Aviva CEO Amanda Blanc Says Sexism in Finance Has Got Worse

Will Louch and Olivia Konotey-Ahulu
Thu, May 12, 2022



(Bloomberg) -- Aviva Plc Chief Executive Officer Amanda Blanc said that the sexism she encounters has worsened as she has risen through the ranks in finance.

Blanc became the insurer’s first female chief executive in July 2020 but faced a number of offensive comments from shareholders at the FTSE 100-listed firm’s annual shareholder meeting on Monday. These included individual shareholders telling Blanc that she was “not the man for the job” and questioned whether she should be “wearing trousers.”

Blanc responded to the comments yesterday in a post on LinkedIn where she said that after working in the financial services industry for more than 30 years she was “pretty used to sexist and derogatory comments,” like those that were made at the AGM.

“I guess that after you have heard the same prejudicial rhetoric for so long though, it makes you a little immune to it all,” Blanc wrote in the post. “I would like to tell you that things have got better in recent years but it’s fair to say that it has actually increased - the more senior the role I have taken, the more overt the unacceptable behaviour.”

She said that usually derogatory comments were made in private and the fact people were making these comments in public was a new development for her personally.

Blanc became the government’s women in finance champion in March last year, as part of an initiative urging firms in the City to commit to boosting gender diversity. It will take the financial services industry another 30 years to achieve gender parity at senior levels, according to research published by the Women in Finance Charter in 2022.

Blanc is one of the few female chief executives of a listed company in Europe, with only 7% of firms in the region’s richest nations led by women according to a report by European Women on Boards, or EWoB, in January. In 2021, just eight organizations had promoted women to the top job since the previous year.

Hedwige Nuyens, chairwoman of the EWoB, commented in response to Blanc’s statement on LinkedIn on Wednesday, “This must stop. It is disgraceful, unacceptable. Let’s focus on the persons that really matter, bringing added value to the firm as responsible stakeholders.”

Sexism scandals have flared in the financial services sector in recent years. The insurance industry has come under particular scrutiny for how female employees are treated. A 2019 Bloomberg investigation uncovered evidence of endemic sexual harassment at Lloyd’s of London, the world’s oldest insurance market, including inappropriate comments, unwanted touching and sexual assault. Earlier this year, Lloyd’s fined Atrium Underwriters more than a million pounds for failing to address complaints of harassment and bullying.

CRYPTO CRASHES
England's crypto club takes plunge into the unknown

Thu, May 12, 2022,


So, an American consortium has bought an English soccer team with the ultimate aim of winning the Premier League title.

Nothing especially new there, right?

Well, when it comes to the recent purchase of Crawley Town, an unheralded club located 28 miles (44 kilometers) south of London, there’s a huge catch.

“The Dallas Cowboys of the NFL are America’s Team — no matter where you live in America, there are always Dallas Cowboy fans,” said Preston Johnson, one of the businessmen fronting WAGMI United’s acquisition of the team which plays in England’s fourth division. “We want it to be wherever you live, if you have an internet connection, you are a Crawley Town FC supporter.”

That’s because WAGMI United is a group of investors pledging to “shake up the status quo” by using the world of cryptocurrency and “Web 3” technology to fuel the rise of a sports team.

Cryptocurrency is a kind of digital money — bitcoin is the best-known example — that use decentralized databases known as “blockchains” to record encrypted transactions. Web 3 is a trendy technology term used to describe an idealistic goal for a more democratic internet enabled by the growing use of blockchains and blockchain-based items such as nonfungible tokens, known as NFTs.

Cryptocurrency's rising popularity — and meteoric increase in value — has been viewed with widespread skepticism because it is unregulated, making it ripe for wide-eyed speculation among unsophisticated investors and market manipulation by scam artists.

By purchasing Crawley Town, WAGMI United is among about a dozen American owners in English soccer but the group is believed to be the first from the crypto space to buy an entire professional sports team.

“That crypto, NFT, Web 3 audience … doesn’t have a sports team yet,” Johnson told The Associated Press on a video call. “We can give the internet a team … it’s Crawley Town FC.”

Innovation is at the heart of what’s being described by some as an “experiment” on a 126-year-old club that has an average attendance of about 2,200 spectators and a reach that barely extends outside Crawley — a town of 114,000 best known for being the home of Gatwick Airport and rock band the Cure. It's also where England national team coach Gareth Southgate grew up.

The soccer team made the headlines in 2011 when, as a non-league team, it was drawn to play Manchester United in one of the biggest mismatches in the history of the FA Cup. After a pre-match controversy involving a Crawley fan who mocked the plane crash that killed much of the Man United team in 1958, United won 1-0 in a game between two teams nicknamed the “Red Devils.”

Among the ideas of WAGMI United, whose range of investors and advisors includes Philadelphia 76ers general manager Daryl Morey and entrepreneur Gary Vaynerchuk, is using the sale of NFTs to generate extra revenue streams and give buyers voting rights and the chance to have a say on some of the decisions made about the club.

Johnson, a former sports betting analyst, and Eben Smith, a former derivatives trader who is the co-founder of WAGMI United, are targeting promotion to the third division within two years. In order to have full accountability, they say if that objective is not achieved, fans will be able to vote for a change of directors from among the ownership group.

For Johnson, the plan is to invest in analytics, sports science, sports psychology and nutrition to get an edge on opponents. He also spoke of setting up a fan council.

Using the crypto world to expand the fan base and give supporters — local or digital — a greater attachment to the club is at the heart of WAGMI United’s vision, however.

“This whole Web 3 movement is just a matter of time and it’s going to exist,” Johnson said. “It will be a part of everything, whether it’s sport, the music industry, entertainment, as well as art, which we’ve seen in the last year.

“I think it’s here to stay and we want to be the ones to help bridge crypto and NFTs with sport.”

The first NFT drop is scheduled to happen some time this month and Johnson — the face of WAGMI United, at least when comes to Crawley — spoke about “paying homage to some of the NFT historical art of the past” by putting one of those designs on the front of the shirt instead of a traditional sponsor.

Johnson has just moved from his home in southern California to Crawley and will be there practically full time through at least the summer to take a hands-on role. It’s that kind of openness and engagement that has been welcomed by the club’s fans, even if there were — and likely still are — concerns about having owners from crypto space, which remains a mystery to so many.

What might also be alarming is the price of bitcoin, the best-known cryptocurrency, falling sharply since April.

“The word ‘experiment’ has been used quite a lot,” said Sam Jordan, chairman of the Crawley Town Supporters Alliance, “and that does scare a lot of fans, to be honest. But if the experiment pays off, then fantastic.

“It could go one of two ways. It was always going to happen at some point to a football club. We are the chosen football club.”

Jordan said “apprehension is slowly turning into cautious optimism” about the buyout, despite knowing little about NFTs and crypto.

However, he did call for “someone with football experience” to help the consortium run the club and for assurances about what happens if the crypto “dries up.”

“Does the club get pulled,” Jordan asked, “and we just drop back down like a ton of bricks?”

Johnson was eager to stress that WAGMI United acquired Crawley in cash and there was a requirement for the consortium to “overcapitalize,” covering expected losses for the next two years.

“Some people have the idea we’re buying it with coin that can go way up or way down and the club could be in financial ruin if it tanks,” Johnson said. “That’s not the case. We’re not dependent on selling NFTs to let the club run on an ongoing basis.”

It’s still a plunge into the unknown for Crawley, with critics raising ethical and financial concerns about cryptocurrency and questioning whether the new owners' motivation will wane if, for example, their NFTs don’t sell. This is, after all, a club with deep links to the local community and more than a century of heritage, even if that has been solely in the lower echelons of the English game.

It’s over, then, to the new owners to prove that Crawley is not just a plaything. And it’s been a difficult start for them.

They had to make the first big call of their tenure by firing the team's manager, John Yems, last week following allegations he used discriminatory language and conduct toward the squad, including discouraging Black players from using the same locker room as whites. Yems is currently under investigation by the English Football Association. Without a manager, Crawley lost three of its last four games, drawing the other one, to finish the League Two season in 12th place in the 24-team division.

This has to be about the bigger picture, though, for WAGMI, which stands for “We’re All Gonna Make It." And climbing the English pyramid to get into the promised land of the Premier League for the first time is the aim, even if Johnson struck a note of caution.

“That’s the goal,” he said, “but we are cognizant of the fact that when you get to the (second-division) Championship, everyone overspends because of that chance to get to the Premier League.

“We need to have a structural foundation that’s really strong so we can sustain at Championship level. We recognize it’s a very difficult task. We think over the next 7-10 years, getting to the Championship is at least reasonable.”

___

More AP soccer: https://apnews.com/hub/soccer and https://twitter.com/AP_Sports

Steve Douglas, The Associated Press

Volkswagen's EV profit margins to match combustion engines sooner than planned - CEO


Thu, May 12, 2022, 

BERLIN (Reuters) - Volkswagen expects its electric vehicle business to be as profitable as its fossil fuel-burning cars sooner than planned, its chief executive Herbert Diess said on Thursday.

Volkswagen previously expected to match its profit margins from combustion engine vehicles with electric vehicle sales in two to three years, but the carmaker was in a robust financial position to do so sooner, Diess said, despite a challenging economic environment.

"We expect that the e-mobility business will be as profitable as the combustion engine business earlier than planned," Diess said, speaking alongside the rest of the board at the carmaker's annual shareholder meeting.

"Through good crisis management, we are financially robust and have strengthened our resilience."

Diess intends for Volkswagen to overtake Tesla and become the world's number-one electric carmaker by 2025, building on its bigger product offering covering luxury and premium cars and volume brands.

Volkswagen delivered some 452,000 battery-electric vehicles globally last year and aims for half of its global output to be all-electric by 2030. It plans to build 800,000 fully electric cars worldwide this year and 1.3 million in 2023, it said on Thursday.

Prices may need to increase further this year amid rising raw material costs, procurement chief Murat Aksel said.

Diess also said he thought the timing was ideal for an initial public offering (IPO) of sports carmaker Porsche, which is planned for the fourth quarter of this year.

A final decision on whether Porsche would enter Formula 1 was still outstanding, the sports carmaker's chief Oliver Blume said.

Volkswagen said in April that it and the Porsche and Audi brands were open to entering the international racing class, but Diess said last week there were some divisions among the board but that the brands had ultimately made the case for the move.

(Reporting by Victoria Waldersee, Editing by Rachel More and Emelia Sithole-Matarise)

CRIMINAL CAPITALI$T

The SEC is investigating Elon Musk over his late disclosure that he had purchased Twitter stock, a report says

Isobel Asher Hamilton
Thu, May 12, 2022,

Elon Musk.Andrew Kelly/Reuters

• The SEC is investigating Elon Musk's late disclosure of his Twitter stake, per The Wall Street Journal.

• After buying up more than 5% of Twitter stock Musk should have filed a disclosure on March 24.

• He filed on April 4, meaning he may have benefitted from buying up cheaper shares in the meantime.

The Securities and Exchange Commission (SEC) is investigating Elon Musk over his disclosure of buying up Twitter shares ahead of his announcement that he wanted to buy the company, The Wall Street Journal reports.

Sources familiar with the matter told The Journal the SEC is probing Musk over his late submission of a form investors need to file when they purchase more than 5% of a company's shares.

Musk filed the form at least ten days after the date when he was supposed to, The Journal reports.

Musk disclosed on April 4 that he had bought up a 9.2% stake in Twitter, sending the social-media company's shares soaring by almost 25%.

According to SEC rules, he should have filed his disclosure by March 24, The Journal reported.

By not reporting that he'd bought a more than 5% stake in time, he potentially saved $143 million. This is because if public investors had known earlier that Musk was buying up stock, the share price may have gone up, University of Pennsylvania accounting professor Daniel Taylor told The Journal.

A Twitter shareholder filed a lawsuit against Musk on April 12, which claimed that investors would have made significant gains between March 24 and April 4 if he had reported his disclosure on time.

Musk offered to buy Twitter on April 14 and the company accepted his bid on April 25. The deal still needs to pass shareholder and regulatory approval.

Even if the SEC brought a lawsuit against Musk it would be unlikely to upset the deal closing, The Journal reported.

The SEC did not immediately respond to Insider's request for comment made outside of normal working hours.

China’s White Knight Tycoon Can’t Save His Own Firm From Default

David Scanlan
Thu, May 12, 2022, 3:00 a.m.·4 min read



Major China Developer Sunac Defaults as Debt Crisis Spreads


(Bloomberg) -- Sun Hongbin, dubbed the “white knight” in China for bailing out fellow billionaires and their empires, was unable to rescue his own from the property crisis that’s engulfing the world’s second-biggest economy.

Though he dipped into his own pocket to the tune of $450 million, tapped investors to buy shares and raised more than $2 billion in all, it wasn’t enough for Sun to avoid default at his Sunac China Holdings Ltd.

Sunac joins more than a dozen developers including China Evergrande Group that have defaulted on dollar bonds in the past few months, potentially inflicting more pain on global high-yield investors.

The struggles at Sunac -- China’s No. 4 developer by sales -- may herald further distress among property firms that were deemed too strong to fail just a few months ago. They also underscore how developers are straining under Beijing’s crackdown on borrowing and a housing slump that’s being made worse by strict Covid restrictions.

“Sunac’s default means that no private Chinese developer is now safe from default this year” without new financing, said Wei Chong, head of bond research at Fuhui Juli Wealth Management Corp., a hedge fund that owned Sunac’s onshore debt before selling earlier this year.

Sunac declined to comment.

For Chairman Sun, 58, the default is another setback in a roller-coaster career that’s included a separate failed property firm, a stint in prison over embezzlement charges for which he was later exonerated, and a meteoric rise to found one of the country’s biggest developers. He amassed a $12 billion fortune along the way.

Just a few months ago, Sun’s company was projected to be one of the survivors of China’s moves to reduce risk in the financial sector by limiting developers’ ability to borrow in public markets. Sunac, with Harvard University-educated Sun as its biggest shareholder, was rated BB as recently as March last year at S&P Global Ratings, two notches below investment grade. The dollar bonds that slipped into default traded at 82 cents on the dollar in December.

Sunac’s sales blossomed to about 230 billion yuan ($34 billion) in 2020, a 10-fold jump from 2015 as it benefited from surging demand in its top-tier markets of Shanghai and Beijing. The firm ranked third by contracted sales last year, according to China Real Estate Information Corp., a position it maintained in the first two months of 2022 before slipping to fourth. That growth made Sunac a stock darling for a time, gaining more than 400% in 2017 alone.

That lofty perch made Sun popular among tycoons in need.

When China’s Tesla Inc.-wannabe LeEco had cash-flow problems, Sun offered a lifeline of $2.5 billion to founder Jia Yueting’s operations. In 2017, Sun agreed to buy hotels and theme parks from Dalian Wanda Group Co. for more than $6 billion after China planned to cut off funding for billionaire Wang Jianlin. Sun also came close to buying Kaisa Group Holdings Ltd. when the troubled developer defaulted on offshore debt. He later dropped the deal.

Yet Sunac’s massive spending spree and expansion into sectors ranging from indoor ski hills to amusement parks has been raising eyebrows for years. The investments in businesses unrelated to property, which included a struggling internet company, prompted Fitch Ratings to cut the firm deeper into junk status in 2017, citing what it called its “acquisitive business approach.”

“He’s quite gung-ho,” said Cheng Wee Tan, an analyst at Morningstar Inc. “He’s always been relying on a strategy of aggressive expansion funded by leverage.”

As the liquidity crunch deepened last year following Beijing’s crackdown, Sun took steps to bolster Sunac’s balance sheet, determined to avoid a repeat of a failed property firm known as Sunco that he ran more than 15 years ago.

Sun, a U.S. citizen, dipped into his own coffers to provide a $450 million interest-free loan to Sunac, which also raised $580 million in a January stock sale and unloaded a stake in its property-services unit.

Bonds Tumble

None of it was enough to avoid default for a company saddled with almost $11 billion in domestic and offshore bonds. Sunac is now the biggest developer to default on a public bond payment this year, as Sun joins fellow billionaire Hui Ka Yan at Evergrande in failing to keep up with massive debt payments.

“The group’s contracted sales have continued to decline significantly, while access to new financing has become increasingly difficult,” Sunac said in a statement Thursday.

Sunac is trying to find state-backed strategic investors to improve the company’s credit status and restore financing capabilities, Hong Kong Economic Times reported, citing unidentified people.

Sun’s personal fortune meanwhile, has tumbled along with Sunac’s share price, which was off 61% this year before it was suspended from trading in March after the company failed to release earnings.

His net worth has slipped to $1.3 billion, a decline of $2 billion in 2022 alone, according to the Bloomberg Billionaires Index.

Years late, London's 'game-changer' subway line set to open


Thu, May 12, 2022, 



LONDON (AP) — Andy Byford points out the cathedral-like ceiling, the crystal-clear acoustics, the “pureness of the aesthetic” that surrounds him.

The head of London’s public transport system is rhapsodizing about a subway station — part of a new line he says will be “the envy of the world” when it opens this month.

“It really gives people a sense of grandeur, but there is also a sense of calm,” said Byford as he showed journalists around Liverpool Street Station on London’s gleaming new east-west Elizabeth Line, due to open on May 24.

The 19 billion-pound ($23 billion) mixed overground and underground railway, named in honor of Queen Elizabeth II, is three-and-a-half years late and 4 billion pounds ($5 billion) over budget. But Byford says it will be “a game-changer” for Britain’s pandemic-scarred capital city.

“I think when it opens it is going to be a huge morale boost for London, post-COVID," said Byford, who is commissioner of Transport for London. "What could be a greater symbol of London’s emergence from COVID than this spectacular railway?”

Yet there’s a question mark over whether London still needs the Elizabeth Line.

Since ground was first broken on the project — also known as Crossrail — in 2009, London has been through recession, a rocky British exit from the European Union and a coronavirus pandemic that shut down the city for months and transformed work and travel patterns, potentially for good.

Tony Travers, a professor of government at the London School of Economics, said the Elizabeth Line “is a remarkable and beautiful thing.”

“But it was built — after a lot of effort and over a very long period of time — for a different economy,” he said. “Its entire economic case was very heavily predicated on the continued growth of the economy of central London.”

Britain’s biggest infrastructure project for decades, the new line involved digging 26 miles (42 kilometers) of new tunnels under Europe’s biggest city — uncovering 68,000-year-old mammoth bones, Roman ruins and the skeletons of medieval plague victims along the way.

It was scheduled to open in late 2018. But with just months to go the launch was postponed, and then postponed again as workers struggled to finish 10 new stations and link up three separate signalling systems on the western, central and eastern stretches of the 60-mile (100-kilometer) railway.

In 2020, the builders turned to Byford, a veteran public transport executive who ran the Toronto Transit Commission and then the transit authority in New York, where he was nicknamed “Train Daddy” as he grappled with the Big Apple’s often frustrating subway and bus systems.

Byford has staked his reputation on getting the Elizabeth Line up and running.

“It’s had its challenges,” he acknowledged. “This has been a labor of love for us. We’ve sweated blood over this thing.”

The largely underground central section from Paddington Station in west London to Abbey Wood in the southeast opens to paying customers this month, days before the U.K. celebrates the queen’s Platinum Jubilee, though it won’t be fully integrated with the aboveground eastern and western legs until the fall.

Builders say the Elizabeth Line will provide a speedy new link between Heathrow Airport west of London, the City financial district in the center and the Canary Wharf business hub in the east.

For anyone who has ridden London’s cramped Underground, parts of which are more than 150 years old, the scale of the new line is a pleasant shock. The spacious trains can carry more than 1,000 passengers each. They are also air conditioned, something that’s a rarity on London’s sweaty Tube. The tunnels seem to curve on forever and the stations soar — Paddington is 10 stories high and as long as the Shard, London’s tallest skyscraper.

Crossrail’s builders are proud of the attention to detail, from the purple patterned fabric on the train seats to the playful station design touches, like a ceiling of Liverpool Street Station in the City that is striped to evoke a banker’s pinstriped suit. Lighting is cool in the concourse, warm on the platforms — a “nudge” to subtly encourage people towards the trains.

The Elizabeth Line opens in a city, and country, facing economic uncertainty, with the war in Ukraine fueling record inflation and the city center still quieter than before the pandemic as many officers work at least part time from home. The line's expected ridership has been scaled back from a predicted 250 million people a year before the pandemic, to about 200 million a year.

The transit network, London's circulatory system, needs even more investment. But Britain’s Conservative government is focused on spreading economic opportunity from the wealthy south of England to the poorer Midlands and north, and is reluctant to spend money on the capital city — especially since London is a stronghold of the opposition Labour Party.

A planned Crossrail 2 that would slice through London from southwest to northeast is on hold, though Crossrail chief executive Mark Wild hopes it will be completed one day.

He is certain the new line will help get London back on track.

“If there’s ever going to be a railway that’s pandemic-proof, it’s this one,” Wild said. “It’s airy, fast, the stations are cathedral-like, the air’s fresh. It’s modern, clean. If there’s ever a railway that can stimulate a return to the office, it’s going to be this one.”

Jill Lawless, The Associated Press

Sweden sees highest inflation rate since 1991

Thu, May 12, 2022, 

COPENHAGEN, Denmark (AP) — Inflation in Sweden increased last month to its highest level since 1991, officials said Thursday, as countries worldwide grapple with surging prices exacerbated by Russia's war in Ukraine.

The consumer price index rose 6.4% in April from a year ago and was up from 6.1% in March, according to official figures from Statistics Sweden.

There was a “continued widespread price increase in April, including food, household equipment, restaurant visits and hotels,” statistician Mikael Nordin said.

High energy prices also were fueling inflation, a key factor in the rest of Europe and other parts of the world amid fears that the war may lead to an interruption of oil or natural gas supplies from Russia.

Statistics Sweden said food prices increased, with meat and vegetables being “the primarily contributors” for the hike. Clothing and books saw seasonal price increases, while furnishing and household equipment prices “have now risen for six consecutive months.”

Prices also increased for home repairs and maintenance, transportation and other goods and services, the agency said.

Sweden, a member of the European Union, is not among the 19 countries that use the euro currency. Annual inflation in the eurozone hit a record-high 7.5% last month.

The U.S. saw consumer prices jump 8.3% last month from a year ago, remaining close to four-decade high.

The Associated Press

Why the Fed wants corporate America to have a hiring freeze: Morning Brief

Ethan Wolff-Mann

·Chief-of-staff

Thu, May 12, 2022, 

The chorus of those wanting a weaker labor market is getting louder and louder.

After the recent job numbers were released last week, Bank of America analysts said in a note they are essentially "rooting against the home team" and hope the numbers stop being so strong. As higher wages contribute to inflation, the Federal Reserve appears to agree.

“Chair Powell keeps mentioning the relationship between the high level of job openings and wage/price inflation,” Nicholas Colas, co-founder of DataTrek, wrote in a newsletter on Tuesday. “He’s not talking to investors. He’s talking to corporate America, and his goal is to have companies essentially institute a hiring freeze and end the cycle of paying up for new hires.”

Wednesday's economic release of consumer prices (CPI) showed inflation rose more slowly in April (8.3%) compared to March (8.5%). While the report was expected to have shown a March peak, there wasn't much good news.

"[Substantial] declines in the annual rate of inflation are unlikely to materialize until there are significant improvements in geopolitical tensions (that would get energy prices lower), supply chain strains and labour market shortages," wrote ING's James Knightley in a note after the release. "Unfortunately, there is little sign of any of this happening anytime soon."

TD Securities analysts agreed, noting the "report should be of concern for the Fed given price gains in the core segment appear to be spreading."

According to the consensus view of economists and analysts, shocks to commodities, supply chain issues, and the red hot (and very tight) labor market are all keeping inflation high and unpleasant. But it's the labor market that appears hardest to vanquish.

While supply-chain problems and big price shocks have been easing, "we see no such let-up when it comes to labor cost pressure," Bank of America's global economist Ethan S. Harris pointed out. Employers can't find people to fill open positions, tons of people are changing jobs, and "looking ahead there is no sign of stabilization."

In Colas's view, the only way to get stabilize inflation is to use the monetary policy hammer to hit stock prices.

“The Fed’s goal is to convince corporate America to enact a short-term hiring freeze, and it will keep raising rates and talking about aggressive monetary policy until that happens,” Colas wrote. “Lower stock prices are his way of convincing C-suites and boards to do that.”

The Fed's 'blunt force tool of rate policy'

Powell has been focused on the ratio between job openings versus unemployed workers and the core personal consumption expenditures price index, which measures inflation.

“Chair Powell mentioned the ratio several times at last Wednesday’s press conference,” said Colas, who said job postings need to drop from 11.5 million to around 8 million to get to normalcy.

The only way to get there would be some sort of freeze from companies.

U.S. Federal Reserve Chairman Jerome Powell testifies during the Senate Banking Committee hearing titled "The Semiannual Monetary Policy Report to the Congress", in Washington, U.S., March 3, 2022. Tom Williams/Pool via REUTERS

“[Freezes] typically [happen] when C-suites and boards decide that business conditions have become very uncertain. The Fed doesn’t have a seat at those discussions, but it does have the blunt force tool of rate policy and its effect on stock prices,” Colas said. “Chair Powell has made it clear that he wants to see openings decline.”

The big question is by how much — and whether it will be enough to whip out the “R” word?

Harris wrote if the strength stays at the 200,000 openings per month pace we’ve seen, “the Fed will need to push job growth down to ~25k per month.”

But, Harris added, “If the labor force has slowed to a more trend-like 100k then they will need to push job growth to negative 70k. That is, they would need to trigger a mild recession.”

WAGE THEFT
South Carolina restaurant repays $624,000 to staff after tip pool is ruled illegal

Grace Dean
Thu, May 12, 2022

The restaurant told Insider that a lawyer had previously told it that its tip pool policy was legal and appropriate.

Davit85/Getty Images

A South Carolina restaurant required staff to share tips with managers illegally, the DOL said.


The restaurant said a lawyer had advised that its tip pool policy was legal and appropriate.


It paid $624,017 in back wages to 92 workers after the DOL investigation.

A seafood restaurant in South Carolina has repaid $624,000 to workers after the Department of Labor found it had forced them to share tips with other staff.

The Charleston restaurant, 167 Raw, "shortchanged" 92 workers by "forcing them to participate in an illegal tip pool" that included management and other employees who did not usually get tips, the department said in a press release.

The repayment equates to around $6,700 per worker.

Managers and supervisors are not allowed to keep their workers' tips "under any circumstances," including through tip pools, per the Fair Labor Standards Act.

US employers can pay tipped staff as little as $2.13 an hour, with tips bringing their take-home pay up to a minimum of $7.25 an hour.

Because the restaurant required the staff to share tips illegally, it invalidated its claim to a tip credit and therefore meant workers were paid less than the federal minimum wage, the DOL said.

Following the investigation, 167 Raw was ordered to pay $624,017 in back wages to the 92 staff.

167 Raw King Street LLC, which owns the restaurant in Charleston along with two others, said it entered into a voluntary agreement with the DOL over its tipping policy.

The company told Insider that before setting up the tip pool it had been advised by lawyers that the move was legal.

"Months later, however, the Department of Labor concluded that these procedures were in direct violation of certain federal guidelines. The department began a full investigation and determined that while we had not intentionally violated any regulation, we had instead relied upon incorrect legal advice," the company said.

167 Raw King Street said it cooperated with the DOL to establish new procedures and corrected the "misallocation of tips." The company's owners never took part in the tip pool, it added.

Millions of restaurant workers have quit their jobs during the pandemic, with many blaming the industry's low wages, lack of benefits, and poor working conditions. In March alone, 810,000 workers in the food services and accommodation sector quit their jobs, according to the Bureau of Labor Statistics.

Jamie Benefiel, a DOL official in Columbia, South Carolina, said: "As food service industry employers struggle to find people to fill the jobs needed to remain competitive, they must take into account that retaining and recruiting workers is more difficult when employers fail to respect workers' rights and pay them their full wages."

CRIMINAL CAPITALI$M PAYES

A Moderna exec will be paid $700,000 despite leaving his job after 1 day, a report says


Stephen Jones
Thu, May 12, 2022

Jorge Gomez is one of a number senior executives to leave the vaccine maker in recent months.

SOPA Images / Contributor / Getty Images

Moderna's CFO Jorge Gomez will be paid $700,000, despite spending only one day in his new job.


Gomez left after his former employer notified the SEC that it was investigating financial reporting.


He will, however, forfeit his $500,000 signing bonus, Moderna told the Wall Street Journal.

A senior executive will be paid $700,000 in severance, despite only spending a day in his new job at vaccine maker Moderna, reports suggest.

On Wednesday, the pharmaceutical giant announced that its chief financial officer, Jorge Gomez, had departed the company "effective immediately," following a disclosure by his former employer that it's investigating financial misreporting.

Gomez formally began his role on Monday, a month after leaving his role as CFO at the dentistry manufacturer, Dentsply Sirona. Despite his early departure, he will still receive his annual salary of $700,000 as part of his severance package, the Wall Street Journal reported, quoting Moderna. He will, however, forfeit his $500,000 signing bonus, per the report.

It's extremely rare for an executive to leave a firm within such a short period. Listed firms go to great lengths to properly vet candidates, as part of their due diligence. The process can take many months and usually involves background checks. The nature of Gomez's departure poses questions over how rigorously this process was performed.

Moderna told the FT that it was made aware of the internal investigation, following Dentsply's disclosure, made in a filing to the US Securities and Exchange Commission (SEC) on Tuesday.

In March 2022, Dentsply's board of directors began an investigation into allegations surrounding the financial reporting of the use of incentives to sell its products, as well as the disclosure of the impact on sales, according to the filing.

The audit committee is also investigating "former and current members of senior management" over allegations that they used these incentives to affect executive compensation.

The investigation does not name Gomez specifically. In April, Dentsply terminated its former CEO Donald Casey and removed him from the board, but did not disclose why.

Gomez's predecessor, David Meline, will resume his position while the firm searches for a replacement, Moderna said in a statement.

Gomez was expected to play a key role in the drug maker's ESG and sustainability efforts as it enters a new phase of growth following the commercial success of its mRNA COVID-19 vaccine.

Moderna, Dentsply, and Gomez are yet to respond to Insider's request for comment, which was made outside of US business hours.