Japan's Nikkei 225 surpasses all-time high reached in 1989
Pedestrians in Tokyo observed a surge in the value of shares on Japan's Nikkei 225 on February 22, 2024. The Nikkei 225 surpassed its all-time peak during trading, briefly reaching 39,029, exceeding the previous record set in 1989. The rally was driven by a rise in chip stocks, particularly after US chipmaker Nvidia reported strong earnings. The market had a successful year in 2023, with the Nikkei up 28%, and so far in 2024, the index has jumped 17%. The weak yen is a key factor in driving the stock market up, benefiting Japanese exporters and making shares cheaper for foreign investors. Demand for AI is also boosting the outlook for Japanese technology companies. To sustain the rally, Japan will need to deepen its corporate governance reforms to enhance shareholder returns.
China's economic troubles are hurting global banks
One of the branches of HSBC in Hong Kong was pictured on February 19, 2024. HSBC reported a significant decline in quarterly profit due to a $3 billion hit on its stake in China's Bank of Communications and charges related to exposure to the country's troubled real estate industry. The bank's pretax profit dropped by 80% in the last three months of 2023 compared to the same period in 2022. The impairment of $3 billion was calculated after a December evaluation, which included an estimate of future cash flows at BoCom. Additionally, HSBC made provisions of $3.4 billion to cover expected credit losses and other charges related to its exposure to the commercial real estate sector in mainland China. Despite the challenges, the bank maintained a positive view on China's economy. Other European lenders have also been impacted by China's property woes.
Mortgage rates rise to 6.9% in third-straight increase
An aerial photo of a housing subdivision in Las Vegas, taken on Feb. 8, 2024, shows the layout of the neighborhood. Mortgage rates have increased for the third consecutive week, nearing 7%. The average 30-year fixed-rate mortgage was 6.90% in the week ending February 22, up from 6.77% the previous week and 6.50% a year ago. Despite smaller fluctuations in rates over the past two months, recent indications from the Federal Reserve have led to higher mortgage rates. Strong economic and inflation data has influenced this trend, causing concern for homebuyers in already unaffordable markets. The potential impact of these rising rates on the housing market is being closely monitored.
AT&T customers report a massive outage. Verizon and T-Mobile are also down for some
AT&T experienced network issues on Thursday morning, causing disruptions for customers trying to make calls, send texts, or access the internet. Verizon and T-Mobile also had some reported network outages. Over 31,000 AT&T customers reported outages on the DownDetector website. The company has been responding to customer complaints online but has not officially acknowledged a network outage. There have been sporadic outages over the past few days, including a temporary 911 outage in some southeastern US areas. Verizon and T-Mobile also had around 1,000 reported outages. The cause of the service disruption is unknown, and it is unclear how many people have been affected. Downdetector provides real-time status information for various services worldwide. This is an ongoing situation and will be updated.
America is on the cusp of a new biggest credit card company. Here's what it could mean for you
Capital One is set to acquire Discover Financial Services in a $35.3 billion deal, potentially disrupting the credit card industry. If the acquisition is approved, Capital One will become the largest US credit card company by loan volume. While immediate changes for customers are not expected, there could be significant transformations in the future, such as more businesses accepting Discover cards. The acquisition would also give Capital One a competitive edge against other credit card-issuing banks. However, consumers may end up paying higher interest rates if all Capital One credit cards are switched to Discover, potentially impacting fees for balances owed. Democratic Sen. Elizabeth Warren has criticized the deal as harmful to working people and urged regulators to block it. Increased competition could benefit Visa and Mastercard by potentially influencing legislation aimed at reducing fees collected from merchants.
Boeing removes head of 737 Max program in wake of safety incidents
In 2019, a photo showed Boeing 737 MAX airplanes parked at the Boeing Factory in Renton, Washington. Executive Ed Clark, who led the 737 Max program, was removed by Boeing after a series of issues including deadly crashes and a recent midair blowout. The 737 Max has faced problems over the past five years, including a grounding in 2019 and 2020 after two crashes. A recent incident involved a door plug blowing out on an Alaska Airlines Boeing 737 Max, with the NTSB finding that bolts were missing from the plug. Boeing CEO Dave Calhoun took responsibility for the incident, stating that Boeing is accountable for what happened. This is an ongoing situation and will be updated as more information becomes available.
Preparing for war, social unrest or a new pandemic? Chinese companies are raising militias like it's the 1970s
More than 500 new recruits of the People's Liberation Army (PLA) were photographed on September 15, 2020 in Kunming, Yunnan province. China's volunteer brigades provide support to the PLA. Several major Chinese companies, including a privately-owned dairy giant, have recently established their own volunteer armies known as People's Armed Forces Departments. These civilian units, made up of individuals who maintain their regular jobs, serve as a reserve and auxiliary force for China's military and are available for various missions. The revival of corporate militias is seen as a response to potential conflicts abroad and social unrest at home, exacerbated by economic challenges and the COVID-19 pandemic. These units, operating within China, are under military leadership and are aimed at integrating economic development with national security. The establishment of these corporate brigades reflects Beijing's increasing focus on maintaining control and stability in society.
Teamsters strike Molson Coors as it prepares to walk out at Anheuser-Busch next week
A strike by more than 400 Teamsters at the Molson Coors brewery in Fort Worth, Texas is affecting production for the second largest brewer in North America. The union is unhappy with the company's offer, which they consider inadequate given Molson Coors' strong financial performance. The strike comes ahead of a deadline set by the Teamsters for a potential strike at Anheuser-Busch, the nation's largest brewer. Molson Coors has stated that it has contingency plans in place to minimize the impact of the strike on consumers.
Bitcoin stages a $1 trillion comeback
The value of Bitcoin has skyrocketed to $52,000 since November 2022, surpassing $1 trillion in market capitalization. Investors have flocked back to Bitcoin recently, with the rise attributed to the launch of exchange-traded funds. Despite the surge, Bitcoin remains below its all-time high of $69,000 in 2021, but experts believe it will continue to climb. The upcoming halving event, which reduces the rate of new coins entering circulation, is expected to further boost Bitcoin's value. However, investors should be aware of the risks associated with investing in Bitcoin, as it is volatile and closely monitored by regulators.
Former Rep. George Santos sues late night host Jimmy Kimmel for allegedly "deceiving" him into creating Cameo videos
In a recent lawsuit, former Congressman George Santos accused Jimmy Kimmel of deceiving him into making personalized Cameo videos, which were then broadcast on national television and social media without permission. The lawsuit, filed in New York, alleges copyright infringement, fraudulent inducement, breach of contract, and unjust enrichment. Santos is seeking damages and injunctions to prevent further copyright infringement. Kimmel, ABC, and Disney are named as defendants in the case.
Hirotake Yano, Japanese billionaire founder of 100-yen chain Daiso, dies at 80
Hirotake Yano, the Japanese billionaire who founded Daiso Industries and popularized the concept of discounted dollar shops, has passed away from heart failure. He died in Hiroshima on February 12, as announced by the company on Monday. Yano had a net worth of approximately $1.9 billion at the time of his death. He started his entrepreneurial journey after graduating from Chuo University in 1967, opening a small shop selling products for 100 yen. He officially established Daiso in 1977, with the name translating to "creating something big." The chain has become a global retail empire, with over 4,360 stores in Japan and more than 990 overseas stores as of 2023. Daiso expanded internationally in 2001, with branches in Taiwan and South Korea, and further grew its presence in countries like Australia, Indonesia, Saudi Arabia, and the United States. The company reported sales of over 550 billion yen ($3.6 billion) as of February 2022. Daiso's success led to the emergence of similar 100-yen retailers in Japan, such as Seria and Can Do. In 2018, Daiso introduced a higher-priced Threeppy store offering home furnishings and acquired the Japanese budget retailer CouCou in 2020.
Five moves Walmart is making to overhaul its business for the future
Walmart, a global retailer established in Arkansas in 1962, is undergoing significant changes in 2024 with investments in technology and inventory that will introduce new business ventures and alter the shopping experience for many customers. The company's fourth quarter earnings, to be released soon, will provide insight into the success of these changes. CEO Doug McMillon is expected to further elaborate on Walmart's new strategies. Additionally, Walmart is increasing pay for some of its workers in response to past criticism about worker compensation. The company is also undergoing a billion-dollar store makeover program, featuring changes such as relocating pharmacies and widening aisles. Walmart has recently announced a 3-for-1 stock split and raised the average pay for store managers. The retailer is also focusing on technology initiatives, including artificial intelligence implementation and drone delivery. Walmart has made adjustments to its in-store shopping experience, such as offering sensory-friendly hours and introducing in-store samples to attract customers. Despite economic challenges, Walmart's stock is performing well and its e-commerce and advertising business is expected to continue growing in 2024.
Israel's economy slumps in the fourth quarter as war takes a toll
The Israel-Hamas war has caused a significant decline in Israel's economy, with businesses in Sderot closing as a result. Israel's GDP fell by 19.4% in the last quarter of 2023, with the conflict expected to cost the country around 255 billion shekels by 2025. The Bank of Israel predicts a 13% impact on GDP, leading to a downgrade in credit rating by Moody's. Despite some signs of recovery, there are concerns about further escalation and potential involvement of other militant groups like Hezbollah.
The Alaska Air flight was terrifying. It could have been so much worse
A loud noise and a massive hole opened up in the side of an airplane shortly after takeoff, causing chaos in the cabin. Despite the terrifying experience, no one was seriously injured or killed on Alaska Airlines flight 1282 on January 5. The incident was caused by missing bolts on the door plug of the Boeing 737 Max 9, which had flown 153 flights before the mishap. Luck was on the side of the passengers and crew as the plane was still at a low altitude, empty seats were near the opening, and the door plug did not cause further damage when it blew away. The situation could have been much worse if the incident had occurred at a higher altitude, during a longer flight, or if the door plug had hit essential parts of the aircraft.
Here's what the Starbucks of the future looks like
Starbucks has opened a new cafe in Washington, DC, designed to provide customers with disabilities a more accessible experience, as part of a broader initiative to create inclusive retail spaces. The company is implementing softer lighting, improved acoustics, and reduced clutter to make navigation easier for all customers. Other retailers have also started to consider the needs of customers with disabilities, with some implementing sensory-friendly hours and other accommodations. Starbucks' inclusivity framework will be made available to the public to help expand accessibility in the retail industry. The company has faced criticism in the past from disability rights activists but remains committed to inclusivity and improving accessibility in its stores. The goal is to ensure that physical and digital Starbucks environments meet a higher standard of accessibility by 2030. The company also supports efforts to expand and strengthen the Americans with Disabilities Act, including eliminating a provision allowing employers to pay disabled workers less than minimum wage. This systemic and policy-oriented approach is seen as a positive step towards creating a more inclusive economy.
Frustrated White House sends letter to press corps, skewering coverage of Biden's handling of classified files
President Joe Biden expressed his frustration with recent press coverage in a letter to the White House Correspondents' Association. The letter, written by Ian Sams, spokesperson for the White House Counsel's Office, raised concerns about how the media has covered Special Counsel Robert Hur's report on Biden's handling of classified material. Sams acknowledged that covering the report is challenging due to its length and complexity, and criticized the news outlets for reporting inaccuracies and false content. The White House is particularly frustrated with the portrayal of the report as concluding that Biden intentionally mishandled classified material, when the actual report is not so clear. Sams pointed out that Hur provided plausible explanations for Biden's behavior that rebut the notion of intentional lawbreaking. The White House has been pushing back against press narratives about the report and engaging in disputes with reporters behind the scenes. Legal experts, including Andrew Weissmann and Ryan Goodman, have also criticized the press coverage of the report. The White House hopes to influence future coverage by urging caution and attention to detail.
A US productivity boom may explain how inflation slowed amid a strong economy
An employee is putting together a product at the Intervala manufacturing plant in Mount Pleasant, Pennsylvania, US, on January 30, 2024. It is anticipated that inflation will return to normal without causing a recession, thanks to recent productivity growth. The strong US productivity in the previous year allowed for wage increases without passing on the costs to consumers, as workers were producing enough to cover higher labor costs. Productivity is crucial for economic and inflation trends, and recent advancements may have been due to the adoption of generative artificial intelligence and companies becoming more efficient in anticipation of a potential recession. However, measuring productivity accurately is challenging, especially in a services-based economy like the US. While last year's productivity surge may have contributed to a smooth economic transition, it remains uncertain if it signifies a lasting shift in the economy.
Leading tech firms pledge to address election risks posed by AI
A group of leading tech companies, including OpenAI, Google, Meta, Microsoft, TikTok, and Adobe, have pledged to work together to combat the potential harm caused by artificial intelligence (AI) in elections. They have agreed to collaborate on technology to detect misleading AI-generated content, including deepfakes of political candidates, and to be transparent about their efforts. The agreement comes as regulators have been slow to create regulations for AI technologies. The companies also plan to educate the public on how to protect themselves from being manipulated by AI-generated content. However, some civil society groups believe that the agreement is not sufficient and that stronger measures, such as human review and enforcement, are needed.
New York City sues social media platforms over youth mental health crisis
New York City is taking legal action against several social media networks, including TikTok, Instagram, Facebook, Snapchat, and YouTube, claiming that their platform designs harm the mental health of young users and cost the city $100 million annually in related health programs and services. The lawsuit alleges that these platforms contribute to an increase in mental health issues among young people, such as depression and suicidal thoughts, which places a significant burden on the city's mental health services. This lawsuit follows congressional hearings where social media executives faced scrutiny over the negative impact of their platforms on younger users, particularly teenage girls. Other families, states, and municipalities have also sued social media companies over the alleged harm to children's mental health. New York City aims to secure monetary damages and equitable relief to support prevention education and mental health treatment. Additionally, the city has released a social media action plan to hold these companies accountable, provide education and support to young people and families, and study the long-term effects of social media on youth. The social media platforms, including Snapchat, Meta (parent company of Instagram and Facebook), TikTok, and Google (parent company of YouTube), have responded by highlighting the measures they have implemented to support young users and their parents. However, in the US, it is challenging to sue social media platforms due to a federal law called "Section 230," which protects tech companies from liability for user-generated content. In contrast, the EU's Digital Service Act allows for lawsuits against companies that violate the law, potentially resulting in significant financial penalties.
Ozempic, Mounjaro and hundreds of other drugs become even more expensive in 2024
The list prices of the popular diabetes medications Ozempic and Mounjaro, which are also used for weight loss, have been increased along with around 900 other brand-name medications in January. The median increase for these drugs was 4.7%, which is slightly lower than previous years but higher than the inflation rate. Novo Nordisk raised the list price of Ozempic by 3.5% to $969, while Eli Lilly increased the list price of Mounjaro by 4.5% to $1,069. These price increases may affect uninsured individuals or those who have not yet reached their annual deductible. However, both companies offer savings cards and patient assistance programs to help reduce out-of-pocket costs for certain individuals. While GLP-1 drugs like Ozempic and Mounjaro are often covered by insurance for diabetes treatment, they are less likely to be covered for weight loss. Efforts are being made to expand insurance coverage for anti-obesity medications. The high cost of medications in general is a significant issue for many Americans, even those with insurance. Some individuals have had to make tough choices and prioritize certain medications due to their high costs. President Joe Biden has made reducing drug costs a key focus of his campaign.
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