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    American Eagle profit soars, but sales grow slower than expected

    American Eagle is making gains in improving profit and saw its fiscal first-quarter net income nearly quadruple compared to the year-earlier period.
    Still, it has a cautious outlook for the second half of the year as it plans to lap tougher comparisons and contend with “noise” around the upcoming election, finance chief Mike Mathias told CNBC.
    American Eagle President Jennifer Foyle said the company is revamping its product assortment and reducing the number of items it sells.

    An American Eagle Outfitters store in New York, US, on Monday, May 27, 2024. American Eagle Outfitters Inc. is scheduled to release earnings figures on May 29. 
    Stephanie Keith | Bloomberg | Getty Images

    American Eagle on Wednesday said it’s making gains in boosting profitability as it works to improve its product assortment and tweak operations. Still, its fiscal first-quarter sales came in weaker than Wall Street expected. 
    Nevertheless, revenue gained 6% year over year and marked a record for the first quarter, the company said in a news release. 

    Shares fell about 5% in extended trading on Wednesday.
    Here’s how the apparel company did compared with what Wall Street was anticipating, based on a survey of analysts by LSEG:

    Earnings per share: 34 cents vs. 28 cents expected
    Revenue: $1.14 billion vs. $1.15 billion expected

    The company’s reported net income for the three-month period that ended May 4 nearly quadrupled compared to the year-ago period. American Eagle posted net income of $67.8 million, or 34 cents per share, compared with $18.5 million, or 9 cents per share, a year earlier. 
    Sales rose to $1.14 billion from $1.08 billion a year earlier.
    American Eagle said it’s continuing to expect operating income in the range of $445 million to $465 million, reflecting revenue growth of up 2% to 4% compared to the prior year. That’s slightly below estimates of up 3.4%, according to LSEG.

    Finance Chief Mike Mathias told CNBC that American Eagle is maintaining a “cautious” view for the back half of the year as it prepares to lap some tougher comparisons, awaits interest rate decisions from the Federal Reserve and prepares for “noise” around the upcoming presidential election. 
    He added the company is waiting to see how the back-to-school shopping season goes to get a better idea on how the rest of the year plays out. 
    For the current quarter, American Eagle expects operating income in the range of $95 million to $100 million, reflecting revenue growth of high single digits, which is in line with the 7.4% uptick that analysts had expected, according to LSEG. 
    The apparel company, which runs its namesake banner and intimates brand Aerie, is in the midst of a new strategy to boost growth. It’s looking to grow sales by 3% to 5% each year over the next three years and get its operating margin to about 10%.
    Some of its efforts are beginning to bear fruit. During the fiscal first quarter, American Eagle grew its gross margin by 2.4 percentage points. Mathias said that’s the company’s second highest rate since 2008 in the company’s earning call. The gains were driven by better inventory management, lower product and transportation costs and leverage on expenses including rent, delivery and distribution and warehousing. 
    “Key drivers of growth included women’s overall, especially in tops which as I reviewed is a major priority for us. I’ll also highlight strength in dresses, skirts and jeans, in these areas we are seeing a positive customer response as we look to capture the social casual dressing occasion and a wider age demo. Both of these are key growth opportunities within our long term plan,” American Eagle’s president and executive creative director Jennifer Foyle added in the earnings call.
    American Eagle’s strategy has also focused on revamping its product assortment, removing items that weren’t working for its customers and drilling down on the categories that are resonating. 
    Foyle told CNBC that the company was just “over-skued” — meaning it had too many different individual products, often referred to in the industry as SKUs, for consumers to choose from. 
    “We knew we could do more with less,” said Foyle. “So deeper investments in our bottoms but less SKUs so that we are servicing our customer on the fits that they’re demanding from us.” 
    “We’ve really taken that category back, we’re winning,” Foyle said of the company’s denim business. “Definitely in women’s, some early earnings in men’s, as I mentioned you will see more of that earnings in Q3. We remain very nimble in that category but we’re definitely more balanced than we had been in the past.”
    The company has also been working to revamp its stores and introduce new formats. It recently implemented a new store design for American Eagle, which is “outpacing the balance of the chain,” said Foyle. 
    “We’re excited about remodeling our stores with a new feeling for the brand that I think expresses exactly what we’ve been up to,” she said. “The customer, obviously is loving what they see in that store design based on the results.”

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    American shares tumble 13% after sales strategy backfires; carrier cuts growth

    American Airlines will slash its capacity growth in the second half of the year and consider a host of other changes to its operations, CEO Robert Isom said.
    The carrier cut its revenue and profit forecast and is parting ways with Chief Commercial Officer Vasu Raja.
    Pressure has been mounting on American’s leadership team after more upbeat results from rivals Delta and United.

    An American Airlines’ Embraer E175LR (front), an American Airlines’ Boeing 737 (C) and an American Airlines’ Boeing 737 are seen parked at LaGuardia Airport in Queens, New York on May 24, 2024. 
    Charly Triballeau | AFP | Getty Images

    American Airlines will slash its capacity growth in the second half of the year and consider a host of other changes to a sales strategy that backfired, CEO Robert Isom said Wednesday. The comments come a day after the carrier cut its revenue and profit forecast and said it is parting ways with its chief commercial officer, Vasu Raja.
    American will grow capacity about 3.5% in the second half of the year compared with the year earlier, down from roughly 8% year-over-year growth in the first six months of 2024.

    The company’s shares tumbled more than 13% on Wednesday as investors weighed the airline’s missteps as the peak travel season gets underway, with some analysts questioning how American can capitalize on what rivals expect to be a record summer. It was the stock’s biggest percentage drop in nearly four years, during the travel plunge early in the Covid-19 pandemic.
    United Airlines shares rose more than 2% and Delta’s fell less than 1%.
    Isom said American is weighing changes to a plan Raja led to drive direct bookings at the airline in lieu of third-party sites and travel agencies, a strategy that included gutting the airline’s sales department.
    The changes angered travel agencies who weren’t able to access some of the carrier’s fares as before, making it harder for them to sell tickets on American flights.
    The chief commercial officer will leave the company next month.

    Stock chart icon

    An American Airlines stock chart shows how the company’s shares have tumbled in the past year.

    “We’ve used a lot of sticks. We’ve got to put some more carrots in place and make sure that our product is available wherever customers want to buy it,” Isom said at the Bernstein Strategic Decisions conference on Wednesday.
    American in February said it would limit some travel agency bookings from being eligible to earn AAdvantage frequent flyer miles. Isom said Wednesday that the airline would reverse that decision.
    “That’s off,” Isom said. “We’re not doing that because it would create confusion and disruption for our end customer.”
    Isom called Raja, who has been at American for 20 years “an innovator, a disruptor,” adding that “sometimes we need a reset.” Raja didn’t immediately comment.

    Corporate travel troubles

    Raja said last month American’s corporate booking growth was coming in behind big rivals Delta and United.
    Corporate bookings are particularly lucrative for airlines especially when those travelers book at the last minute when fares are at their highest — so called close-in bookings. Airlines had struggled during the pandemic and shortly afterward when business travel was slow to return, but carriers have seen improvement lately.
    “The weakness that you’ve seen in American is, I do believe, something that speaks to close-in bookings, the highest premium customers that, unfortunately, we haven’t made ourselves as available and easy to work with as we can,” Isom said.
    On an earnings call last month, Raja said American’s corporate bookings were up mid-to-high single-digit percentage points in the first quarter compared with increases of around 14% touted by Delta and United.
    “A significant miss driven in part by close in bookings puts AAL’s ability to reap the full value of a robust summer flying season in greater doubt,” Bernstein airline analyst David Vernon said in a note.

    Revenue shortfalls

    After the market closed Tuesday, American said its unit revenues could fall as much as 6% in the second quarter from a year earlier, down from its forecast last month of a no-more-than-3% decline. Airlines make the bulk of their money during the second and third quarters, but some areas have fared better than others.
    Isom admitted Wednesday that the company has logged softer bookings than it expected and noted a supply and demand “imbalance” that has prompted carriers to discount tickets. He said industry capacity should come down in the second half of the year, while it slows its own growth.
    United, minutes after American’s forecast adjustment Tuesday, reiterated its second-quarter earnings estimates, though it didn’t provide a revenue outlook.
    “American’s diminished guide speaks far more to its flawed initial forecast than any broad-based shift in passenger demand,” JPMorgan airline analyst Jamie Baker said in a note Wednesday, adding that United’s reiterated forecast was an encouraging sign for Delta.
    American has also been prioritizing Sun Belt cities and its large hubs in Texas and North Carolina over coastal markets.
    The Transportation Security Administration screened the most people ever over Memorial Day weekend, and executives from United and Delta have predicted a record summer, with very strong trans-Atlantic bookings.

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    Stocks making the biggest moves after hours: Salesforce, UiPath, Capri, Pure Storage and more

    The logo for Salesforce is displayed on the Salesforce Tower in New York City on March 7, 2019.
    Brendan Mcdermid | Reuters

    Check out the companies making headlines in extended trading:
    Salesforce — Shares plunged more than 14% after first-quarter revenue of $9.13 billion missed consensus estimates of $9.17 billion, according to LSEG. Adjusted earnings of $2.44 per share beat a consensus estimate of $2.38, but current-quarter guidance fell below estimates on both top and bottom lines. 

    UiPath — The software company tanked 30% after saying its CEO Rob Enslin will resign, effective June 1. He will also be stepping down from the board of directors. Daniel Dines, former CEO of UiPath and current chief innovation officer, will return to the helm.
    HP Inc. — The manufacturer of personal computers rose 3%. HP posted adjusted earnings of 82 cents per share on revenue of $12.8 billion in its fiscal second quarter, above analysts’ estimates of 81 cents a share and revenue of $12.6 billion, according to LSEG.
    Pure Storage — The software company rose 1% on better-than-expected fiscal first-quarter earnings. Pure Storage posted 32 cents a share in adjusted earnings on $693.5 million in revenue. Analysts surveyed by LSEG had forecast 21 cents a share on revenue of $681 million. 
    Okta — The digital identity verification company added nearly 2% after top- and bottom-line numbers topped analysts’ estimates in the first quarter. Okta’s second-quarter revenue guidance range of $631 million to $633 million also beat the consensus estimate for $616 million, according to LSEG data. 
    Capri — The Versace and Jimmy Choo fashion group shed 3% after fiscal fourth-quarter results missed analysts’ estimates. Capri reported adjusted earnings of 42 cents a share, while analysts had estimated 65 cents, according to LSEG. Revenue of $1.22 billion also missed forecasts of $1.30 billion. Management cited softening demand for luxury goods and a slowdown in Asia. 

    C3.ai — Shares of the artificial intelligence software company climbed more than 8% after reporting quarterly results above estimates. C3.ai lost an adjusted 11 cents per share on $86.6 million in revenue. Consensus estimates had called for a loss of 30 cents on revenue of $84.4 million, according to LSEG. Full-year revenue forecasts also beat estimates. 
    American Eagle Outfitters — Shares pulled back nearly 6% after the clothing retailer’s first-quarter revenue missed estimates and it issued weak forward guidance. American Eagle Outfitters reported $1.14 billion in revenue, lower than the average analyst estimate of $1.15 billion, according to LSEG data. Earnings beat estimates, but full-year revenue guidance was in a range of 2% to 4%, compared to forecasts for 3.4%. 
    Agilent Technologies — The life sciences company tumbled 14% after lowering full-year earnings and revenue guidance. Agilent guided for earnings per share between $5.15 and $5.25 versus previous guidance of $5.44 to $5.55, according to FactSet. Revenue guidance was also pulled back to between $6.42 billion and $6.50 billion, compared to prior guidance in a range of $6.71 billion to $6.81 billion. Meanwhile, fiscal second-quarter earnings topped estimates, while revenue narrowly fell below the consensus estimate.
    Nutanix — The cloud computing company tumbled 14% after issuing its fiscal fourth-quarter revenue forecast of $530 million to $540 million that missed analysts’ estimates of $546 million. Full-year revenue guidance of $2.13 billion to $2.14 billion compared to prior forecasts of $2.12 billion to $2.15 billion, and consensus estimates of $2.14 billion, per FactSet.
    — CNBC’s Darla Mercado contributed reporting. More

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    McDonald’s exec says average menu item costs 40% more than in 2019

    A top McDonald’s executive is weighing in on claims that the company has jacked up its prices by more than 100%.
    Joe Erlinger, president of McDonald’s USA, said in an open letter the average price of a Big Mac meal today is up 27% from 2019. The price for a 10-piece McNuggets meal is up 28% over the same period, and the price of medium french fries increased 44%.
    McDonald’s has not been immune to long-awaited consumer pullbacks at restaurants.
    The fast-food giant will soon offer a $5 value meal for about a month.

    A sign is posted in front of a McDonald’s restaurant in San Leandro, California, Feb. 6, 2024.
    Justin Sullivan | Getty Images

    A top McDonald’s executive is weighing in on claims that the company has jacked up its prices.
    Joe Erlinger, president of McDonald’s USA, said in an open letter Wednesday that the average price of McDonald’s menu items is up around 40% since 2019. The breakdown comes in response to claims on social media from House Republicans, among others, that the fast-food company upped prices by more than 100%. 

    “Americans across the country are making tough calls about where to spend their hard-earned money,” Erlinger said. “And while we’ve been working hard to make sure our fans have great reasons to visit us, it’s clear that we — together with our franchisees — must remain laser-focused on value and affordability.”
    Erlinger said the average price of a Big Mac meal today is $9.29, up 27% from $7.29 in 2019. The price for a 10-piece McNuggets meal is up 28% over the same period, and the price of medium french fries increased 44%.
    Erlinger added the cost increases are tied to similar increases in input costs such as crew salaries and cost of goods.
    “For a brand that proudly serves nearly 90% of the U.S. population every year, we feel a responsibility to make sure the real facts are available,” Erlinger said.

    Consumer prices have increased 3.4% over the past year, according to the latest data from the Bureau of Labor Statistics. In response to persistently steeper costs, some consumers are pulling back across the restaurant industry, a trend that has not spared the fast-food giant.

    McDonald’s recently reported same-store sales below expectations in its first-quarter earnings report. The company will also soon offer a $5 value meal for roughly a month, beginning June 25.
    That offering will include a McChicken or McDouble, four-piece chicken nuggets, fries and a drink, CNBC previously reported.
    Analysts at BTIG characterized the promotion as being more about value perception than a profit driver.
    “In our view, this new deal is more about value perception, seeking to change the media narrative around McDonald’s recent price hikes to refocus around a deep(er) value offering. We believe the new one-month meal deal could actually hurt sales (check decline) and margins, but help reinstate McDonald’s as a value leader in the industry,” the analysts said in an investor note.
    An independent advocacy group of McDonald’s franchisees is pushing to make the discounted offering sustainable for operators, saying it will require greater investment from the company if it sticks around menus beyond the initial monthlong run.
    “There simply is not enough profit to discount 30% for this model to be sustainable. It necessitates a financial contribution by McDonalds,” the board of the National Owners Association wrote in a letter to membership that was viewed by CNBC.
    — CNBC’s Kate Rogers contributed to this report.

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    Nissan issues ‘do not drive’ alert for nearly 84,000 older models with recalled airbags

    Nissan warned owners of nearly 84,000 older vehicles to stop driving them, according to the National Highway Traffic Safety Administration.
    The warning covers certain 2002-2006 Nissan Sentra, 2002-2004 Nissan Pathfinder and 2002-2003 Infiniti QX4 vehicles that may have Takata airbags that were recalled in 2020.
    The NHTSA said the agency has confirmed that a defective Takada airbag that exploded killed 27 people and allegedly injured at least 400 others in the U.S.

    A Nissan Sentra sits on the lot of a dealership in Evanston, Illinois, on Nov. 12, 2010.
    Scott Olson | Getty Images

    Nissan has warned owners of older vehicles to drop driving cars equipped with recalled, unrepaired Takata airbags the National Highway Traffic Safety Administration announced Wednesday.
    The NHTSA said the Japanese carmaker’s “Do Not Drive” alert applies to 83,920 cars. The affected cars include 2002-2006 Nissan Sentra, 2002-2004 Nissan Pathfinder and 2002-2003 Infiniti QX4 vehicles that may have Takata airbags that were recalled in 2020.

    Nissan’s stock closed Wednesday’s session down around 3% following the warning.
    “NHTSA is urging all vehicle owners to immediately check to see if their vehicle has an open Takata airbag recall,” the NHTSA said in a statement. “If you have one of these vehicles, do not drive it until the repair is completed and the defective airbag is replaced.”

    Read more CNBC auto news

    Nissan and Infiniti will offer affected owners free towing and mobile repair, as well as loaner cars in select locations. Infiniti is a division of Nissan.
    “Due to the age of the vehicles equipped with defective Takata airbag inflators, there is an increased risk the inflator could explode during an airbag deployment, propelling sharp metal fragments which can cause serious injury or death,” a Nissan spokesperson told CNBC in a statement.
    According to the NHTSA, 27 people in the United States were confirmed to have been killed by a defective Takata airbag that exploded. At least 400 others have allegedly sustained injuries, according to the NHTSA.

    At least 67 million Takata airbag inflators have been recalled in the country, and more than 100 million have been recalled worldwide, making it one of the largest auto safety callbacks in history.
    In 2017, Takata filed for bankruptcy protection in Japan and the U.S. after agreeing to pay $1 billion in criminal penalties tied to its allegedly fraudulent conduct in the sales of its defective airbag inflators.

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    This retirement planning gap is ‘hidden in plain sight,’ Harvard professor says

    Planning for retirement often focuses on one’s finances: When to claim Social Security and how much to save in a 401(k) plan, for example.
    Investing in strong social connections, whether with a partner, friends, family or others, is arguably just as important.
    The Harvard Study of Adult Development shows that having meaningful relationships is the strongest predictor of living a long, happy and healthy life.
    It’s never too late to improve yours.

    Jose Luis Pelaez | Stone | Getty Images

    For many people, retirement planning is all about money: how to invest, how much to save, when to claim Social Security, how to best withdraw from accounts.
    Finances in retirement are an acute fear. About 2 in 3 people worry more about running out of money than about death, according to a recent poll by Allianz Life.

    Yet, there’s a notable lack of attention and concern given to the social aspect of retirement, experts said.
    It’s a facet of retirement planning that’s almost “hidden in plain sight,” said Robert Waldinger, a clinical professor of psychiatry at Harvard Medical School.
    Waldinger is the fourth director of the Harvard Study of Adult Development, which began in 1938. The study, the longest-running of its kind, has tracked thousands of Americans throughout their lives and across different generations for the past 86 years.
    A core, and perhaps surprising, finding: Having good relationships — whether with partners, friends, family or others — is the “strongest predictor” of living a long, healthy and happy life into old age, more so than health factors such as high blood pressure and cholesterol, Waldinger said.
    Money is the “obvious” focus when it comes to retirement planning, Waldinger said.

    “[But] if you want to be happy, it’s mostly not about the money,” he added.
    Put another way: “Social connections are really good for us” and “loneliness kills,” Waldinger said in a 2015 TED Talk titled “What makes a good life?” It’s one of the most-viewed TED Talks.

    How stress affects our health

    Relationships play a big role in preventing and relieving stress.
    When someone is stressed, their body revs up into a fight-or-flight mode, triggering reactions such as an increased heart rate, Waldinger said.
    Having someone to talk to or even complain to at the end of the day about a particular stressor helps the body calm down and return to equilibrium, he said.
    Someone who’s unable to do that stays in a low-level fight-or-flight mode. Higher levels of stress hormones such as cortisol build up, breaking down body systems, increasing inflammation and contributing to health issues such as arthritis, diabetes, heart disease and weakened immune function, Waldinger said.
    Loneliness and isolation are stressors in and of themselves, he said.

    The mortality impact of being socially disconnected is like smoking up to 15 cigarettes a day, the U.S. Surgeon General said in a 2023 report on the nation’s loneliness “epidemic.”
    Stressors “break down our bodies in all kinds of ways,” said David Sbarra, a psychology professor and director of the Laboratory for Social Connectedness and Health at the University of Arizona.
    People also often try to regulate the negative effects of stress via drinking, smoking or doing drugs, which are other pathways to adverse health impacts, Sbarra said.
    By contrast, having broader social networks and more social activity delays and slows cognitive decline, for example, Waldinger said. The Harvard study found that married people also lived longer than their single counterparts — five to 12 years longer for women and seven to 17 years longer for men, on average.

    Why retirement can be stressful

    The transition into retirement “is a period of stress,” Sbarra said.
    For one, there’s an “upheaval” associated with identity transition. Retirees close one chapter of their lives and must choose the contours of their next chapter, he said.
    That stress can become chronic if people don’t manage the transition well, and physical health may suffer as a result, he added.
    More from Personal Finance:Why people don’t wait to claim Social SecurityYou may be saving more in your 401(k) and not even know itWhy not to tap into retirement savings to buy a home
    Relationships and the quality of those connections “play a key role” in helping regulate stress, Sbarra said. However, the bulk of many people’s close relationship needs may be met at work, he said. In such cases, retirement strips away those interactions.
    “Some people say, ‘It’s too late for me'” to make new social connections, Waldinger said.
    “One of the things we know from study: It isn’t too late. People make all kinds of new connections and friendships when they’re older, in all phases of life,” he added.

    Does money play a role in retirement happiness?

    Portra Images | Getty Images

    Experts say finances do have a bearing on happiness in retirement, to a point.
    “You need to have your [financial needs] met,” Waldinger said.
    Just as the lack of strong social connections is a cause of stress, so is the lack, or perceived lack, of financial resources, said Yochai Shavit, director of research at the Stanford University Center on Longevity.
    However, if the goal of retirement is to live a happy, healthy and fulfilling life, social capital is as important as financial capital, he said.
    “We are very strategic when it comes to our money and planning for retirement, and perhaps not strategic in the same way … when it comes to planning our social and emotional capital,” Shavit said.

    3 steps to strengthen your relationships

    The Harvard study shows it’s not just the quantity of social connections that’s important; it’s the quality of your close relationships that matters, Waldinger said.
    For example, living amid conflict is “really bad” for our health, he said in his TED Talk. A “high-conflict” marriage without much affection is perhaps worse for health than getting a divorce, for example, he said.
    Further, loneliness is a subjective experience, he told CNBC. Some people are introverts who may only need one or two meaningful relationships, for example.
    “You can be lonely and have a ton of people around you, or not be lonely and be a hermit on a mountain,” he said.
    Near-retirees or retirees who want to assess the quality of their relationships and/or strengthen their existing connections can take three steps, Waldinger said.
    First, ask: Do I have enough people I feel connected to in my life? Am I connected to others in the way I want to be?
    “It’s really [about] checking in with yourself,” Waldinger said.  

    Second, assess whether you can improve relationships with the people already in your life whom you value and enjoy spending time with. Can you do more with what you already have?
    This could be anyone: perhaps a sibling, friends or romantic partner. For example, you could replace screen time with people time, liven up a relationship by doing something new together, such as long walks or date nights, reach out to a family member you haven’t spoken to in years. Even talking to someone on the phone, or sending a text or e-mail, can help.
    “It doesn’t have to be heavy lifting,” Waldinger said.
    Third, assess whether you can form new connections.
    Among the easiest and quickest ways to do this is by doing something you enjoy or care about alongside people you don’t know yet, Waldinger said.
    For example, join a gardening club, political campaign, church group or a campaign to prevent climate change, he said.
    It becomes easier to start conversations with new people because you have this thing in common, he added.
    The people in the Harvard study who were happiest in retirement were the ones who actively worked “to replace workmates with new playmates,” Waldinger said in his TED Talk.
    “Relationships are messy and they’re complicated, and the hard work of tending to family and friends, it’s not sexy or glamorous,” he said during that TED Talk. “It’s also lifelong. It never ends.” More

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    Jim Chanos calls suit accusing him of embezzling funds ‘baseless and defamatory’

    Jim Chanos was sued by a former partner accusing him of using his firm as a “piggy bank” with $10 million of outstanding loans that he borrowed from his company over more than a decade.
    Conlon Holdings, a Chicago-based firm run by Sean Conlon, filed the suit in New York State court Friday.

    Jim Chanos
    Scott Mlyn | CNBC

    Famed short seller Jim Chanos called a lawsuit accusing him of embezzling funds for personal use, “false, baseless and defamatory.”Chanos gave the statement to CNBC’s Scott Wapner in response to allegations made by a former investor in Chanos & Co.Conlon Holdings, a Chicago-based firm run by Sean Conlon, filed the suit in New York state court Friday, alleging that Chanos used his firm as a “piggy bank” with $10 million of outstanding loans that he borrowed from his company over more than a decade.
    “As Mr. Conlon knows, the internal loan was paid off in 2021, and since 2019 I have put over $30 million into my company,” Chanos said in the statement. “Indeed, all of my fellow management company partners have lost money over the past few years, none more than me. Mr. Conlon is simply trying to mitigate his losses by this crude shakedown attempt.”

    Conlon didn’t immediately respond to a request for comment.
    Chanos, best known for calling the collapse of energy trading company Enron, closed his hedge fund late last year and converted it to a family office and advisory business. His decision came after years of underperformance where short bets including Tesla didn’t work.
    The lawsuit also alleged that Chanos sold his Miami apartment that was formally owned by Chanos & Co. for $17.8 million earlier this month without giving his partners advance notice. Meanwhile, the suit said Chanos’ girlfriend, Crystal Conners, was the sales agent on the transaction, which would have made $540,000 at standard commission rates.
    The suit was first reported by Bloomberg News.

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    Goldman Sachs partner Beth Hammack to succeed Mester as Cleveland Fed leader

    Beth M. Hammack, 52, will take over as Cleveland Fed President when Loretta Mester steps down June 30. Hammack will take office officially on Aug. 21.
    The Cleveland Fed president plays an important role this year as a voter on the rate-setting Federal Open Market Committee.

    A Goldman Sachs executive and finance industry veteran will take over as the new president of the Cleveland Federal Reserve.
    The central bank district announced Wednesday that Beth M. Hammack, 52, will be the next leader of the central bank district when Loretta Mester steps down June 30. Hammack assumes the office officially on Aug. 21. In the interim, Cleveland Fed First Vice President Mark S. Meder will serve as the president.

    “It is a great privilege to serve the Fourth District, and the country, in fulfilling our mission of fostering a strong, stable economy in which all Americans have the opportunity to prosper,” Hammack said in a statement. “I cannot wait to lead the Bank’s talented team, who deliver every day on our important mission.”
    As the Fed contemplates its next moves with monetary policy, the Cleveland president plays an important role this year as a voter on the rate-setting Federal Open Market Committee.
    Mester mostly has been known for her more hawkish views, meaning she often has favored tighter economic policy to meet the central bank’s inflation mandate. In a recent speech, she offered several recommendations to her colleagues on improving communications, including more detailed post-meeting statements to provide greater explanation about the committee’s actions.
    Hammack comes to the Cleveland Fed after serving with Goldman Sachs since 1993 in multiple roles, having been a partner since 2010 after being named managing director in 2003. Most recently, she served as global finance director.
    She is a Stanford University graduate, holding degrees in quantitative economics and history.

    “Beth has a deep understanding of financial markets and the monetary policy transmission process, expertise in leading complex business lines, and a proven commitment to mission-focused work,” said Heidi Gartland, chief government and community relations officer with University Hospitals and chair of the presidential search committee and the Cleveland Fed’s board of directors.
    Current market pricing is pointing towards the likelihood of one interest rate reduction coming later this year, likely in November or December. At the beginning of 2024, markets were expecting at least six cuts.

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