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The Supreme Court's timing on Trump's eligibility may have clues to immunity ruling 2024-03-05 17:52:36+00:00 - The Supreme Court got its ruling in Trump v. Anderson out just before Super Tuesday. Heading into this past weekend, it wasn’t clear when the decision on Donald Trump’s ballot eligibility would come, but then the justices abruptly announced Monday as an opinion day. That seemed to telegraph a ruling in the ballot case, and so it was (in Trump’s favor, as expected). I recount that brief history because timing is a crucial factor in another Trump case on the high court's docket: his immunity appeal. If Trump v. Anderson’s timing is any indication of how soon an immunity decision could come, it doesn’t necessarily bode well for special counsel Jack Smith’s prosecution in the federal election interference case. While everyone knows that a Trump presidential victory in November would empower him to crush the prosecution, that practical reality isn’t formally at issue in the immunity appeal. Indeed, the justices don’t seem overly bothered by further delay in the Washington prosecution, because they could’ve just rejected Trump’s immunity appeal and sent it back for trial, or they could’ve scheduled arguments for sooner than the week of April 22. To be sure, if they had wanted to punt the case definitively past the election, they could’ve taken more aggressive delay measures. But the high court’s actions have put the viability of a lengthy trial before the election in question, to say the least. So if Super Tuesday was the court’s deadline for Trump v. Anderson, what’s the deadline in the immunity appeal (officially "Trump v. United States")? There really isn’t one, as far as the justices are concerned. They typically issue the term’s final decisions by July, and it’s reasonable to view the court’s moderately expedited late April hearing date as a sign they will rule by that unofficial late June deadline. But the court has many important cases to resolve at that point in the calendar. That’s when the most contentious decisions arrive because they take the most effort to sort out. With Trump v. United States now added to that end-of-term crush, the question is whether and to what extent the court prioritizes the immunity appeal. And, assuming the ruling goes against Trump, any dissenting justices could add further delay. Ultimately, if it takes the court until the last minute of its unofficial end-of-term deadline, like it did with the ballot case ahead of Super Tuesday, that could make a federal election interference trial before the election all but impossible. 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.
Former cheesemaker pleads guilty in listeria outbreak that killed two people 2024-03-05 17:39:00+00:00 - A former cheese manufacturer and the company he owned pleaded guilty on Tuesday to misdemeanor charges related to a 2016-2017 outbreak of listeria that hospitalized eight people and killed two. Johannes Vulto and Vulto Creamery of Walton, New York, pleaded guilty to one misdemeanor count of causing the introduction of adulterated food into interstate commerce between December 2014 and March 2017, the Department of Justice announced. Vulto Creamery's soft raw cheese was behind the sole multistate outbreak of listeriosis in 2017, resulting of a nationwide recall of the raw milk cheeses sold by the company, according to the Centers for Disease Control and Prevention. FDA investigators found workers at the creamery did not wash their arms before using them to stir and break up cheese curds, including one employee with multiple cuts and abrasions on his arms. Swabs of Vulto's creamery repeatedly tested positive for the bacteria over the three-year period. "This investigation and prosecution holds accountable the defendant and his business who through unsafe practices caused illness and death to consumers in an entirely preventable tragedy," U.S. Attorney Carla B. Freedman for the Northern District of New York stated in a statement. A sentencing date will be set by a magistrate judge in Syracuse, New York, the Justice Department said. The creamery was shut down in 2017 by a federal court, which barred Vulto and its owner from making or distributing food in the future. Federal investigators are currently investigating another listeria outbreak tied to cheese and other dairy products sold by Modesto, Calif.-based Rizo-López Foods. At least 26 people in 11 states have been stricken in the ongoing outbreak, with 23 hospitalized, according to the CDC. One person died in California in 2017, and another fatality occurred in Texas in 2020, the agency said in its latest update on the outbreak.
Government undermined financial education for children in England, Martin Lewis says 2024-03-05 17:30:00+00:00 - Martin Lewis, the financial advice expert, has accused the government of undermining his efforts to ensure children in England are taught about mortgages and credit cards, saying schools are suffering from a “poverty” of financial education. Addressing the education select committee, Lewis said the successful campaign he led in 2014 to add financial topics to the national curriculum has had little to show for it in the decade since. “Getting it on the curriculum was a pyrrhic victory. In some ways it was counterproductive,” Lewis told MPs. “We campaigned hard to get it on the national curriculum. We got it on the national curriculum in England. At that point, a lot of resources were pulled that had been voluntary and private sector. And then we had the change in the way that schools work – the academisation programmes, the free school movement – all of which means they don’t have to follow the national curriculum. “So the holy grail of trying to get it taught on a compulsory basis in every school, which is what getting on the curriculum was about, became self-defeating.” Lewis said that even those schools that did want to teach the topic were hampered by lack of resources and the failure to make the subject a high priority. “Frankly, the amount of resources the state and government has put in since then has been completely flaccid, and at a detrimental level. So while I can’t say that I regret we won the campaign at the time, I’m not sure it really changed the game in any way, because the rules were changed afterwards about what being on the national curriculum means, and I still think there is a real poverty of financial education in the UK. “Much of it comes down to a lack of resourcing for schools or lack of resourcing for teacher training and a lack of emphasis being put on this, for headteachers who are already overstretched.” Lewis said that where schools teach financial education, the topic is split between maths and citizenship classes. He called for schools to appoint a financial education coordinator to ensure it was being covered coherently in both areas. Damian Hinds, the schools minister, was asked by the committee if the government would expand financial education in primary schools to teach younger children. Hinds said there was already “explicitly” financial aspects of maths taught in infant school, but that there was a “further opportunity” to help teachers get better resources for the subject. “I want there to be more financial education. I would like for kids to say they had remembered it and had found it useful,” Hinds said.
Bitcoin rises above $69,000 in new record high 2024-03-05 17:19:00+00:00 - Bitcoin hit a record high on Tuesday as the price of the cryptocurrency rose above $69,000. The milestone eclipses a previous high-water mark that bitcoin set in November 2021, and comes after a long rally which has increased its value by 190% over the last year. The former record high for bitcoin was $68,990.90, according to the cryptocurrency news site CoinDesk. Bitcoin hitting its peak was followed almost immediately by a sharp drop off as the cryptocurrency fell back down below its opening price of about $66,000. The cryptocurrency’s record price marks a remarkable resurgence after a string of bankruptcies, fraud cases and crashes over the past two years. Several other cryptocurrencies, such as ethereum, have also increased their price amid a general rally in the crypto market. The surge coincides with US regulators approving a number of new exchange-traded funds earlier this year that track the price of bitcoin, some of which are being offered by big financial players such as Fidelity and BlackRock. Crypto advocates celebrated the Securities and Exchange Commission’s approvals as a sign of legitimacy and staying power. This week, the ETFs saw a spike in trading activity as the price of bitcoin grew. Bitcoin is also approaching an event known as the “halving”, which happens every four years and reduces the rewards for bitcoin miners in an attempt to control the overall supply of the cryptocurrency that is available to trade. Halvings generally give way to increased speculation around the cryptocurrency and activity from investors. Bitcoin has been historically extremely volatile, and the implosion of the major crypto exchange FTX in late 2022 after its CEO Sam Bankman-Fried committed multibillion-dollar fraud brought additional scrutiny to the industry. Bankman-Fried, once the face of crypto in the US, will face a potential 110-year maximum sentence for his crimes during a sentencing in March. There has also been increasing concern over cryptocurrencies’ environmental impact, and the US Department of Energy has recently faced off against the crypto industry as regulators attempt to investigate the technology’s immense energy consumption. The Securities and Exchange Commission has also filed lawsuits against multiple crypto exchanges – including Coinbase, the largest US exchange – alleging that they are selling unregistered securities. Lawyers for Coinbase argued earlier this year that cryptocurrencies should not be considered securities, and are closer to buying a collectible such as beanie babies. Bitcoin retained its value amid the various cryptocurrency scandals and investigations of the past year, however, as big investors bought up tens of millions’ worth of the token. Bitcoin advocates have argued that the emergence of ETFs and entrance of major financial firms would be a boon for the crypto industry, giving investors of all kinds more reason to purchase bitcoin and subsequently drive up the price. skip past newsletter promotion Sign up to Business Today Free daily newsletter Get set for the working day – we'll point you to all the business news and analysis you need every morning 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 The day before bitcoin reached its all-time high, gold futures also hit their own record peak. Gold futures ended Monday trading above $2,100, the highest since the introduction of the contract in 1974.
Labor Unions End Starbucks Board Fight 2024-03-05 17:12:23+00:00 - A coalition of labor unions said Tuesday that it had ended its boardroom fight with Starbucks after the coffeehouse chain agreed to negotiate labor agreements, a sign of progress after years of tumultuous relations between the company and its organized workers. The Strategic Organizing Center union alliance pulled its slate of three board candidates about a week before a March 11 shareholder vote on the 11-member board. The announcement comes more than two years into a campaign that has unionized nearly 400 Starbucks stores. On Tuesday, the alliance said it was “time to acknowledge the progress that has been made and to allow the company and its workers to focus on moving forward.” “We think it’s imperative that shareholders continue to monitor the board’s performance and Starbucks’ approach to labor relations issues in the coming months — and we plan to continue to hold the company accountable going forward,” the alliance said.
What is the best way to make council tax fairer for everyone? 2024-03-05 17:06:00+00:00 - There are two caveats to Aditya Chakrabortty’s excellent critique of the inequities of council tax (One simple change could restore faith in local democracy. But nobody is talking about it, 1 March). First, it’s unfortunate that he included “council houses … rotting in disrepair” in his litany of decay in the public realm. They may well be but, by law, spending on council housing is supported by tenants’ rents, not council tax. The trope about “housing on the rates” should be avoided; the housing revenue account has been ringfenced for more than 40 years now. Second, a 3% tax on disposable income is not a good substitute for council tax. The latter is indeed ill-designed and regressive, but there is nothing wrong with the principle that property as well as income should be taxed. Rather than adding to the marginal rate of income tax, there are many suggestions for more progressive property taxes, for example from the Wealth Tax Commission, which would support a more resilient tax base and greater fiscal choice at local level. David Griffiths Huddersfield, West Yorkshire Thank you, Aditya Chakrabortty, for focusing on the plight of local government – and those it serves. Which is all of us. In many poorer areas, however fairly the council tax bill is divided up, there are not enough wealthy people to fund the many vital services that local government is statutorily required to provide. That is why central government used to redistribute funds to help level the playing field. These have now gone, leaving ever more threadbare safety nets in their wake. Local government – and everyone it serves – deserves better. Cllr Trish Marsh Leominster, Herefordshire The best suggestion I’ve heard for a fairer council tax is to base it on a property’s value when it last changed hands. So someone whose house has risen in value, but whose income hasn’t, wouldn’t be hit punitively. But someone who could afford, or who inherited, the house next door would pay accordingly. Bernard Lyall London Aditya Chakrabortty is right about the inequity of council tax. However, there is one area of research that he does not mention. The council tax reduction scheme means that many of those on the lowest incomes can get a discount of up to 100% on their bill. So although the poorest 10% of households may face bills of more than 8% of their income, most of them should not have to pay this amount, as long as they make a claim to their local authority. Chris Willers Letchworth, Hertfordshire Aditya Chakrabortty refers to the very richest and includes in that “the people who own our talk-TV channels and sit on the boards of our academy trusts”. I am one of the trustees of a medium-sized multi-academy trust; our role (apart from the CEO, who is an employee of the trust) is purely voluntary and we receive no payment. We believe wholly in the concept of public service. However, I can confirm that I do not own a talk-TV channel. Carol Carlsson Browne Alresford, Essex To make a real difference, local authorities should be able to levy local income taxes, or directly receive an appropriate share of national income tax levied on their residents. An alternative is a local sales tax, but a direct tax is better. Prof Roger Brown Former civil servant working on local government finance
Chanel revisits Deauville roots with cinematic flair at Paris Fashion Week 2024-03-05 16:45:20+00:00 - PARIS (AP) — In a cinematic homage blurring fashion and film, Chanel transported its audience at Paris Fashion Week to a fictional Deauville for its latest showcase. The black and white film of the Normandy seaside town, starring Brad Pitt and front-row observer Penelope Cruz, evoked Chanel’s roots. Fusing the 1920s heyday of Gabrielle “Coco” Chanel with the drama of the ’70s, designer Virginie Viard recreated the founder’s gender-fluid wardrobe from the “winter sojourns by the sea.” Deauville changed the course of Chanel and arguably the Paris fashion industry. Here are some highlights of fall-winter 2024 ready-to-wear shows: DEAUVILLE, THE MOVIE Pitt and Cruz, depicted as lovers in the idyllic town, captivated guests who watched the romance unfold on giant plasma screens, with scenes of beach frolics and bonding over an order of medium-rare Chateaubriand steaks. Deauville, which influenced Viard’s fall aesthetic with its floppy beach hats, played a pivotal role in Chanel’s journey from licensed milliner to revolutionary designer. “Deauville is where everything started for the house,” Viard said. It’s where Chanel drew inspiration from the world around her: the salty and striped uniforms of the fishermen, the speed of horses at the racetrack, the chic madames sunning on the sands. “For this collection, we recreated the Deauville boardwalk,” Viard said, with chunky sailor sweaters, dressing gown-style belted coats and strong-shoulder peacoats. The colors evoked the hues of the town’s romantic skies with pinks, pale blue and oranges. Despite the poetical musing and finely proportioned coats, the penchant for accessories sometimes distracted from the garments and, at times, muddied the clarity of Viard’s vision. The setting evoked memories of a past spectacle by Karl Lagerfeld, her flamboyant predecessor, known for transforming the Grand Palais into a real beach with actual water. Some attendees felt the décor, and the clothes, this time lacked vibrancy by comparison. MIU MIU’S GROWING UP Miu Miu’s fall collection took a playful jab at the transition from childhood to adulthood. Miuccia Prada’s tongue-in-cheek little sister brand once again addressed profound themes through the lens of frivolity. Cropped sleeves, rounded-toe shoes and pajamas with outerwear amid exaggeratedly shrunken proportions evoked the Tom Hanks movie “Big.” Adulthood was seen as gloves and handbags, brooches, tailoring. The human condition, the pioneering designer seemed to say, was sometimes a fusion of both. Miu Miu’s creations consistently embody a youthful spirit, merging elegance with playful defiance. This is evident in unexpected styling choices like pairing sometimes clashing classic pieces with undergarments or athletic wear, challenging traditional fashion norms.
‘Bring back Thatcher’: voters in ‘blue wall’ voice scepticism before budget 2024-03-05 16:42:00+00:00 - In rain-lashed Sunbury, a picturesque commuter town strung out along the swollen River Thames, there is scant enthusiasm for the Conservatives ahead of Jeremy Hunt’s much-trailed pre-election budget – even among the party’s erstwhile supporters. Dodging the puddles, barrister Simon Wheatley, 67, describes himself as “traditionally Conservative; at the moment, undecided”. “I suspect I am so presently disaffected that I probably won’t vote,” he adds. Asked whether Hunt could tempt him with budget giveaways on Wednesday, he sighs. “My fear is that it’s become terribly political, and not necessarily with an eye to long-term economy”. View image in fullscreen Simon Wheatley, traditionally a Conservative voter, says he is unlikely to vote in the next general election. Photograph: Sean Smith/The Guardian Outside a nearby parade of shops, a sprightly grandmother, who declines to be named, describes the “real quandary” she faces in the general election as a Conservative party member. Sunbury sits in the ex-briefly-chancellor Kwasi Kwarteng’s constituency of Spelthorne, at the top of the M3. The 59-mile motorway, which carves its way south-west out of London, and in summer is thronged with weekenders heading for the New Forest and the coast, tells a tale of the UK’s changing political landscape. En route to the northern edge of Southampton, it passes through a string of other Tory seats, some of which have not changed hands for many years. These bustling commuter towns and cities, with their rural hinterlands, were not the battlegrounds of the last general election in 2019, when the action was concentrated hundreds of miles north, in the “red wall”. But while the Conservatives may well be safe in Spelthorne, where Kwarteng is stepping down, the election battles in at least three of the constituencies along the M3 corridor – Surrey Heath, Basingstoke and Winchester – will be hard-fought. Prof Will Jennings, from Southampton University, an elections expert, says: “That sort of M3 corridor – call it the blue wall, call it just the south of England – is home to the sorts of demographic that are increasingly challenging for the Conservatives. “They used to be areas that were affluent, car-owning, employed. Those demographics, through the period of political change we’ve seen over the last five years, since Brexit, have drifted away from the Conservatives. It doesn’t mean all these seats are going to go red and orange but it does mean that the Conservatives are going to have some real fights on their hands.” A short drive down the M3 from Sunbury, at the Lib Dems’ constituency HQ in Camberley town centre, parliamentary candidate Al Pinkerton, an academic at Royal Holloway, University of London, is ready for one such battle. The levelling up secretary, Michael Gove, has not yet been confirmed as the candidate here, in his Surrey Heath constituency – but Pinkerton and his team have spoken to about 3,000 voters since the new year. View image in fullscreen Al Pinkerton, the Lib Dems’ candidate in Michael Gove’s Surrey Heath constituency, says some voters have said they will back the rightwing Reform party. Photograph: Sean Smith/The Guardian He says they are hearing the same laments repeatedly – about the state of the NHS, the cost of living, sewage in the rivers, and a broader mistrust of politicians – including, he says, some people saying they will back the rightwing Reform party. “People used to say about Surrey, it was the old joke, stick a blue rosette on – insert farmyard animal here – and it would win. It’s just not the case. Even though we have fought hard for that change, it’s happened remarkably quickly.” He points to the change of control on Surrey Heath borough council, which the Lib Dems took over from the Tories last May, after a series of risky investments blew a hole in the finances. As to whether Hunt could win plaudits in a constituency like this one with a giveaway budget – evidently the hope at Westminster – Pinkerton is sceptical. “I don’t know, I don’t have a crystal ball. But when I speak to people, they have tax cuts baked into their thinking, and they reserve the right not to be persuaded by it.” Another half an hour south-west, the M3 skirts the southern edge of Basingstoke constituency, which has been Conservative since 1924, barring a year in the noughties when the sitting MP quixotically joined the Democratic Unionist party (DUP). Its MP, Maria Miller, calls Basingstoke the “economic powerhouse of Hampshire”. She points to recent government spending in the town, which has expanded dramatically in recent decades. And she highlights a statue of local hero Jane Austen – who spent more time there than in Bath, she says – which Miller raised the funds to erect. View image in fullscreen Maria Miller, the Conservative MP for Basingstoke, says the town has had massive investment in its roads and schools. Photograph: Sam Frost/The Guardian “We’ve had massive investment in our roads, in our schools. What we want to do now is to make sure that the NHS, which is probably the bit of public services that finds it most difficult to expand, can catch up,” she says. “What I think people in Basingstoke will be looking for from the budget is how they can get to keep more of the money they earn. The cost of living is a significant pressure in the south-east.” Some voters tell a different story. Just around the corner from the Austen statue, in the historic town centre, ultra-runner Adam McCartney, 40, has just bought a head-torch for a round-the-clock competition. “I feel like it’s got more run down, especially at this end of town. The shopping centre could do with filling up: that is a bleak place to be. When it first opened, every one of those units was filled, and now it’s very much not,” he says. View image in fullscreen Adam McCartney says Basingstoke has got more run-down, with empty units in the shopping centre. Photograph: Sam Frost/The Guardian “It’s been a steady decline. Over the past few years it feels like it’s accelerated. It feels like the incumbent Tory regime have just left it to it – they’ve abandoned it and thought, ‘there’s just enough there to keep people going, so we’ll leave them to it’.” The newly selected Labour candidate, Luke Murphy, lists a by-now familiar series of issues that come up in his doorstep chats. “GP appointments, registering with dentists, the state of the top end of town. It’s just people’s day-to-day experience.” Murphy acknowledges he has a tough challenge if he wants to unseat Miller, pointing out that a Labour win here would be historic. The swing required, of 12.2%, is strikingly similar to the 12.7% average shift his party would need nationwide to win a majority, according to recent research by veteran election-watchers Colin Rallings and Michael Thrasher. On a walkabout through the Festival Place shopping centre, Murphy is greeted by Deborah Reavell, 77, who says she is “excited” about the election, and highlights the gaps in NHS services. “Well, that’s universal isn’t it? You have to use Dr Google, and sort yourself out.” View image in fullscreen Luke Murphy, the Labour candidate for Basingstoke, with voter Deborah Reavell. Murphy acknowledges he has a tough challenge trying to win in the traditional Tory stronghold. Photograph: Sam Frost/The Guardian Twenty miles to the south-west of Basingstoke is the historic city of Winchester, home to the prestigious public school that educated Rishi Sunak. This affluent, semi-rural constituency returned a Labour MP in Clement Attlee’s postwar landslide, and was Lib Dem from 1997-2010, but since then has been solidly Tory. With boundary changes drawing in parts of neighbouring MP Flick Drummond’s seat, she will stand here for the Conservatives, while the incumbent, the former health minister Steve Brine, is standing down. View image in fullscreen Paul Morgan says Winchester is thriving because of its close proximity to London. Photograph: Sam Frost/The Guardian Paul Morgan, the managing director of office supplies company Warrens Office, says Winchester is thriving. “I think we’re insulated from other parts of the UK because we’re only an hour from London,” he says, highlighting the bustling high street, increasingly a leisure destination. “I think a lot of people are high earners, connected with London. They may drive around in a 20-year-old Volvo but they’ve got cash on deposit and they’re insulated. So I think we’re not representative of the rest of the UK.” Despite being relatively upbeat about the outlook, he is scathing about the Tories’ record. “The Conservatives have lost the right to govern, based upon their current performance,” he says. “What the Conservatives have missed as an overarching principle is that they should be the party of lower taxes.” View image in fullscreen Danny Chambers, the Lib Dem candidate for Winchester, says voters would rather issues with public services were fixed than the government announced tax cuts. Photograph: Sam Frost/The Guardian And while Morgan is no fan of Labour – “I can’t think of a situation where they’ve left the country, after a period of government, in a better state than when they started” – he thinks some voters here will either abstain, or switch to the Lib Dems. “But that’s not based on desire, it’s based on the least worst option.” The Lib Dem candidate, Danny Chambers, a vet who specialises in treating horses, says his many conversations with voters have highlighted the same concerns echoed up and down the M3 corridor – a deep mistrust of politicians and despair at the state of public services, especially the NHS – which appear unlikely to be patched up by a single budget, however generous. “They just feel taken for granted; they feel like no one’s ever knocked on their door before, no one’s ever cared. I think people are desperate for better public services, and that’s everything from roads that don’t have potholes in it, to a sewage system that’s not leaking stuff into rivers, to NHS care. People would rather get the mental health care they need for their kid, who’s struggling, or the social care for their grandad, than a tax cut.” Back on Winchester high street, Geoff Evans, 72, laments the current crop of politicians – on all sides – as the worst he’s seen in his lifetime. “Professional politicians, they haven’t got a clue. Half of them haven’t got the common sense they were born with,” he says. “I hate to say it, but the best thing, if it would ever be possible, is to bring back Margaret Thatcher.”
Middle East Starbucks cuts 2,000 workers amid Gaza war boycotts 2024-03-05 16:41:00+00:00 - Starbucks' Middle East franchisee is laying off roughly 2,000 workers at its restaurants throughout the region as it grapples with ongoing boycotts of the brand over the Israel-Hamas war. The Starbucks operator cited business conditions as behind its decision to fire just over 10% of its workforce in its Middle Eastern and North African locations. "As a result of the continually challenging trading conditions over the last six months, we have taken the very sad and very difficult decision to reduce the number of colleagues" in Starbucks stores in the region, the Kuwait-based family business, Alshaya Group, told the Associated Press. The layoffs were first reported by Reuters. Alshaya operates roughly 1,900 Starbucks stores in Bahrain, Egypt, Jordan, Kuwait, Lebanon, Morocco, Oman, Qatar, Saudi Arabia, Turkey and United Arab Emirates. Starbucks is one of a number of Western brands that have drawn criticism from pro-Palestinian activists since Hamas' October 7 attack on Israel. McDonald's has also faced boycott campaigns from both pro-Palestinian and pro-Israel groups over their perceived stance on the conflict, while activists have also targeted Burger King, KFC and Pizza Hut, among other chains. McDonald's CEO Chris Kempczinski said in January that the fast-food chain is seeing a "meaningful business impact" in the Middle East and elsewhere related to the Israel-Hamas war. McDonald's also faced boycott calls after a local franchisee in Israel in October said it would distribute free meals to Israeli soldiers. Rumors that Starbucks financially backs the Israeli government and its military are "unequivocally false," the company states on its website. As a public company, Starbucks is required to disclose any corporate giving, it notes. A Starbucks employee in Glen Rock, New Jersey, in February found red paint and antisemitic stickers related to the Israel-Hamas war on the shop's sign, police said. The Seattle-based company also sued Workers United over a pro-Palestinian message the union posted online. —The Associated Press contributed to this report.
Meta platforms experienced significant outage on Super Tuesday 2024-03-05 16:29:00+00:00 - Facebook, Instagram and other Meta platforms suffered a significant outage on the morning of Super Tuesday that now appears to be resolved. Experts at three organizations that monitor internet traffic, Kentik, NetBlocks and ThousandEyes, confirmed that Meta’s various companies — Facebook, Instagram, Threads and Messenger — experienced a major drop in traffic Tuesday morning. The outage, which spanned multiple countries, was related to how users log in, Netblocks said, and it appeared that many Facebook users had been logged out of their accounts. At the time of the outage, Meta's servers were still online and reachable, ThousandEyes said, indicating that the problem was most likely a backend service issue. Some of those services, especially Facebook, are used by major political campaigns, and the outage may have prevented them from engaging with constituents on Super Tuesday, when 16 states and one U.S. territory hold presidential primaries, and five states hold Senate, House, governor and local primaries. Meta spokesperson Andy Stone indicated on Tuesday afternoon that the issue was resolved. “Earlier today, a technical issue caused people to have difficulty accessing some of our services,” he wrote on X. “We resolved the issue as quickly as possible for everyone who was impacted, and we apologize for any inconvenience,” he said. In a media call with reporters about the election, a senior official from the Cybersecurity and Infrastructure Security Agency said the agency was aware of the outage. “We are aware of the incident and at this time we are not aware of any specific election nexus or any specific malicious cyber activity,” the official said. Some of the traffic began to come back after about an hourlong outage, said Doug Madory, Kentik’s director of internet analysis, and some users reported being able to log back in. Intermittent disruptions of even major websites are often a configuration issue and are usually quickly solved. It wasn’t immediately fully clear what Meta’s issue was. Meta's own status page, which gives updates on which of the company's products are experiencing outages, didn't load for a period on Tuesday morning, but now says its services are all recovering from disruption or that the issues are resolved.
CrowdStrike shares surge on earnings beat, strong full-year guidance 2024-03-05 16:16:00+00:00 - George Kurtz, co-founder and chief executive officer of Crowdstrike Holdings Inc., during a Bloomberg Technology television interview at the RSA Conference in San Francisco, California, US, on Wednesday, April 26, 2023. CrowdStrike shares surged as much as 21% in after-hours trading Tuesday, after the cybersecurity company reported a beat on the top and bottom lines, and issued stronger than expected guidance for the upcoming quarter and full year. Here's how the company did, compared to LSEG, formerly Refinitiv, consensus estimates: Earnings per share: 95 cents adjusted versus 82 cents expected 95 cents adjusted versus 82 cents expected Revenue: $845 million versus $839 million expected For the period ended Jan. 31, CrowdStrike saw net income of $54 million, or 22 cents per share, from a $48 million loss, or a 20 cent loss per share, in the year ago period. CrowdStrike has now reported GAAP net income for the last four quarters, CFO Burt Podbere said in the earnings release. Full-year revenue rose 36% year-over-year, from $2.24 billion to $3 billion. The company also announced it would acquire Flow Security for an undisclosed price in a cash-and-stock deal, slated to close in the company's fiscal first quarter. The company has been stepping up its M&A activity in recent months. "CrowdStrike is cybersecurity's consolidator of choice, innovator of choice, and platform of choice to stop breaches," co-founder and CEO George Kurtz said in a release. The company also guided to fiscal first-quarter revenues between $902 million and $906 million, better than a consensus estimate of $899 million. CrowdStrike also expects EPS for the period between 89 to 90 cents, better than the 82 cent consensus estimate. Podbere also reiterated the company's focus on achieving $10 billion in annual recurring revenue by 2030. The company reached $3.4 billion in ARR in January.
First Solar CEO says tariff exemptions threaten U.S. efforts to ramp up domestic solar manufacturing 2024-03-05 16:15:00+00:00 - In this article FSLR TAN Follow your favorite stocks CREATE FREE ACCOUNT A worker applies tape to a solar panel at First Solar in Perrysburg, Ohio July 8, 2022. Megan Jelinger | Reuters A flood of foreign solar components threatens efforts to build a domestic manufacturing base in the U.S. to support the clean energy transition, according to First Solar CEO Mark Widmar. In an interview with CNBC, Widmar said the U.S. should close tariff exemptions that allow cheap components into the U.S. market. First Solar is the largest manufacturer of solar panels in the U.S., focused on large, utility-scale projects. "All we want is to be able to compete on our own merits and to the extent there is dumping happening in the U.S. market, it should be addressed," Widmar said. "Once it is addressed, we want it to be enforced." A common type of solar panel used in the U.S. is excluded from Section 201 tariffs designed to protect domestic solar manufacturing, and a moratorium on tariffs against solar components imported from several Southeast Asian nations is in place. While some industry stakeholders have supported these exemptions to help scale up solar power capacity in the U.S., Widmar said the carveouts are undermining the goals of the Inflation Reduction Act. Exploiting a loophole "The intent of what we're trying to do – to create this domestic industry that can enable long-term energy independence and security to achieve climate change goals and to enable cycles of innovation by having domestic capabilities – is all at risk," Widmar said. "It's unfortunate but that's largely what's happening." The Biden administration in 2022 extended Section 201 tariffs originally imposed by the Trump administration, but imported bifacial solar panels, which absorb light on both sides, are excluded from the duties. In an investigation concluded last August, the U.S. Commerce Department found that some Chinese companies were skirting anti-dumping protections in the U.S. by shipping solar cells and modules through countries such as Cambodia, Malaysia, Thailand and Vietnam. But a decision by President Joe Biden in June 2022 to exempt those same Southeast Asian nations from solar tariffs for two years means penalties are not being enforced against some Chinese producers despite the Commerce Department's conclusions. Biden vetoed legislation last spring that would have imposed tariffs on solar components from Cambodia, Malaysia and Thailand. In his veto message, the president described the exemption as a "temporary bridge" that is needed to help expand solar capacity in the U.S. Though the exemption expires this June, Widmar said 30 to 40 gigawatts of excess product has made its way in to the U.S. market, which is equivalent to almost a full year of consumption. "What this is doing is it's not allowing these domestic companies to scale," Widmar said. The First Solar CEO said he is also worried that Chinese companies will exploit IRA tax credits, particularly the 7 cents per watt for solar modules, to set up assembly plants in the U.S. that do not move the ball forward in terms of technological innovation. "What you've done is you've given the Chinese the opportunity to exploit the Inflation Reduction Act," Widmar said. A White House spokesperson wasn't immediately available to comment. A buffer against volatility First Solar is largely insulated from the current market dynamics because the company is booked solid through at least 2026, Widmar said. The company has intentionally overbooked to provide a buffer against the volatility in the solar market, he said. While the residential solar sector has been walloped by high interest rates, First Solar has outperformed with its focus on utility-scale projects. The Invesco Solar ETF (TAN) has fallen than 18% this year, while First Solar's stock is down just over 6%.
Cava Group Serves Up 60% Gain Amid Strong Post-IPO Buying 2024-03-05 16:15:00+00:00 - Key Points Cava Group stock is currently trading about 4% below its February 29 high of $59.84, finding support 6.1% above its 10-day moving average, a bullish sign. Strong demand in the restaurant industry supports the performance of Cava and other fairly new stocks such as Wingstop and Shake Shack. Cava Group earnings beat analyst expectations since going public. 5 stocks we like better than CAVA Group Restaurant stocks have defied expectations of inflation-induced decline and are among the market's top performers. Mediterranean restaurant chain Cava Group Inc. NYSE: CAVA is one of the industry's standouts, returning 60.96% in the past three months. The Cava chart shows the stock is actionable, trading about 4% below its February 29 high of $59.84. Get CAVA Group alerts: Sign Up Cava stock is finding support 6.1% above its 10-day moving average, suggesting some profit-taking after a big recent rally rather than a rush for the exits. Cava went public at $15 in June and has shown typical post-IPO price action. After rallying to a high of $58.10 in early August, Cava stock pulled into a correction. In this case, the pullback was fairly steep, at 47%, likely due to the relatively small market capitalization and limited number of shares in float, both of which contribute to volatility. Cava Stock Formed Post-IPO Consolidation After an IPO, stocks retreat as initial excitement subsides and early investors take some profits. Sometimes, a post-IPO pullback coincides with a broad market downturn. In Cava's situation, the stock began selling off in tandem with the broader market in August 2023. Cava stock returned to rally mode in October as the market also rallied. The AdvisorShares Restaurant ETF NYSEARCA: EATZ corrected more than the broader market between mid-August and mid-December 2023. Cava is a component of that ETF, an actively managed fund whose largest holdings include Wingstop Inc. NASDAQ: WING, Shake Shack Inc. (NYSE SHAK), US Foods Holding Corp. NYSE: USFD, Casey’s General Stores Inc. NASDAQ: CASY and Brinker International Inc. NYSE: EAT. Wingstop, Shake Shack Among Top Restaurant Stocks The ETF holds stocks of companies that derive at least 50% of their net revenue from the restaurant business, defined as restaurants and companies that supply the industry. It's up 14.19% in the past three months. Wingstop and Shake Shack have been central to the ETF's performance, as they've returned 50.93% and 73.94%, respectively, in the past three months. When a stock belongs to a strong-performing industry, it often indicates favorable market dynamics and growth prospects. That’s the case with the restaurant industry, which is experiencing strong demand. According to 2023 data from the U.S. Census Bureau, Americans spend 20% more at restaurants than grocery stores. Comparing Industry Stalwart with an Upstart That type of industry-wide trend tends to lift the stocks of companies executing well. Among consumer discretionary stocks, McDonald’s Corp. NYSE: MCD is the largest restaurant stock in the Consumer Discretionary Select Sector SPDR Fund NYSEARCA: XLY. McDonald's has returned 2.25% in the past three months. However, it's tough to compare a veteran company like McDonald's with younger, smaller, more agile companies like Cava, Wingstop and Shake Shack, all of which are in growth mode. At the same time, McDonald's was considered a mature company decades ago. MarketBeat's Cava Group earnings data show the company has been beating analysts' net income views since going public. Cava earnings have been increasing much faster than McDonald's, which is a comparison just to highlight the growth rate of a recent IPO. That fast growth is particularly true of a new stock in a hot industry, which restaurants represent now. Attracting Attention from Big Investment Banks The Cava Group analyst forecasts show a consensus of “moderate buy.” For a new company, Cava has attracted attention from some big investment banks, including Goldman Sachs, Citigroup and Morgan Stanley. That indicates that institutional investors are interested in a particular stock and that investment banks anticipate business from the company. On January 24, Argus initiated coverage of Cava with a “hold” rating. "The company, in our view, appears poised to take advantage of growth opportunities in its targeted Mediterranean niche as well as in the fast-casual segment of the restaurant industry," Argus analysts wrote. Analysts' Robust Long-Term Growth Forecast They cited a profitable business model, a clean balance sheet and an experienced management team as strengths, adding that they forecast long-term growth of 20%, a robust rate. They added that shares appear fairly valued at $46, whereas Cava stock trades just shy of $58. The consensus price target is $55.10, a downside of 5.02%, indicating that other analysts also believe the price has gotten a little frothy lately. Before you consider CAVA Group, you'll want to hear this. MarketBeat keeps track of Wall Street's top-rated and best performing research analysts and the stocks they recommend to their clients on a daily basis. MarketBeat has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market catches on... and CAVA Group wasn't on the list. While CAVA Group currently has a "Moderate Buy" rating among analysts, top-rated analysts believe these five stocks are better buys. 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Nordstrom shares fall 10% as retailer warns of potential sales declines in 2024 2024-03-05 16:05:00+00:00 - Shoppers exit the Nordstrom at the Westfield Topanga mall in Los Angeles on Aug. 14, 2023. Nordstrom's holiday-quarter sales topped Wall Street's expectations on Tuesday, but the retailer gave a muted outlook for the year ahead. The Seattle-based company said it plans to open new Nordstrom Rack stores and drive higher online and in-store sales in the coming year. Yet it said full-year revenue, including retail sales and credit cards, will range from a 2% decline to a 1% gain compared with the previous year. That forecast includes a more than 1% hit from having one fewer week in the fiscal year. Nordstrom said it expects earnings per share of between $1.65 and $2.05 for the full year. That would be higher than its most recent fiscal year, which saw earnings per share of $1.51, the retailer said Tuesday. Shares of Nordstrom fell about 10% in extended trading following the report. Here's what the department store operator reported compared with what Wall Street was expecting, based on a survey of analysts by LSEG, formerly known as Refinitiv: Adjusted earnings per share: 96 cents vs. 88 cents expected Revenue: $4.42 billion vs. $4.39 billion expected Like other retailers, Nordstrom has felt the squeeze from consumers becoming choosier and more price-conscious while dealing with inflation and higher interest rates. It has also struggled with company-specific problems, such as lagging sales at its off-price retailer, Nordstrom Rack, and too much of the wrong inventory, which led to higher levels of markdowns. In the fiscal quarter that ended Feb. 3, Nordstrom's quarterly revenue rose about 2% from $4.32 billion in the year-ago period. It attributed approximately $190 million of those sales to having an extra week in the fiscal year. Nordstrom's net income rose to $134 million, or 82 cents per share, from $119 million, or 74 cents per share, a year earlier. Excluding a supply chain impairment charge and other adjustments, earnings per share were 96 cents. Net sales for the company's namesake banner declined 3% in the fourth quarter compared with the year-ago period. That includes a 4.1% lift from the extra week of the fiscal year. The company's winddown of its Canadian business took a bite out of sales, however, causing net sales to drop by more than 3%. The company announced a year ago that it would shut down its stores and online operations in Canada. Nordstrom Rack, the company's off-price brand, was the strongest performer in the holiday quarter. Its net sales rose 14.6%, including a 5.8% boost from the extra week in the year. In the fourth quarter, women's apparel, beauty and the active category had the strongest growth year over year. Online sales dropped 1.7% in the fourth quarter compared with the year-ago period. E-commerce represented 38% of total sales during the quarter, down from 40% in the same period a year earlier, and 36% for the fiscal year, down from 38% in fiscal year 2022. As of Tuesday's close, Nordstrom shares are up about 6% over the past year. That's underperformed the approximately 25% gains of the S&P 500. Nordstrom's stock closed on Tuesday at $20.90, bringing the company's market value to about $3.4 billion. This is breaking news. Please check back for updates.
Jeremy Hunt to cut national insurance by 2p in budget 2024-03-05 16:03:00+00:00 - Jeremy Hunt is to cut national insurance by 2p in his budget on Wednesday, the Guardian understands, in a move designed to offer voters a pre-election giveaway but which could mean steeper spending cuts after the election. The UK chancellor is preparing to announce the second big cut to employment taxes in a year, after his decision to cut national insurance rates by 2p at last year’s autumn statement. Wednesday’s move should save the average earner £450 a year, which combined with last year’s cut will add up to £900. However, the chancellor has been looking at further public spending cuts after the election as one way to pay for the tax reduction, despite economists’ warnings that such a move would cause public services to buckle. Hunt and the prime minister, Rishi Sunak, have spent the last few weeks looking for ways to offer a tax cut on the scale of that announced last year as a way to boost the Conservatives’ flagging poll ratings in their last budget before an election. Sunak had urged the chancellor to focus on reducing income tax instead, which is more costly to cut but better understood by most voters. Since last year’s national insurance cut, the party’s poll deficit has widened by one point from 19 points to 20. Treasury officials said, however, that any personal tax cuts should be focused on working people. Sunak also appears to have been persuaded by the fact that unlike income tax, which is partly devolved in Scotland, national insurance is a UK-wide tax. The prime minister told reporters in Scotland last Friday: “I’m very conscious that, whilst the SNP is making life harder for hard-working people by putting their taxes up, I want to make life easier for people.” Conservative whips have been told to prepare to rush through emergency legislation after the budget, something that would be needed to enact a national insurance cut. Sunak promised to reduce income tax rates when he was chancellor, but this was reversed by Hunt in his first autumn statement in 2022 as the government scrambled to undo the damage done by his predecessor Kwasi Kwarteng’s “mini budget” a few months earlier. While a cut in national insurance would on its own save workers hundreds of pounds a year, the effect of the tax cut would be outweighed by the Treasury’s decision to freeze the salary thresholds for both national insurance and income tax in cash terms. Calculations by the Resolution Foundation show that only those paid between £27,000 and £59,000 a year will be better off as a result of both the autumn statement and Wednesday’s budget, once the freeze in thresholds are accounted for. Those paid £16,000 will lose almost £500 a year, as will those receiving more than £60,000. Government sources say forecasts provided by the Office for Budget Responsibility last month provided the chancellor with about £13bn to spend before breaking his promise to have debt falling as a percentage of economic output in five years’ time. Hunt is expected to announce a series of revenue-raising measures on Wednesday to help pay both for the cut in NI, which would cost about £10bn a year, and for another freeze in fuel duty, which would cost another £5bn. Measures that have been discussed include limiting tax breaks to non-doms, introducing a levy on vaping products, increasing taxes on short-term holiday lets, extending the energy windfall tax and increasing taxes on business-class flights. Calculations by Labour suggest these measures could cumulatively raise a further £5bn. The chancellor has also been considering reducing the forecasts for public spending after the election. The forecasts set after the autumn statement assumed departmental budgets would rise 1% above inflation each year during the next parliament, but Hunt has been looking at bringing that down to 0.75%. Such a move would raise between £5bn and £6bn a year. But economists have warned such it would also mean cutting the budgets of unprotected departments, including justice, local government and the Home Office, by about 20% over the course of the parliament.
Target launches paid membership program as it chases new revenue streams 2024-03-05 15:59:00+00:00 - Target on Tuesday said it will launch a paid membership program next month, riffing off the playbook of its rivals Amazon and Walmart. The subscription tier, Target Circle 360, will include unlimited free same-day delivery for orders over $35 in as little as one hour with no delivery fees and two free-day shipping, along with other perks. The paid membership tier will launch in early April and cost $49 per year, said Cara Sylvester, Target’s chief guest experience officer. She announced the program at an investor event on Tuesday in New York City. The retailer will also relaunch its free Target Circle loyalty program, which debuted in 2019, to make it easier to use and more personalized. For example, members who belong to the free program will have discounts automatically applied rather than having to scan through deals on the app, she said. The big-box retailer is turning to the new revenue stream as it tries to boost weaker sales. Its fiscal fourth-quarter earnings and revenue reported Tuesday beat Wall Street’s expectations, but its comparable sales have declined three quarters in a row. With the move, Target is also following in the footsteps of retailers that have turned membership fees into a money maker and a sales driver. Amazon launched its Prime program in 2005, with perks like free two-day delivery and streaming of popular movies and original TV shows. It costs $139 per year or $14.99 per month, with the video membership-only option of $8.99 per month. Walmart launched its program, called Walmart+, in 2020. It costs $98 per year or $12.95 per month, with perks like free shipping, free grocery deliveries for orders of at least $35 and gas discounts. Target is turning to its competitors’ playbook for a reason: Walmart CEO Doug McMillon told investors on the company’s earnings call in February that Walmart+ members spend nearly twice as much as non-members and buy more over the course of a year. Walmart has not said how many people subscribe to Walmart+, but its CFO John David Rainey said on the earnings call that its membership continues to grow by double-digit percentages.
Gitlab Goes on Sale: The AI Bubble Burst for This Stock 2024-03-05 15:55:00+00:00 - Key Points Gitlab's guidance failed to inspire the market, but the price decline and reset outlook have it set up to rebound later this year. The company sustains double-digit growth and is widening its margin. Analysts reaffirm their outperform ratings and set price targets 20% above the new low. 5 stocks we like better than GitLab Gitlab’s NASDAQ: GTLB Q4 results and guidance failed to satisfy the market expectations, sending the stock down 20%. The takeaway is that an AI-fueled bubble burst for this market, but the story is not over. As tepid as the guidance may be, the comps to consensus are overshadowed by sustained high-level growth and margin improvement, with analysts reaffirming their ratings and an outlook for share prices to rebound. The share price may wallow in calendar Q1 and Q2, but signs of support are already on the chart, so a deeper correction is unexpected, and a rebound is likely. It will take time, but Gitlab’s share price will recover as the company grows into its valuation and may even set new highs this year. Get GitLab alerts: Sign Up Gitlab Fails to Meet Inflated Expectations Gitlab had a solid quarter and exceeded the consensus forecast on the top and bottom lines, but some details hurt the price action, primarily the valuation. The stock was trading about 350X the fiscal 2024 earnings estimate and 150X fiscal 2025’s ahead of the report, and the performance and guidance do not live up to those figures. The $163.8 million in revenue beat the consensus, but the 350 basis points of outperformance are not that great given the market. Most AI-related companies outperform by low single digits, and the leaders by more, and growth is decelerating. The 33.3% posted in Q4 is better-than-expected but aligns with the prior quarter, and the guidance is weak. Guidance suggests growth will slow by 500 basis points in fiscal 2025. Details that suggest a rebound will occur include the outlook for sustained double-digit growth and widening margin. The company’s RPO increased by 55% on increased subscriptions and licenses driven primarily by large customers. Enterprise-scale clients contributing more than $1 million in trailing ARR are leaning into the DevSecOps platform and have increased their business by 52% YOY. Smaller businesses contributing more than $100,000 and $5,000 are up by 37% and 23%, respectively. Margin news is another bright spot in the report. The company improved its margin on top-line growth and penetration. The net retention rate is 130% and is expected to remain strong this year as new products and features are rolled out. The company continues to report GAAP losses but reached cash-flow neutral operations a year ahead of schedule and reported an adjusted profit. The adjusted 8% operating operating margin is up 1900 basis points for the quarter and is expected to remain positive in F2025. Guidance Derails the Uptrend in Gitlab Guidance is the primary cause of the stock price implosion. The company guided for 25% YOY revenue growth but missed the top and bottom lines consensus. Analysts expected to see $0.30 in adjusted earnings this year, and the company forecasted $0.19 to $0.23. The takeaway is that analysts' sentiment was overzealous, and the market reset. The company’s guidance may be cautious, so there is a chance it could improve its outlook as the year progresses. Regardless, sustained double-digit growth and a pivot to profitability is good news for any tech stock. Analysts' activity is mixed following the report, with one boosted price target offset by another lowered one. However, the two analysts making early calls reaffirmed Outperform-equivalent ratings and see the stock trading in the $74 to $75 range. That’s 10% above the consensus target and 20% above the current action. The market is down and may have trouble regaining footing soon, but support is present. The market fell to a significant resistance level broken late last year, presenting an attractive entry point for new money this year. If this level continues to provide support, it will confirm a Head & Shoulders Bottom. This bottom has an upward bias with rising support and may continue to complete a reversal. In that scenario, a move back to the $75 level would lead to a new high and an uptrending market. Before you consider GitLab, you'll want to hear this. MarketBeat keeps track of Wall Street's top-rated and best performing research analysts and the stocks they recommend to their clients on a daily basis. MarketBeat has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market catches on... and GitLab wasn't on the list. While GitLab currently has a "Moderate Buy" rating among analysts, top-rated analysts believe these five stocks are better buys. View The Five Stocks Here
Klarna CEO says AI can do the job of 700 workers. But job replacement isn't the biggest issue. 2024-03-05 15:50:00+00:00 - Fintech company Klarna, which powers e-commerce transactions for some of the world's most recognizable brands, including Expedia, Macy's and Nike, is at the forefront of AI adoption. It has integrated artificial intelligence across the company, most notably with an AI chatbot that it recently said does the equivalent work of 700 customer service agents. Klarna, which employs roughly 4,000 people, recently released statistics that show how efficient and effective the tool has been, wading into the thick of sensitive and high-stakes debates about the role of generative AI in business, how humans interact with it and its implications for the future of work. CEO Sebastian Siemiatkowski explains why he is so transparent about AI's capabilities, and what concerns him most about the new technology. This interview has been edited for length and clarity. Klarna CEO Sebastian Siemiatkowski said the advent of AI in the workplace "isn't something that's happening in the future — it's happening now." Bloomberg AI's takeover of human jobs is a touchy topic. Why did you choose to publicly share data on Klarna's use of AI to replace customer service agents? We worry in general about the effects this may have on society, so we decided to be upfront about the fact that it has had some amazing outcomes for customers. It is currently doing the equivalent work of about 700 full-time [customer service] agents. Klarna does not employ customer service agents ourselves, we use some of the large customer service providers out there. They're outsourced — they are not employees. We made the announcement to say the consequence of us launching the technology is we need the equivalent of 700 fewer full-time agents than what we usually use on an average basis. On average, we need 3,000 agents, now we need a little more than 2,000. We wanted to make policymakers aware that this isn't something that's happening in the future — it's happening now. We think it is critical that society start thinking about this major change. So this isn't related to the layoffs Klarna conducted in 2022? AI didn't take those jobs? In 2022, as a consequence of a change in investor sentiment, we had to reduce the size of our company. We reduced our staff by around 800 people. None of [the people we laid off] were customer service agents. Now, two years later, we are looking at this interesting technology we've developed with ChatGPT. These are two totally separate things that have been conflated. In the short-term, there are no layoffs or implications for employees as a result of us launching this customer service AI chatbot. What does the chatbot do? How do you measure its success? It handles two-thirds of our customer service chat inquiries. It's on par with humans in terms of satisfaction and it resulted in a 25% reduction in repeat inquiries from customers. Before we took this live, we already had a co-pilot that helped customer service agents and other employees accelerate their work. This AI actually communicates and resolves customers' issues on its own. We think it's important that people are still given the option to speak to a human, but we're also seeing that people who choose to interact with the AI chatbot are very happy and find it helpful, to the point and effective. It can communicate in 35 languages, so for many immigrant and expat groups, it means a huge improvement in their experience. In large organizations, less time is spent on what really creates value for employees, customers and shareholders. With AI, it's the less-productive work that can be taken away. In the best of worlds, everyone who comes into the company will be able to use their creative power to create real value for customers — and not to write an impressive presentation for its CEO. That's less of a value add; it's specifically that kind of work I hope to shrink. Do you worry about it making mistakes or delivering inaccurate information? One has to remember that unfortunately, it's not like we humans are perfect. Humans are fantastic but they also make mistakes, either because they didn't [give a query] proper attention or get training, and it's not always their fault. The point is, it does happen, especially when doing millions of customers' inquiries, some aren't as good as you'd like them to be. The key metric we use is making sure it makes fewer mistakes, on average, than humans do. That's the objective and it's something we've been monitoring very closely. We make sure the AI's mistakes are less severe and less common. How has AI changed your approach to hiring, if at all? We've stopped hiring in the last six months. We're shrinking as a company, not by layoffs, but by natural attrition. Klarna tries to apply AI across all products and services and work we do. It's having implications on how many people we need as a company. This is one time that a single product improvement led to a massive reduction in need for customer service agents. How do your employees feel about this? As much as it's not easy to not talk about it, we want to be honest and transparent and tell people about it because of the implications for society. As far as our own employees go, we have been trying to communicate this internally since we stopped recruiting in October — that we believe this will allow us to do more with less. Our ambition is to invest more per employee and to see the compensation of existing employees go up as we become a higher-revenue company. Internally, lots of employees have been excited about AI and are applying it and Klarna, which is known as a leading AI company, which I think makes our workers more attractive to other employers. How did you reach your estimation of AI's $40 million in cost savings to Klarna? We were buying customer service from suppliers to take care of inquiries. We had an amount budgeted for how much we were going to spend with those suppliers this year. Now, thanks to the technology, we will spend much less. Forty million is the delta between what we expected to spend and what we will actually spend. What do you think the larger of implications of AI for society will be? We are sharing this information to pose the question, to society at large, of how we are going to manage this massive change. From what I've heard, it's less about job security and more about general security, as in, we'll need electronics IDs to know that we are in fact humans talking to one another. Also, while new [AI-related] jobs may be created on a societal level, that's not a solve for the individual [who is replaced by AI]. The better we as a society can support individuals who may be affected, the more positive a development it will be. The idea is not to stop it; I don't think that's right. The question is, 'What support can we give people who are affected by it?'
Fed Chair Powell testifying to House on Wednesday. What investors are expecting 2024-03-05 15:49:00+00:00 - Jerome Powell, chair of the Federal Reserve, during a House Financial Services Committee hearing in Washington, D.C., on June 21, 2023. Nathan Howard | Bloomberg | Getty Images Federal Reserve Chairman Jerome Powell heads to Capitol Hill on Wednesday with markets intent on getting more clarity about how the central bank plans on proceeding with monetary policy this year. The past several months have seen a changing dynamic between financial markets and the Fed over the pace and timing of expected interest rate cuts this year. Markets have had to adjust their collective view from a highly accommodative central bank to one that's more cautious and deliberate. With his congressionally mandated testimony coming before the House on Wednesday and the Senate on Thursday, Powell will be tasked with providing a sharper view — and not rocking the boat for a nervous Wall Street. "The question now for the market is to glean any information on when the Fed will begin employing rate cuts and how many," said Quincy Krosby, chief global strategist at LPL Financial. "He's not going to answer that necessarily. But if there is any change, any nuance, that is what the market wants to see." Central to the question of how the Fed acts from here on out is its view on inflation and how Powell expresses that. In recent weeks, he and others have expressed satisfaction with the trend in prices along with apprehension that risks still lurk, saying it's too early to ease up on monetary policy. Markets currently anticipate the Fed will begin cutting in June and enact the equivalent of four quarter-percentage-point cuts in total this year, according to futures market pricing gauged by the CME Group. Policymakers in December indicated three cuts and mostly have avoided providing a timetable. Mixed signals complicate the message On the inflation issue, the data had been cooperating for the most part. Inflation readings in the latter part of 2023 showed a clear trend toward the Fed's 2% target. However, January brought a jolt, showing that consumer prices, particularly in shelter costs, remained stubbornly higher and posed a threat to the trend. Powell will have to synthesize the recent trends carefully as he speaks first to the House Financial Services Committee on Wednesday, then the Senate Banking Committee the day after. "The message very much is not going to be 'mission accomplished,' but 'we've made a lot of progress, we anticipate rate cuts are coming,'" said Joseph LaVorgna, chief economist at SMBC Nikko Securities. "That to me is what I think will be the central message." Powell's testimony before Congress comes at a ticklish time for markets: After breaching historic highs, major stock averages have sold off this week amid ongoing concern about where rates are headed and a suddenly uncertain outlook for a few of the Big Tech names that have been driving prices higher. Both conditions are concerning for policymakers. Big jumps in risk asset prices could reflect loose financial conditions that might cause the Fed to hold tight on policy, while a less certain environment could raise fears about staying too high for too long on rates. Powell "cannot deviate at all from the 'data-dependent, but we really want to cut rates' approach the Committee has committed to," wrote Steven Ricchiuto, U.S. chief economist at Mizuho Securities. "Sharp swings in financial conditions can easily work at cross-purposes to the Committee's objective: maintaining tight labor market conditions while also keeping inflation expectations and long-term rates well anchored," he said, referring to the policy-setting Federal Open Market Committee. Political concerns
Royal Caribbean cruise employee arrested after hidden camera found in guest bathroom on Symphony of the Seas 2024-03-05 15:45:00+00:00 - A Royal Caribbean cruise employee has been arrested after allegedly setting up hidden cameras inside passenger bathrooms to spy on young girls. Arvin Joseph Mirasol, 34, a citizen of the Philippines, was arrested Sunday after a guest aboard the Symphony of the Seas cruise ship found a camera in her bathroom on Feb. 25. The guest, who was staying in a room with her sister and mother, found the hidden camera when she reached under the sink to grab a roll of toilet paper and found the camera "affixed to the counter underneath the sink," the probable cause affidavit said. She reported the camera to customer services, and ship security responded to the room. Symphony of the Seas on approach to the Strait of Gibraltar on March 24, 2018. Julien Rambaud / Sipa USA via AP file Mirasol, an attendant who services the cabin by cleaning, replacing towels and making the bed, was detained on the ship until it docked at Port Everglades in Fort Lauderdale, Florida, on March 3. Once the ship docked, Homeland Security Investigations, Customs and Border Protection and the Broward County Sheriff’s Office were alerted and spoke with security and Mirasol. His electronics, including his phone, an SD card, camera, and USB stick, were investigated that same day. On the USB stick, law enforcement discovered "numerous videos of naked females undressing" as well as child pornography, the criminal complaint affidavit said. One video showed Mirasol himself installing a camera into a guest room's bathroom. Mirasol admitted in a post-Miranda interview to taping a video camera in guests’ bathrooms when he worked as an attendant and said he'd pleasure himself after retrieving the camera and viewing its footage, the affidavit said. “Mirasol revealed that he has been placing these cameras in the bathroom since he started working on Symphony of the Seas around December 2023,” the filing said. He told officers, “I want to control it, but I can’t,” the affidavit said. He said he'd place the cameras in the rooms where there were females 16 years old and older, despite knowing it is illegal to film underage girls. Mirasol also admitted that while guests were taking a shower, he’d enter the rooms and hide under the bed while recording them naked with his phone, the affidavit said. Mirasol has been charged with six state charges of voyeurism in Broward County. In the U.S. District Court of Florida, he was further charged with production and possession of child pornography. NBC News has reached out to the public defender who was appointed to his case. Royal Caribbean said in a statement: “We have zero tolerance for this unacceptable behavior. We immediately reported this to law enforcement and terminated the crew member, and we will continue to fully cooperate with authorities.”