160m had been paid to HMRC, with the company in effect cancelling 25m shares to raise the cash. Peter Dilnot, Melrose’s current chief executive, will receive just over £1m in shares but will be unable to sell them while still at the company. The payouts will be the final payday for Miller and Peckham, who alongside David Roper set up Melrose in 2003. After making a series of big industrial acquisitions, its most high-profile deal came in 2018 with the GKN takeover. That prompted Melrose to refocus as a specialist aerospace company, with operations in the US, UK and Sweden. In 2023, it recorded profits of £390m on £3.4bn of revenue. Speaking to the Sunday Times in April, Peckham said the bumper award represented a “good payout”. He said: “You could take a view that no one should earn more than this or that, but I would say that’s capitalism working.”
Atlanta water woes extend into fourth day as city finally cuts off leak gushing into streets 2024-06-03 17:14:50+00:00 - ATLANTA (AP) — For at least some residents, Atlanta’s water problems weren’t over Monday. Milena Franco, who lives in the city’s Midtown neighborhood, said she and her husband had water all weekend. But Monday morning, the flow was cut off, as Franco discovered when she tried to take a shower. “I got in the shower and I just cried for a little bit,” Franco said. City officials said water was shut down in the immediate neighborhood as part of an effort to stanch the flow from a broken main that had been gushing a river into streets since Friday night. The geyser finally dried up around sunrise Monday, after officials trucked in parts from Alabama under a police escort. But a swath of the city remained under an order to boil water before drinking it, even in areas where pressure had been restored after a first mammoth leak was fixed Saturday. The area under the boil water order shrank drastically Monday afternoon, but the days of outages had some residents frustrated with the pace of repairs. “We are laser-focused on this problem and my administration understands how critical water is for our lifeline in this city,” Dickens told reporters at the site of the water main break Monday. But his news conference ended before reporters could ask all their questions because resident Rhett Scircle was asking the questions residents in nearby buildings wanted to know. “When will the water be back on? Is there any estimated timeline? We live right here!” Scircle yelled at Department of Watershed Management Commissioner Al Wiggins Jr. Wiggins, who has been commissioner for less than a month, declined to estimate when water would be flowing again, as backhoes dug in a hole behind him. Officials provided no estimates of how many residents were still affected or how many had been affected at peak. Atlanta’s water outages are the latest failures as cities across the country work to shore up faltering infrastructure. A 2022 crisis in Jackson, Mississippi, which has a long-troubled water system, left many residents without safe running water for weeks. Atlanta has spent billions in recent years to upgrade its aging sewer and water systems, including a tunnel drilled through 5 miles (8 kilometers) of rock to store more than 30 days of water. Last month, voters approved continuing a 1-cent sales tax to pay for water and sewer work. The city historically dumped untreated sewage into creeks and the Chattahoochee River, until a federal court order to stop. Wiggins said Monday that “there’s always ongoing work” on the city’s water system. Later, he told City Council members that there will be a comprehensive inspection of the entire system. The outage hasn’t affected the entire city of 500,000 — many areas in Atlanta’s northern and southern ends never lost water pressure and never faced a boil order. But for tens of thousands of residents, trouble began Friday when a junction of three water mains sprang a massive leak west of downtown. Wiggins said that leak was caused by corrosion and was tricky to repair because the three pipes created a confined space for work. The Midtown leak began hours later. Wiggins said city workers still aren’t sure why it happened, but said it to was difficult to fix because it happened at a junction of two large water pipes, and the valve to turn them off was inaccessible because of the gushing liquid. The city instead dug holes in four directions a block away to cut the flow to the Midtown leak, although Scircle and some other residents said they saw little work for much of Saturday and Sunday. Water pressure began to be restored early Sunday for many, and some big events, like a concert and an Atlanta United soccer match took place downtown Sunday. Some high-rise office buildings remained closed Monday, saying there wasn’t enough water pressure to run air conditioning units and deliver water to high floors. Dickens, a first-term Democratic mayor, was in Memphis, Tennessee, conducting a political fundraiser for his 2025 reelection campaign Friday and did not return until Saturday. Spokesperson Michael Smith said that Dickens also met with Memphis Mayor Paul Young and other leaders, that officials didn’t yet realize the severity of problems when he left Friday and that Dickens was in “constant communication” with Atlanta officials. Many residents have attacked the city’s response, saying officials continued failing to communicate clearly, even after Dickens apologized Saturday and promised updates at two-hour intervals. Jose Franco, Milena Franco’s husband, said he and his wife had kept drinking tap water for a time because they didn’t know about the boil water order. Both he and his wife said the water cutoff in their apartment took them by surprise before dawn Monday. “If they know there’s not going to be water for a few days, they should provide more free water,” Jose Franco said. And he noted “the elephant in the room” — the inability to flush toilets. Marie Moore, who lives in a high-rise apartment building for seniors and people with disabilities, wheeled her walker to a fire station in Midtown to pick up a case of bottled water. Firefighters there were wrestling three more pallets of water off a truck, saying they were handing out cases quickly. Moore, whose water slowed to a trickle over the weekend, said the city needs to tap more federal money to improve infrastructure. “It seems like everything is falling apart,” she said. Dickens declared a state of emergency so the city could buy materials and hire workers without following purchasing laws, but a spokesperson said there’s no estimate yet of how much the emergency has cost the city.
Why Joe Manchin leaving the Democratic Party was the right call 2024-06-03 17:10:40+00:00 - Sen. Joe Manchin of West Virginia spent his entire political career, spanning more than 40 years, as a member of the Democratic Party. That run ended on Friday, when he announced that he was leaving the party to become an independent. But though Manchin is ending a decades-long association, this news feels less like a shocking twist than an acknowledgement of the status quo between Manchin and a party where he’d worn out his welcome. As is ever the case with Manchin, who has made centrism the core of his senatorial persona, he blamed both sides of the aisle for his decision. “Our national politics are broken and neither party is willing to compromise to find common ground,” he declared in a statement. “To stay true to myself and remain committed to put country before party, I have decided to register as an independent with no party affiliation and continue to fight for America’s sensible majority.” Overly self-important rhetoric aside, there’s some truth to Manchin’s words. Overly self-important rhetoric aside, there’s some truth to Manchin’s words. While the GOP is the party that has shifted the most since he first joined the Senate in 2010, some of the coal-loving West Virginian’s views have been an increasingly tough fit within the Democratic Party. He’s a vestige of a period when conservative Democrats like the House’s Blue Dog Coalition were deemed necessary for the party’s long-term survival. But their power has waned significantly in recent years and Manchin has increasingly stood apart from even other red-state centrists like Montana Sen. John Tester. He’s further frustrated other Democrats with his shifting stances during key negotiations and his fetishization of bipartisanship. Manchin told Vox back in 2021 that he’d never considered fully jumping ranks and joining the GOP, “because I know I can change more from where I’m at. And I still believe in the principles of the Democratic Party that I grew up with.” He’s also confirmed that he’s rebuffed numerous attempts from his Republican colleagues to join the dark side. So, despite leaving the party officially, he will still caucus with the Democrats for the remainder of his term and retain his chairmanship of the Senate Energy Committee. Manchin now becomes the fourth independent in the caucus alongside Bernie Sanders of Vermont, Angus King of Maine, and Kyrsten Sinema of Arizona. Moreover, and more important for the timing of his announcement, the politics in Manchin’s home state have been shifting rapidly as well. For years, he has kept the national party at arm’s length in order to survive politically in West Virginia (let’s not forget that he released an ad where he shot a copy of a cap and trade bill when he first ran for the Senate in 2010). Every decision he’s made since arriving in Washington — including his defense of the filibuster over expanded voting rights and defense of coal — has been done through the lens of local politics, for better or for worse. But no state in the country swung faster from loyally Democratic to loyally Republican, with former President Donald Trump winning blowout victories in the last two elections. Rather than go through the meat grinder of a tough Senate campaign, Manchin last year announced that he would be giving up his seat, despite having already registered to run. Republicans have nominated Jim Justice, West Virginia’s governor, to try to win the open seat — but Manchin’s shift may have changed the calculus. June 1 was the deadline for a candidate to change their party affiliation if they want to appear on the ballot in the fall. The deadline to run for either Senate or governor, the job that Manchin held before heading becoming a senator and had considered running for again in 2020, isn’t until Aug. 1. The reality is that having an "I" next to his name doesn’t change who Manchin is, and has been, for a long time now. Compared to other options, Manchin’s choice to become an independent is somehow the least destructive route he could take. Unlike Sinema, who registered as an independent in 2022 after wildly swinging across the political spectrum, Manchin has remained rooted in place ideologically. Likewise, he’s spent a long time flirting with this decision, having said as much last year. And it’s better for him to either try to stay in the Senate while keeping the same positions, or run for an open gubernatorial seat, than to pull the trigger on an almost certainly disastrous third-party presidential run — a prospect he’d flirted with earlier this year. Should he run to retain his seat, that’s one less guaranteed layup for Republicans trying to reclaim the majority. And I’d rather see Manchin’s support for the filibuster neutralized with a more solid Democratic majority next term than have Justice there to either support Trump or block President Joe Biden depending on who wins in November. And while Manchin has said he supports the Democratic nominee for governor, that was conveniently a few days before he left the party. Though I’ve often slammed Manchin’s record as a senator, either decision would be a net positive for both him and Democrats. The reality is that having an "I" next to his name doesn’t change who Manchin is, and has been, for a long time now. It merely makes what was once subtext into text — and gives more progressive Democrats room to define what the party will look like in the future.
Jack Smith wants Judge Cannon to stop Trump from putting law enforcement at risk 2024-06-03 17:07:19+00:00 - When we last checked in on the Donald Trump classified documents saga, U.S. District Judge Aileen Cannon had rejected special counsel Jack Smith’s motion to bar the defendant from making statements endangering law enforcement, stemming from Trump’s false suggestion that agents were complicit in a plot to assassinate him. Importantly, Cannon only rejected the motion on procedural grounds, allowing Smith to try again. He did so Friday, reiterating the government’s stance that “Trump’s repeated mischaracterization of these facts in widely distributed messages as an attempt to kill him, his family, and Secret Service agents has endangered law enforcement officers involved in the investigation and prosecution of this case and threatened the integrity of these proceedings.” Smith’s bid to protect the proceedings in the face of menacing Trump statements calls to mind the gag order in the recently concluded New York trial. There, Judge Juan Merchan imposed the order and found Trump in contempt 10 times for violating it, with the integrity of those proceedings in mind. Yet, as we’ve seen in their respective handling of Trump’s criminal cases, Cannon is no Merchan. Indeed, though the Trump appointee’s prior rejection of Smith’s motion was procedural, the tone of her rejection, coupled with her handling of the case generally, suggests she’ll ultimately rule for Trump on the merits. On that note, the judge isn’t even making his lawyers respond to Smith’s motion until June 14, with Smith’s reply due June 21. True to form, Cannon isn’t in a rush. To recap the timeline, Smith filed his initial motion May 24, which the judge (temporarily) rejected May 28 for what she deemed the government’s failure to properly confer with defense counsel in connection with the filing. Smith’s latest motion notes proper conferral as ordered. Now, the written litigation in this matter — which is just a tiny fraction of the pending issues in the case that still lacks a trial date — isn’t set to conclude until nearly a month after the initial filing. And to answer the naturally arising question, Cannon’s slow-walking of litigation to the routine benefit of the presumptive GOP nominee who appointed her to the bench isn’t something that, on its own, would warrant removing her from the case. That’s probably why Smith hasn’t sought to do so yet. Trial judges have vast discretion over their dockets. We’ll see if Smith appeals Cannon’s ultimate ruling on this issue and whether he seeks a new judge in connection with any appeal he takes. But with the schedule she set, we won’t even know how Cannon rules until later this month, at least. Subscribe to the Deadline: Legal Newsletter for weekly updates on the top legal stories, including news from the Supreme Court, the Donald Trump cases and more.
Extreme heat set to drive home cooling costs to 10-year high, advocates warn 2024-06-03 17:00:00+00:00 - The average cost of keeping an American home cool from June to September is set to hit $719, nearly 8% higher than last year, according to new projections from advocates for low-income households. That level would be the highest in a decade, and a steep jump from the $573 average in 2021. Organizations distributing federal financial support expect they’ll be able to help roughly 1 million fewer families pay their energy bills this year. That’s partly because government funding for the Low Income Home Energy Assistance Program (LIHEAP) fell from $6.1 billion last fiscal year to $4.1 billion for the current one, the National Energy Assistance Directors Association (NEADA) and the Center for Energy, Poverty and Climate said in a report released Monday. “It’s inflation in the sense that you have to spend more to cool your house, but you’re using more of it,” said Mark Wolfe, executive director of NEADA, which represents state directors who manage federal aid dollars for home energy costs. “So you can’t blame the price. This is more the price of climate change.” 2024 is expected to rank among the five warmest years in recorded history, the National Oceanic and Atmospheric Administration has said, and this year has a 61% chance of being the hottest on record. Already last month, scorching heat and humidity descended on parts of Texas, the Gulf Coast and South Florida. Last summer, too, was severely hot. Phoenix, for example, endured a record-breaking 31 consecutive days of temperatures at or above 110 degrees Fahrenheit. Electric costs this summer will vary geographically, from as low as $581 on average for the season in Wisconsin, Michigan, Illinois, Indiana and Ohio, to as high as $858 in Texas, Oklahoma, Arkansas and Louisiana, the report said. While bills in the latter region are forecast to rise only 1.8%, the mid-Atlantic is expected to see a 12% increase in summer electric bills since last season. Many households face imminent risks, the report said, from taking on debt to finance their cooling bills to suffering potentially dangerous utility shut-offs for nonpayment. Only 17 states and Washington, D.C., offer residents some protections against shut-offs, the report said, and nearly 1 in 5 “very low income” families have no home air conditioning at all. LIHEAP was originally devised to help low-income residents cover their heating bills during cold winter months. But soaring summertime temperatures have added pressure to the program. This year about 80% of its funds will cover heating expenses, leaving just 20% to supplement cooling bills, the advocacy groups estimated. “These estimates could, in fact, understate the final costs of home cooling this summer if temperatures continue to reach record levels,” the report warned. LIHEAP administrators in many states have been sounding alarms in recent years over higher seasonal temperatures, saying rising summertime demand is outstripping the available funding. Unlike safety-net programs like Medicaid or food stamps, LIHEAP can’t guarantee support to all qualifying households. If demand is too high, funds can simply run out. Brian Sarensen, who manages Washington state’s LIHEAP aid, previously described “the Catch-22 of trying to provide everything to everybody that needs it, and just not having enough money to do so.” “We may be sacrificing how much heating assistance we give in the winter to hold over for the summer,” he told NBC News last summer, when a series of blistering heat waves drove up air conditioning usage across the country. “But at the same time, then you’re thinking: Am I leaving somebody to freeze to death?” Some relief could come this year in states that are offering residents income-based subsidies on their electricity bills, Wolfe said. For example, there’s Connecticut — a state in the Northeast, where electricity generation is generally more expensive for utilities — which launched a financial hardship program last December allowing consumers to avoid shut-offs and receive monthly discounts of either 10% or 50% depending on their income. Already, though, ballooning energy bills are squeezing the least well-off, the report warned. Researchers found 23.5% of households couldn’t pay their energy bill for at least one month over the past year, up from 21.3% the year before. The steepest jump was among households with children, rising to 33.1% from 28.4% in the prior period. To cover energy bills, many low-income families are making difficult cutbacks elsewhere. More than 1 in 3 said they reduced or went without basic household expenses at least once in the last 12 months due to energy costs, with the biggest increase again among those with kids — for a rate of 41.5%. “We’re now approaching a period where people can’t just sweat it out,” said Wolfe. “It’s pretty grim.”
GameStop shares soar after "Roaring Kitty" reveals $116 million stake 2024-06-03 16:24:00+00:00 - Why are GameStop shares on the rise again? Why are GameStop shares on the rise again? Why are GameStop shares on the rise again? GameStop stocks rose Monday following speculation that the man behind the meme-stock craze owns a large number of shares of the video game retailer that could be worth millions. The company's stocks were up 25%, as of 11:28 a.m. Monday, hovering at around $29 a share. Keith Gill, better known as "Roaring Kitty," posted a screenshot in the r/SuperStonk forum on Reddit that users on the platform are interpreting as an image of company stock and call options that Gill holds in GameStop. The image suggested Gill may own 5 million shares of GameStop that were worth $115.7 million as of the closing price on Friday. In addition, Roaring Kitty on Sunday night posted a picture on X of a reverse card from the popular game Uno. There was no text accompanying the image. "As a meme in pop culture, an UNO Reverse card acts as the ultimate comeback that flips the script on someone," according to WikiHow. A former financial analyst at MassMutual, Gill is in late 2020 encouraged individuals on Reddit to invest in GameStop encouraged amateur retail investors to buy GameStop shares during the meme stock craze. He did this by posting on Reddit discussion boards and creating videos on YouTube about the strategy, gaining a large following in the process. But in 2021, Gill revealed that he had lost $13 million in one day from his investments in GameStop. GameStop's stock jumped more than 87% in premarket trading and opened at $32.35 a share. "If those gains hold, the stock would add around $8 billion to its market capitalization," said Nigel Green, the CEO of financial services firm deVere Group, in an email. "These super quick, super high, headline-grabbing figures are likely going to attract another huge wave of interest and, therefore, capital. I would not be surprised if the stock added $100 billion by the end of Monday due to the frenzy." Gill's Roaring Kitty posts over the weekend comes about three weeks after he resurfaced online for the first time in three years. He did so simply by posting an image on the Roaring Kitty account on X of a man sitting forward in his chair, marking the end of a his hiatus. That post was followed by several others featuring various comeback-themed videos from movies along with charged music. His reappearance caused the price of GameStop to spike. In 2021, GameStop was a video game retailer struggling to survive as consumers switched rapidly from discs to digital downloads. Wall Street hedge funds and major investors were betting against it, or shorting its stock, believing that its shares would continue on a drastically downward trend. GameStop had experienced declining sales amid an industrywide pivot from game cartridges to video game streaming and digital downloads, but with the help of meme stock investors, last March the company turned its first profit in two years. Before then, the company had posted seven straight quarterly losses. This January, GameStop reported its first annual profit since 2018. Last September, GameStop appointed Chewy founder Ryan Cohen as its new CEO. In its most recent quarterly earnings from March, GameStop said it eliminated an unspecified number of jobs to help reduce costs. The Texas-based company posted $1.79 billion in revenue compared to $2.23 billion a year prior. Gill was also slapped with a lawsuit in 2021, accusing him of profiting from "deceitful and manipulative conduct" in promoting the GameStop shares. After appearing before Congress to explain the meme-stock phenomenon, his social media presence dwindled to nonexistence. —The Associated Press contributed to this report.