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    U.S. should pump more oil to avert war-level energy crisis, says JPMorgan’s Jamie Dimon

    JPMorgan Chase CEO Jamie Dimon told CNBC Monday that the U.S. should forge ahead in pumping more oil and gas to help alleviate the global energy crisis.
    Likening the situation to a national security risk of war-level proportions, Dimon said Western allies should support the U.S. in shoring up supply.
    “”America needs to play a real leadership role. America is the swing producer, not Saudi Arabia,” Dimon told CNBC’s Julianna Tatelbaum.

    Dimon said in June that he was preparing the bank for an economic “hurricane” caused by the Federal Reserve and Russia’s war in Ukraine.
    Al Drago | Bloomberg | Getty Images

    JPMorgan Chase CEO Jamie Dimon said Monday that the U.S. should forge ahead in pumping more oil and gas to help alleviate the global energy crisis, likening the situation to a national security risk of war-level proportions.
    Speaking to CNBC, Dimon dubbed the crisis “pretty predictable” — occurring as it has from Europe’s historic overdependence on Russian energy — and urged Western allies to support the U.S. in taking a lead role in international energy security.

    “In my view, America should have been pumping more oil and gas and it should have been supported,” Dimon told CNBC’s Julianna Tatelbaum at the JPM Techstars conference in London.
    “America needs to play a real leadership role. America is the swing producer, not Saudi Arabia. We should have gotten that right starting in March,” he continued, referring to the onset of the energy crisis following Russia’s invasion of Ukraine on Feb. 24.

    This should be treated almost as a matter of war at this point, nothing short of that.

    Jamie Dimon
    CEO, JPMorgan Chase

    Europe — once a major importer of Russian energy, relying on the country for up to 45% of its natural gas needs — has been at the forefront of that crisis; facing higher prices and dwindling supply as a result of sanctions levied against the Kremlin.
    And while EU nations have hit targets to shore up gas supplies over the coming winter months, Dimon said leaders should now be looking ahead to future energy security concerns.
    “We have a longer-term problem now, which is the world is not producing enough oil and gas to reduce coal, make the transition [to green energy], produce security for people,” he said.

    “I would put it in the critical category. This should be treated almost as a matter of war at this point, nothing short of that,” he added.

    ‘It’s Pearl Harbor’

    Referring to the war in Ukraine more broadly, Dimon dubbed it an attack of similar magnitude to that of Pearl Harbor or the invasion of Czechoslovakia in 1968.
    “It’s Pearl Harbor, it’s Czechoslovakia, and it’s really an attack on the Western world,” he said.
    However, the CEO said it also presented an opportunity for the West to “get its act together” and defend its values in the face of autocratic regimes.
    “The autocratic world thinks that the Western world is a little lazy and incompetent — and there’s a little bit of truth to that,” said Dimon.
    “This is the chance to get our act together and to solidify the Western, free, democratic, capitalist, free people, free movements, freedom of speech, free religion for the next century,” he continued.
    “Because if we don’t get this one right, that kind of chaos you can see around the world for the next 50 years.”

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    U.K. Government Plans an Update to Its Tax and Spending Agenda

    After an earlier announcement sent markets into a tailspin, the prime minister and the chancellor are under pressure to restore fiscal credibility.After days of confusion, Britain’s government said on Monday that the date for its next fiscal policy announcement would be moved up nearly a month and that it would provide, at the same time, a much-anticipated independent assessment of the policies’ impact on the nation’s economy and public finances.The chancellor of the Exchequer, Kwasi Kwarteng, said he would publish his “medium-term fiscal plan” on Oct. 31, which would show how the government, under the new prime minister, Liz Truss, would bring down debt levels despite large spending plans and tax cuts that would be funded by borrowing.New economic and fiscal forecasts from the Office for Budget Responsibility, a government watchdog, are to be published the same day.The move is aimed to reassure financial markets and the public of the new government’s fiscal credibility. Its first major economic announcement, a speech by Mr. Kwarteng on Sept. 23, was dominated by unfunded tax cuts at a time of high inflation, and it quickly sent markets into a tailspin: The British pound hit a record low against the dollar, and turmoil in the bond market led to higher mortgage rates and intervention from the Bank of England to protect pension funds.Since then, the government has canceled its plan to abolish the top income tax rate for the highest earners — the most surprising tax-cutting measure announced last month — and tried to restore its fiscal credibility, while maintaining its commitment to an agenda of using tax cuts and deregulation to speed economic growth.Rising Inflation in BritainInflation Slows Slightly: Consumer prices are still rising at about the fastest pace in 40 years, despite a small drop to 9.9 percent in August.Interest Rates: On Sept. 22, the Bank of England raised its key rate by another half a percentage point, to 2.25 percent, as it tries to keep high inflation from becoming embedded in the nation’s economy.Truss’s Experiment Stumbles: Prime Minister Liz Truss says a mix of tax cuts and deregulation is needed to jump-start Britain’s sluggish economy. Investors, economists and some in her own party disagree.Mortgage Market: The uptick in interest rates roiled Britain’s mortgage market, leaving many homeowners calculating their potential future mortgage payments with alarm.Part of this rehabilitation effort included a promise to publish a more detailed fiscal plan focused on reducing debt and provide an independent analysis by the Office for Budget Responsibility. But the date was set for Nov. 23 — too long to wait, said fellow Conservative Party members, opposition lawmakers and investors.Liz Truss, the prime minister, with Mr. Kwarteng visiting a construction site last week. Pool photo by Stefan RousseauLast week, it was widely reported that the date would be moved forward, and Mr. Kwarteng denied this. On Monday, he confirmed that the announcement would indeed arrive on Oct. 31.Two weeks ago, in the immediate aftermath of Mr. Kwarteng’s policy speech, the pound plummeted to $1.035 and speculation grew that it could reach parity with the dollar. The cancellation of the top tax rate cut, which the government argued had become a distraction from its overall growth plan, helped the currency rebound a bit.But that recovery has stalled. On Monday, the pound was trading around $1.10 amid skepticism that the government’s plan would expand the economy as promised, and that instead large public spending cuts would be necessary.Fitch Ratings said on Monday that it expected the British economy to contract 1 percent next year, after “extreme volatility” in British financial markets and the prospect of “sharply higher” interest rates. Last month, it forecast a 0.2 percent decline for next year.“Rising funding costs, tighter financing conditions, including for mortgage borrowers, and increased uncertainty will outweigh the impact of looser fiscal policy” next year, analysts at the ratings agency wrote. They expect Britain’s economy to enter a recession in this quarter. The agency has already changed its ratings outlook for Britain to negative.That was just one of many rebukes of the government’s plans. For example, the International Monetary Fund encouraged the government to re-evaluate the tax cuts, which it said would increase inequality.But Ms. Truss, seeking to reverse years of sluggish growth and weak productivity, has been clear that she wants to run the economy differently than her predecessors. One early decision was to fire the top civil servant in the Treasury, Tom Scholar, a move that rattled some analysts. On Monday, the government announced his successor, James Bowler, who will transfer from the international trade department but spent two decades at the Treasury previously.Even as the government makes conciliatory moves, there are signs of distress in financial markets. On Monday, the Bank of England said it would expand its intervention in the bond market. The bank will increase the size of the daily auctions in a bond-buying program that was set up to support pensions funds, after tumult in this market threatened Britain’s financial stability.Over the last eight trading days, the bank bought only about 5 billion pounds of long-dated government bonds in total, despite setting a limit of £5 billion a day. With markets wondering what will happen when the bond-buying operation ends on Friday, the central bank announced that it would expand its support. As well as increasing the auction sizes, it will set up a new collateral facility to try to ease liquidity problems faced by the pension funds. That facility will continue beyond this week.The announcement appeared to do little to ease the markets. On Monday, Britain’s bond prices kept falling, while the yield on 30-year bonds rose to 4.72 percent, once again approaching highs seen during the worst of the bond rout after the last fiscal statement.The financial district in London. The new government’s first major economic announcement, on Sept. 23, quickly sent markets into a tailspin.Alex Ingram for The New York Times More

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    Ark’s Cathie Wood issues open letter to the Fed, saying it is risking an economic ‘bust’

    The Fed likely is making a mistake in its hard-line stance against inflation because it is looking backward, Ark Invest’s Cathie Wood said Monday.
    In an open letter, Wood suggested the central bank “has shocked not just the US but the world and raised the risks of a deflationary bust.”

    Cathie Wood, Founder, CEO, and CIO of ARK Invest, speaks at the 2022 Milken Institute Global Conference in Beverly Hills, California, May 2, 2022.
    David Swanson | Reuters

    The Federal Reserve likely is making a mistake in its hard-line stance against inflation Ark Investment Management’s Cathie Wood said Monday in an open letter to the central bank.
    Instead of looking at employment and price indexes from previous months, Wood said the Fed should be taking lessons from commodity prices that indicate the biggest economic risk going forward is deflation, not inflation.

    “The Fed seems focused on two variables that, in our view, are lagging indicators –– downstream inflation and employment ––both of which have been sending conflicting signals and should be calling into question the Fed’s unanimous call for higher interest rates,” Wood said in the letter posted on the firm’s website.
    Specifically, the consumer price and personal consumption expenditures price indexes both showed inflation running high. Headline CPI rose 0.1% in August and was up 8.3% year over year, while headline PCE accelerated 0.3% and 6.2% respectively. Both readings were even higher excluding food and energy, which saw large price drops over the summer.
    On employment, payroll growth has decelerated but remains strong, with job gains totaling 263,000 in September as the unemployment rate fell to 3.5%.
    But Wood, whose firm manages some $14.4 billion in client money across a family of active ETFs, said falling prices for items such as lumber, copper and housing are telling a different story.

    Worries over a ‘deflationary bust’

    The Fed has approved three consecutive interest rate increases of 0.75 percentage point, mostly by unanimous vote, and is expected to OK a fourth when it meets again Nov. 1-2.

    “Unanimous? Really?” Wood wrote. “Could it be that the unprecedented 13-fold increase in interest rates during the last six months––likely 16-fold come November 2––has shocked not just the US but the world and raised the risks of a deflationary bust?”
    Inflation is bad for the economy because it raises the cost of living and depresses consumer spending; deflation is a converse risk that reflects tumbling demand and is associated with steep economic downturns.
    To be sure, the Fed is hardly alone in raising rates.
    Nearly 40 central banks around the world approved increases during September, and the markets have largely expected all the Fed’s moves.
    However, criticism has emerged recently that the Fed could be going too far and is at risk of pulling the economy into an unnecessary recession.
    “Without question, food and energy prices are important, but we do not believe that the Fed should be fighting and exacerbating the global pain associated with a supply shock to agriculture and energy commodities caused by Russia’s invasion of Ukraine,” Wood wrote.
    The Fed is expected to follow the November hike with a 0.5 percentage point rise in December, then a 0.25 percentage point move early in 2023.
    One area of the market known as overnight indexed swaps is pricing in two rate cuts by the end of 2023, according to Morgan Stanley.

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    Nobel economics prize awarded to U.S.-based economists including Bernanke for work on financial crises

    Bernanke was chairman of the Federal Reserve from 2006 to 2014 and is now at the Brookings Institution in Washington, D.C.
    Diamond is a professor at the University of Chicago Booth School of Business, and Dybvig is a professor at the Olin Business School of Washington University in St. Louis.

    Ben Bernanke, former chairman of the U.S. Federal Reserve, speaks during the American Economic Association and Allied Social Science Association Annual Meeting on Friday, Jan. 4, 2019. Bernanke is one of three winners of the 2022 Nobel prize in economics.
    Bloomberg | Bloomberg | Getty Images

    U.S.-based economists Ben Bernanke, Douglas Diamond and Philip Dybvig were awarded the Nobel prize in economic sciences for 2022 for their research on banks and financial crises.
    Bernanke was chairman of the Federal Reserve from 2006 to 2014 and is now at the Brookings Institution in Washington, D.C. Diamond is a professor at the University of Chicago Booth School of Business, and Dybvig is a professor at the Olin Business School of Washington University in St. Louis.

    The Nobel committee said their work in the early 1980s had “significantly improved our understanding of the role of banks in the economy, particularly during financial crises,” and in showing why it is vital to avoid bank collapses. They added this was “invaluable” during the 2008-09 financial crisis and the coronavirus pandemic.
    Bernanke’s analysis of the Great Depression in the 1930s showed how and why bank runs were a major reason the crisis was so long and severe. Diamond and Dybvig’s work, meanwhile, looked at the societally important role banks play in smoothing the potential conflict between savers wanting short-term access to their money and the economy needing savings to be put into long-term investments; and how governments can help prevent bank runs by providing deposit insurance and acting as a lender of last resort.
    The winners of the prize — officially called the Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel — receive 10 million Swedish krona ($883,000) to be split between them.
    The Royal Swedish Academy of Sciences select the winners from a list of candidates recommended by the Economic Sciences Prize Committee. This makes its selection from names submitted by around 3,000 professors, previous winners and academy members by invitation. People cannot nominate themselves.
    In a press conference following the announcement, Diamond was asked whether he had any warning for banks, institutions and governments given current rising interest rates and predictions of an economic slowdown.

    Diamond said: “Financial crises, in the way that Phil Dybvig and I think about them, become worse when people start to lose faith in the stability of the system. And that is all related to basically how profitable they think the banking sector is, in addition to being stable.”
    “So in periods when things happen unexpectedly, like I think people are surprised how quickly nominal interest rates have gone up around the world, that can be something that sets off some fears in the system. We saw some of this in the United Kingdom in their liability-driven sector of the insurance market.”
    “So I guess the best advice is to be prepared for making sure that your part of the banking sector is both perceived to be healthy and to stay healthy and to respond in a measured and transparent way to changes in monetary policy.”
    Asked about whether he foresaw another financial crisis, he said the world was “much better prepared” than in 2008, and regulatory improvements had made the system less vulnerable.
    “The banking sector itself is in very solid shape, good net worth, good risk management,” he said. “The problem is that these vulnerabilities of the fear of runs and dislocations and crises can show up anywhere, not just commercial banks.”
    The insight he and Dybvig had tried to provide, he said, was that it is crucial to be able to issue short-term, liquid liabilities, like deposits or shares, which are more liquid than underlying assets. He again cited the insurance sector in the U.K., when he said the “mismatch” came when there were calls for more collateral from insurance companies. The Bank of England has been forced to intervene to reduce market turmoil and protect pension funds following a controversial government budget.

    Last year, the economics prize was split three ways. It went to David Card, for his work on labor economics; and Joshua D. Angrist and Guido W. Imbens for their contributions to the analysis of causal relationships.
    Unlike the five other Nobel prizes, which have been handed out since 1901 and were bestowed in the will of Swedish inventor, chemist and engineer Alfred Nobel, the economics award was established in 1969 by Sweden’s central bank in his honor. It is the last to be announced each year.
    The renowned Nobel Peace Prize was awarded Friday to Belarusian human rights activist Ales Bialiatski, Russian human rights organization Memorial and the Ukrainian NGO Center for Civil Liberties.
    This year’s prize for physics went to Alain Aspect, John Francis Clauser and Anton Zeilinger, for discoveries in quantum mechanics. The Nobel committee said they had used “groundbreaking experiments” investigating particles in entangled states to begin a new era of quantum technology.
    The chemistry prize was split between Carolyn R. Bertozzi, for her work using click and bioorthogonal chemistry to map cells and develop more targeted cancer treatments; and Morten Meldal and K. Barry Sharpless, who the committee said “laid the foundations of click chemistry,” which involves connecting biocompatible molecules.
    The medicine prize was awarded to Svante Paabo “for his discoveries concerning the genomes of extinct hominins and human evolution.”
    The prize for literature went to French author Annie Ernaux.
    Correction: This story has been updated to correct the details on how the prize money is distributed.

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    As Warehouses Multiply, Some California Cities Say: Enough

    From the front yard of her ranch-style home, Pam Lemos peered out on the vast valley of her childhood.She can still picture the way it looked back in the 1980s — citrus groves blanketing hillsides, dairy farms stretching for acres and horses grazing under a bright blue sky. These days, when she looks toward the horizon, she mainly sees the metal roofs of hulking warehouses.“Now it’s all industrial,” said Ms. Lemos, 55, who has lived in Colton, 60 miles east of Los Angeles, her entire life. “We are working to change that and starting with these warehouses.”Ms. Lemos is part of a growing coalition of residents and leaders in Colton and neighboring cities — a logistical hub for the nation — who are increasingly frustrated with the proliferation of warehouses in the region, as well as the side effects of the rapid expansion.As warehouse construction has ballooned nationwide, residents in communities both rural and urban have pushed back. Neighborhood apps like Nextdoor and Facebook groups have been flooded with complaints over construction. In California, the anger has turned to widespread action.Several cities in this slice of Southern California, known as the Inland Empire, have passed ordinances in recent months halting new warehouse projects so officials can study the effects of pollution and congestion on residents like Ms. Lemos. Similar local moratoriums have cropped up in New York and New Jersey in recent years, but on a much smaller scale.Labor groups and business coalitions have entered the fray, warning that the new ordinances — along with a push in the state Legislature to widen the restrictions — will cost the region tax revenue and needed jobs and could further disrupt a shaky national supply chain.The Inland Empire, where the population has quadrupled to 4.6 million in the last 50 years as people were priced out of places closer to Los Angeles, is a critical storage-and-sorting point because of its proximity to rail lines that are a short jaunt from the ports of Los Angeles and Long Beach, global hubs that handle 40 percent of the nation’s seaborne imports.In the early 1990s, there were about 650 warehouses in the region, according to a data tool from Pitzer College in Claremont, Calif. By last year, there were nearly 4,000.Pam Lemos has lived in Colton her entire life. “Now it’s all industrial,” she said. “We are working to change that.”Amazon is a major presence, with more than a dozen warehouses in the Inland Empire. Although it is slowing its warehouse expansion nationally and has closed or mothballed some buildings, it is constructing a five-story, four-million-square-foot facility in the city of Ontario. The warehouse, which is scheduled to be completed in 2024 and expected to be one of the company’s largest in the nation, will provide jobs for roughly 1,500 people.Susan Phillips, a professor of environmental analysis at Pitzer who has studied the growth of warehouses in the Inland Empire, says the only way to regulate construction is through the municipal planning process.“Warehouse growth is totally demand-driven,” Ms. Phillips said. “Developers and many municipalities do not want any regulation on this, and at this point warehouses are growing at many times the rate of population growth.”Since 2020, elected officials in a half-dozen Inland Empire cities, including Riverside, its most populous, have imposed moratoriums on warehouse construction. The timeouts are meant to assess, among other things, the effects of pollution, the appropriate distances between homes and warehouses, and the impact of heavy truck traffic on streets.Tucked in the shadow of the San Bernardino Mountains, Colton has long been known as “Hub City” because it is a crossing of two railroads — BNSF and Union Pacific — that shuttle cargo to and from the ports. Today, the city of 54,000 is home to 58 licensed warehouses.Isaac Suchil, a councilman in Colton, was a sponsor of his city’s moratorium, which was recently extended through May 2023. While he stresses that he is not “anti-warehouse,” Mr. Suchil said he would like to see buffer zones requiring that new facilities be at least 300 feet from schools and residential areas. The current requirements vary and are applied differently from project to project, he said.“The moratorium gives us time to address future projects,” he said.Residents have grown increasingly frustrated with the proliferation of warehouses in the region.Isaac Suchil, a councilman in Colton and a sponsor of the city’s moratorium on warehouses.Colton, a city of 54,000, is home to 58 licensed warehouses.Assemblywoman Eloise Gómez Reyes, who represents several Inland Empire cities, including Colton, has taken the fight to Sacramento, the state capital. She sponsored a bill this year that would require new logistics projects in Riverside and San Bernardino Counties that are 100,000 square feet or larger to be at least 1,000 feet from homes, schools and health care centers.“The warehouses bring with them trucks producing diesel particulate matter,” Ms. Gómez Reyes said, noting an American Lung Association report this year that found that those counties were among the worst for annual particulate pollution.Ms. Gómez Reyes, who withdrew her bill from consideration after struggling to find votes, even among fellow Democrats who dominate the Legislature, said she planned to reintroduce the measure next year.The efforts to suspend and regulate warehouse construction have faced staunch opposition from groups including the Laborers’ International Union of North America, which represents construction workers in the United States, and the California Chamber of Commerce.Jennifer Barrera, chief executive of the California Chamber of Commerce, said a measure like the one put forth by Ms. Gómez Reyes would hurt job growth and apply a one-size-fits-all approach that would strip local jurisdictions of necessary freedom around land-use decisions.In the first half of 2022, there were roughly 135,400 warehouse jobs in the Inland Empire, according to the Inland Empire Economic Partnership, a group that works with business and government leaders. In 2010, there were roughly 19,900 warehouse jobs in the region.“A warehouse ban would only exacerbate the goods movement and logistics backlogs California consumers are facing,” Ms. Barrera said. “With more people ordering goods online and wanting quick delivery, the need for storage space is growing.”But some local residents are tired of feeling that their region is losing out on more than it is gaining.This summer, a deal was reached to relocate an elementary school in Bloomington, Calif., to make space for a warehouse, and earlier this year, the City Council in Ontario approved the construction of a warehouse on the site of an area that was once home to a dairy farm. In both instances, residents voiced their frustration on social media and at public meetings.“For too long it’s been build, build, build, with no repercussions,” said Alicia Aguayo, a member of the People’s Collective for Environmental Justice, a group that has pushed for some of the moratoriums.Ms. Aguayo, a lifelong resident of the Inland Empire, says that in recent years she has met more and more people in her community who have asthma and cancer. She would like to see more resources dedicated to studying the health impacts of pollution in the region.“It’s environmental racism and hitting mostly Latino communities,” Ms. Aguayo said.Last year, Southern California officials adopted rules for warehouses that aim to cut truck pollution and reduce health risks.Morris Donald has witnessed the warehouse boom from his backyard in San Bernardino, Calif.The regulations from the South Coast Air Quality Management District require large warehouses to curb or offset emissions from their operations or pay fees that go toward air-quality improvements.In San Bernardino, where a proposed effort last year fell one council vote shy of establishing a 45-day moratorium on the construction of new warehouses, Morris Donald has witnessed the warehouse boom from his backyard.For 11 years, he has rented a three-bedroom home in a neighborhood now surrounded by four warehouses. In recent years, he said, most of the neighbors he knew have moved away and several landlords have sold to developers.“It’s taken away the neighborhood feel,” Mr. Donald said. “Kids don’t play outside. No one is in their yards.”But he sees the benefits as well — he works as a forklift mechanic at a Quiksilver warehouse, his wife is a manager at another and his son works as a security guard at a third facility.“If you want jobs,” Mr. Donald said, “they’re out here in the warehouses, and that’s a fact.”In Colton, Ms. Lemos spends some of her free time volunteering for groups that work closely with the People’s Collective for Environmental Justice. The moratorium, she said, could not have come soon enough.“How did this get so out of control?” Ms. Lemos said, noting that in the months before the moratorium was enacted, the city approved a pair of warehouses with a combined square footage of 1.8 million.On a recent afternoon, Ms. Lemos twisted her Jeep Wrangler along a winding two-lane road, which was pockmarked with potholes left behind, she said, from the semi trucks that shuttle goods from warehouses. The air was thick, and a line of smog hovered along the horizon. A horn from an incoming train pierced the air.“There is always something going on here — trucks, trains, construction from warehouses,” she said. “It’s like we’re living in this logistical bubble while trying to raise our families.” More

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    Allianz Chief Economic Adviser El-Erian believes core inflation ‘is still going up’

    Allianz Chief Economic Adviser Mohamed El-Erian said he predicts headline inflation “will probably come down to about 8%,” but that core inflation “is still going up.”
    El-Erian said an increase in core inflation means “we still have an inflation issue.”

    Heidi Gutman | CNBC

    Ahead of the release of the latest consumer price index reading this week, Allianz Chief Economic Adviser Mohamed El-Erian told CBS’ “Face The Nation” Sunday that he predicts headline inflation “will probably come down to about 8%,” but that core inflation “is still going up.”
    Core inflation is what measures the drivers of inflation and how broad they are, so El-Erian said an increase in core inflation means “we still have an inflation issue.”

    Even if core inflation is still on the rise, however, El-Erian said it will eventually come down.
    “The question is, does it come down with a slowdown in the economy or a major recession?” he said on “Face the Nation.”
    The oil producer group OPEC+ announced its largest supply cut since 2020 on Wednesday, and El-Erian said this decision “does hurt the U.S.,” as it risks causing inflation to increase again. But he said the cut did not come as a surprise since the group is looking to protect oil prices in the face of declining demand.
    “That’s what they do,” he said. “But it’s certainly not good news for the U.S. economy.”

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    U.S. Job Growth Eases, but Is Too Strong to Suit Investors

    The gain of 263,000 was shy of recent monthly totals but still robust. Stocks fell on fears of a harder, longer Fed campaign to fight inflation.Job growth eased slightly in September but remained robust, indicating that the economy was maintaining momentum despite higher interest rates. But the strong showing left many investors unhappy because they saw signs that the fight against inflation may become tougher and more prolonged.Employers added 263,000 jobs on a seasonally adjusted basis, the Labor Department said Friday, a decline from 315,000 in August. The number was the lowest since April 2021 but still solid by prepandemic standards. The unemployment rate fell to 3.5 percent, equaling a five-decade low.“If I had just woken up from a really long nap and seen these numbers, I would conclude that we still have one of the strongest job markets that we’ve ever enjoyed,” said Carl Tannenbaum, chief economist at Northern Trust.Officials at the Federal Reserve have been keeping a close eye on hiring and wages as they proceed with a series of rate increases meant to combat inflation. The job data indicates that, for now, they are doing so without tipping the economy into a recession that would throw millions out of work.But it also increases the prospect that the effort to subdue price increases will be more extended. For investors, that came as bad news, since higher interest rates raise costs for companies and weigh on stock prices.The S&P 500 recorded its worst one-day performance since mid-September, falling 2.8 percent and eroding gains from earlier in the week.Fed officials have signaled in speeches this week that they remain resolute in trying to wrestle inflation lower, and that they are waiting for clear evidence that the economy is headed back toward price stability before they pull back.Wage growth has subsided somewhat, at least compared with the trend a year ago. Average hourly earnings climbed 5 percent from a year earlier, roughly matching economists’ expectations but slowing down slightly from the prior annual reading.Wages are still growing, but less rapidly in some sectorsPercent change in earnings for nonmanagers since January 2019 by sector More

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    Biden Warns Inflation Will Worsen if Republicans Retake Congress

    HAGERSTOWN, Md. — President Biden laced into Republicans on Friday for trying to enact policies that would make “every kitchen table cost” go up while lavishing tax cuts on big corporations, shedding his usual tone of bipartisanship a month ahead of the midterm elections.In a speech before factory workers at a Volvo manufacturing facility, Mr. Biden defended his economic record and accused Republicans of political hypocrisy for seeking to reap the benefit of federal funds made available by legislation that they had opposed. He also laid out the stakes of the upcoming elections, bluntly warning that Republicans will try to scale back Medicare and Social Security benefits if they win control of Congress. And he accused Republicans of rooting against America’s economic success.“This is a choice between two very different ways of looking at the economy,” Mr. Biden said.Mr. Biden’s comments came as Labor Department figures showed that the United States economy added 263,000 jobs in September and that the unemployment rate fell to 3.5 percent, from 3.7 percent a month earlier. The report suggests that the labor market is cooling as the Federal Reserve raises interest rates but that the central bank will likely have to take further steps to slow the economy in order to tame inflation.Mr. Biden said that the numbers were a sign that the economy was transitioning to stable growth.“Our job market continues to show resilience as we navigate through this economic transition,” he said. “The pace of job growth is cooling while still powering our recovery forward.”Despite concerns about an economic slowdown, Mr. Biden’s remarks were the latest attempt by the White House to highlight examples of America’s manufacturing resurgence with a focus on the automobile sector in the run-up to the November midterm elections.The State of the 2022 Midterm ElectionsWith the primaries over, both parties are shifting their focus to the general election on Nov. 8.Standing by Herschel Walker: After a report that the G.O.P. Senate candidate in Georgia paid for a girlfriend’s abortion in 2009, Republicans rallied behind him, fearing that a break with the former football star could hurt the party’s chances to take the Senate.Wisconsin Senate Race: Mandela Barnes, the Democratic candidate, is wobbling in his contest against Senator Ron Johnson, the Republican incumbent, as an onslaught of G.O.P. attack ads takes a toll.G.O.P. Senate Gains: After signs emerged that Republicans were making gains in the race for the Senate, the polling shift is now clear, writes Nate Cohn, The Times’s chief political analyst.Democrats’ Closing Argument: Buoyed by polls that show the end of Roe v. Wade has moved independent voters their way, vulnerable House Democrats have reoriented their campaigns around abortion rights in the final weeks before the election.The Volvo facility in Hagerstown employs more than 1,700 workers and makes parts for Mack Trucks.The visit also came with political calculations, as Representative David Trone, a Maryland Democrat, was locked in a tight re-election race with his Republican challenger, Neil Parrott. Hagerstown is also close to the border with Pennsylvania, where the senate and governor’s races are two of the most consequential political contests in the country.Mr. Biden maintained a more pointed tone with Republicans as he made claims about the benefits of the so-called Inflation Reduction Act that Congress passed in August. He called out Republicans such as Representative Paul Gosar of Arizona and Representative Andy Barr of Kentucky for seeking federal funds for local projects while criticizing his agenda, calling it “socialism.”.css-1v2n82w{max-width:600px;width:calc(100% – 40px);margin-top:20px;margin-bottom:25px;height:auto;margin-left:auto;margin-right:auto;font-family:nyt-franklin;color:var(–color-content-secondary,#363636);}@media only screen and (max-width:480px){.css-1v2n82w{margin-left:20px;margin-right:20px;}}@media only screen and (min-width:1024px){.css-1v2n82w{width:600px;}}.css-161d8zr{width:40px;margin-bottom:18px;text-align:left;margin-left:0;color:var(–color-content-primary,#121212);border:1px solid var(–color-content-primary,#121212);}@media only screen and (max-width:480px){.css-161d8zr{width:30px;margin-bottom:15px;}}.css-tjtq43{line-height:25px;}@media only screen and (max-width:480px){.css-tjtq43{line-height:24px;}}.css-x1k33h{font-family:nyt-cheltenham;font-size:19px;font-weight:700;line-height:25px;}.css-ok2gjs{font-size:17px;font-weight:300;line-height:25px;}.css-ok2gjs a{font-weight:500;color:var(–color-content-secondary,#363636);}.css-1c013uz{margin-top:18px;margin-bottom:22px;}@media only screen and (max-width:480px){.css-1c013uz{font-size:14px;margin-top:15px;margin-bottom:20px;}}.css-1c013uz a{color:var(–color-signal-editorial,#326891);-webkit-text-decoration:underline;text-decoration:underline;font-weight:500;font-size:16px;}@media only screen and (max-width:480px){.css-1c013uz a{font-size:13px;}}.css-1c013uz a:hover{-webkit-text-decoration:none;text-decoration:none;}How Times reporters cover politics. We rely on our journalists to be independent observers. So while Times staff members may vote, they are not allowed to endorse or campaign for candidates or political causes. This includes participating in marches or rallies in support of a movement or giving money to, or raising money for, any political candidate or election cause.Learn more about our process.“I didn’t know there were that many socialist Republicans,” Mr. Biden joked.Mr. Biden, who on Thursday evening attended a fund-raiser at the Manhattan home of the Democratic donor James Murdoch, said that Republicans have a “Park Avenue” view of the world that stands in stark contrast to his policies that are born out of concern for people in places like Scranton, Pa., where Mr. Biden was born, and Hagerstown.Republicans seized on signs of a cooling job market to assail Mr. Biden for economic mismanagement on Friday.“The economy is shrinking, inflation is raging, and job growth is slowing,” said Representative Kevin Brady of Texas, the top Republican on the House Ways and Means Committee.While the White House has so far sounded very in line with the Fed’s push to fight the quickest inflation in four decades, that tone could shift somewhat as the economy begins to show cracks.The Biden administration has made it clear that it respects the Fed’s independence to set policy free of partisan interference, but it might be challenging for administration officials to embrace the central bank’s actions too loudly when the Fed’s policies are hurting the economy and inflicting pain on workers.Mr. Biden acknowledged that economic headwinds continued to persist, noting that gasoline prices are inching back up “because of what the Russians and the Saudis just did.”“I’m not finished with that just yet,” he added.Despite his sharper tone, Mr. Biden said that he remained hopeful that bipartisan cooperation could be possible after the election.“That’s my hope, that after this election, there will be a little return to sanity,” Mr. Biden said. “That we’ll stop this bitterness that exists between the parties and have people working together.” More