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    Federal contractors get broad flexibility to enforce Covid vaccine rules for millions of workers

    Federal contractors will have broad leeway to enforce President Biden’s Covid-19 vaccine mandate, according to guidance the White House released Monday.
    Under the new guidance, federal contractors from IBM to Boeing will have flexibility to determine how they enforce the vaccination requirements for workers who refuse to be vaccinated.
    Federal contractors including airlines like Southwest, American and aerospace giant Boeing have said employees must be vaccinated by the Dec. 8 deadline or apply for an exemption.

    Pilots talk as they look at the tail of an American Airlines aircraft at Dallas-Ft Worth International Airport.
    Mike Stone | Reuters

    “A covered contractor should determine the appropriate means of enforcement with respect to its employee at a covered contractor workplace who refuses to be vaccinated and has not been provided, or does not have a pending request for, an accommodation,” said the guidelines, which affect millions of workers.
    The federal contractor guidelines are stricter than the forthcoming vaccine mandate for businesses with 100 or more employees, which allow for regular testing broadly as an alternative to a vaccine. The Labor Department is still finalizing those rules. Businesses have asked for that mandate to be delayed until after the holiday season over concerns about possible supply chain disruptions.

    U.S. President Joe Biden answers questions from the media in the State Dining Room at the White House in Washington, U.S., September 24, 2021.
    Evelyn Hockstein | Reuters

    The White House released the federal contractor guidance Monday after contractors sought more details on how to implement the rules. Biden issued an executive order on Sept. 9 requiring federal contractors to ensure their employees are vaccinated against Covid-19 and follow masking and social distancing policies. The administration set a Dec. 8 deadline for contractors to implement those requirements.
    Senior administration officials made clear that Dec. 8 is not a hard deadline for contractors to have all of their employees fully vaccinated. Instead, contractors must demonstrate they are making a good faith effort to ensure employees are getting vaccinated and have plans in place to ensure masking and social distancing policies are followed in the workplace.

    Federal contractors won’t have to show proof of vaccination rates at the deadline, a senior administration official said. But noncompliance could result in the loss of a federal contract.

    Federal agencies could bar a contractor employee who refuses to be vaccinated from entering a federal workplace, according to the guidelines.
    “In most circumstances individuals who are not fully vaccinated need to follow applicable masking, physical distancing, and testing protocols,” the guidelines said.
    The federal government will defer to contractors to determine when an employee has a sincerely held religious belief or medical condition that requires accommodation, according to senior administration officials. Federal contractors are not required to make a final determination on accommodation requests when an employee begins work.
    “The covered contractor may still be reviewing requests for accommodation as of the time that covered contractor employees begin work on a covered contract or at a covered workplace,” the guidelines said.
    However, federal contractors must require employees with pending accommodation requests to abide by policies on masking and social distancing while their requests are under review, according to the guidelines.
    Federal contractors including some large airlines such as Southwest and American, and aerospace giant Boeing, have said employees must be vaccinated by the Dec. 8 deadline or apply for an exemption.
    Some labor groups have opposed the mandate, including pilots’ unions at American and Southwest. The latter sought to bar the implementation of the mandate, a request a federal judge in Texas denied last week.

    CNBC Health & Science

    American and Southwest executives have softened their tone over the mandate, urging employees to apply for religious or medical exemptions if they don’t plan to get the vaccine, and said they don’t expect to terminate employees over it. Southwest last month dropped a plan to put workers with pending exemption requests on unpaid leave. Airline executives said they don’t foresee the mandate impacting flights over the holidays.
    Eleven Republican-led states sued the administration on Friday, arguing the vaccine mandate is unconstitutional. The administration has made clear that the requirements supersede any state laws that bar compliance with Covid-19 mitigation policies.

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    The bond markets v central banks

    FOR MUCH of the past two years, central bankers found themselves playing second fiddle to governments. With interest rates in the rich world near or below zero even before the pandemic, surges in public spending were needed to see economies through lockdowns. Now central bankers are firmly in the limelight. During the past month, as inflation has soared, investors have rapidly brought forward their expectations for the date at which interest rates will rise, testing policymakers’ promises to keep rates low.The expected date of lift-off in some countries is now years earlier. In the last days of October Australia’s two-year government-bond yield jumped from around 0.1% to nearer 0.8%, roughly the level at which five-year bonds traded as recently as September, prompting the Reserve Bank of Australia to throw in the towel on its pledge to keep three-year yields ultra-low. The bank formally ditched this policy of yield-curve control on November 2nd, though it said it would wait for sustained inflation to emerge before raising rates.Expectations of rate rises in Britain and Canada have also been rapidly brought forward over the past two months. The Bank of Canada announced the end of its bond-buying scheme on October 27th (though it will still reinvest the proceeds of maturing securities). The bond market had already reached the same conclusion before the announcement, and is pricing in a small interest-rate increase over the next year. In Britain, investors’ expectations for a rate rise have ratcheted up ahead of the Bank of England’s meeting on November 4th.Such moves have been mirrored in America and the euro area, albeit on a smaller scale. The Federal Reserve is expected to announce a tapering of its asset purchases after its meeting ends on November 3rd. The MOVE index, which tracks the volatility of American interest rates, is now at its highest level since the early days of the pandemic. On October 28th Christine Lagarde, the head of the European Central Bank, pressed back against growing market expectations that interest-rate increases could begin as soon as the second half of 2022, noting that an early rise would be inconsistent with the bank’s guidance. That failed to stop two-year German bond yields inching up the day after, to their highest level since January 2020.The movements so far are not large enough to constitute a bond-market tantrum on the scale of that seen in 2013, when the Fed also announced a taper. But the fact that the mood is much more febrile than it has been for most of this year reflects the uncertainty over the economic outlook, particularly that for inflation.Whether the markets prove to be right on the timing of interest-rate rises or whether central bankers can meet their original promises will depend on how persistent inflation looks likely to be. Central bankers have said that price rises so far are transient, reflecting an intense supply crunch. But some onlookers believe that a new inflationary era may be on the way, in which more powerful workers and faster wage growth place sustained pressure on prices. “Instead of decades in which labour has been coming out of people’s ears it’s going to be quite hard to find it, and that’s going to raise bargaining power,” says Charles Goodhart, a former rate-setter at the Bank of England.Recent moves also highlight the sometimes-complex relationship between financial markets and monetary policy. In normal times central bankers set short-term interest rates, and markets try to forecast where those rates might go. But bond markets may also contain information on investors’ expectations about the economy and inflation, which central bankers, for their part, try to parse. Ben Bernanke, a former chairman of the Fed, once referred to the risk of a “hall of mirrors” dynamic, in which policymakers feel the need to respond to rising bond yields, while yields in turn respond to central banks’ actions.All this makes central bankers’ lives even harder as they confront a fog of economic uncertainty. Yet there is some small relief to be had, too. If investors thought inflation had become more sustained, instead of being driven largely by commodity prices and supply-chain snarls, yields on long-dated government bonds would have begun to move significantly. So far, however, investors have dragged interest-rate increases forward rather than baking in the expectation of permanently tighter monetary policy. The ten-year American Treasury yield, for instance, is still not back to its recent highs in March.Furthermore, some bond markets are still quiescent. In Japan, consumer-price growth was just 0.2% higher in September than a year ago, and is still in deflationary territory once energy and fresh food are stripped out. The Bank of Japan’s yield-curve-control policy remains in place, contrasting sharply with the sudden collapse in Australia. Setting monetary policy is a little easier when investors are more certain of the outlook. That, sadly, is not a luxury many central bankers have. More

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    American Airlines reduces flight cancellations but staffing challenges continue to disrupt travel

    More than 136,000 customers were affected by the disruptions on Sunday, according to a company tally.
    A lack of available crew was listed as the reason for most of the cancellations, tallies from American Airlines showed.

    American Airlines on Monday canceled more than 460 flights, or 16% of its mainline schedule, as the carrier scrambled to stabilize its operation after reporting staffing shortages that led to travel disruptions for tens of thousands of people over the weekend.
    The Fort Worth-based airline canceled more than 2,300 mainline flights since Friday, blaming the issues on high winds on Thursday and a shortfall of crews. On Sunday alone, it canceled more than 1,000 flights, or 30% of its operation, according to flight-tracking site FlightAware. That affected more than 136,000 customers, according to a company document, which was viewed by CNBC.

    A lack of available crew was listed as the reason for most of the cancellations, tallies from American Airlines showed.
    The union that represents American’s flight attendants over the weekend said it received an “alarming number” of cabin crew assignments that go beyond monthly maximums.
    “The fact that there is inadequate staffing to cover the operation as it is currently structured is not the fault of Flight Attendants,” the Association of Professional Flight Attendants said in a note to members on Saturday.
    The airline didn’t provide additional comments. The carrier’s Tuesday schedule appeared closer to normal, with just 28 flights canceled, or 1% of the mainline trips scheduled, according to FlightAware.
    American’s is the latest major disruption to hit air travelers over the last few months as airlines struggle to cater to growing travel demand after urging thousands of workers to take buyouts or leaves of absence during the depths of the pandemic last year.

    Staffing shortages have made it difficult for airlines to recover from routine issues like bad weather. At the same time, many airlines ramped up schedules to capitalize on a surge in travel demand.
    Southwest Airlines said flight cancellations earlier this month cost it $75 million and forced it to cut its remaining 2021 schedule for a second time so it can avoid further strains. Spirit Airlines had similar issues over the summer that cost it about $50 million, according to the company.
    Southwest, Spirit and American have each trimmed their schedules after flight disruptions.

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    Ghislaine Maxwell loses key rulings ahead of trial for Jeffrey Epstein sex crime case

    A judge ruled that prosecutors can refer to accusers of Ghislaine Maxwell as “victims” at the British socialite’s trial on charges of procuring underage girls to be sexually abused by Jeffrey Epstein.
    Federal Judge Alison Nathan also ruled that Maxwell’s accusers can have their identities kept anonymous during the trial.
    Epstein, a former friend of ex-Presidents Donald Trump and Bill Clinton, at one time dated Maxwell, who also acted as his property manager.

    Ghislaine Maxwell on September 20, 2013 in New York City.
    Laura Cavanaugh | Getty Images

    A judge Monday ruled that prosecutors can refer to accusers of Ghislaine Maxwell as “victims” at the British socialite’s upcoming trial in New York on charges of procuring underage girls to be sexually abused by mysterious money man Jeffrey Epstein.
    Manhattan federal court Judge Alison Nathan, citing the need to protect Maxwell’s accusers from embarrassment, also ruled during a hearing that those women can have their identities kept anonymous during the trial.

    Maxwell’s lawyers had wanted prosecutors barred from using the word “victim” and “minor” to describe the accusers, and also had wanted them identified during the trial with their real names.
    Defense lawyers also lost their bid to be allowed to suggest at trial that prosecutors only filed charges against Maxwell because of press coverage about Epstein and his alleged misdeeds with her.
    Also Monday, prosecutors said they had not made any plea offer to Maxwell, such as one in which she would admit guilt to some criminal conduct in exchange for an agreement that prosecutors would seek a less severe punishment than she might get if she were to be convicted at trial.

    Prosecutors also said Maxwell likewise had not asked for a plea deal.
    “I have not committed any crime,” Maxwell, 59, said to Nathan as she confirmed that revelation at the hearing, which dealt with a raft of issues in advance of her trial, due to begin with opening arguments on Nov. 29.

    CNBC Politics

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    Why Chef Bobby Flay is now making food for cats

    Leadership Insights

    Unsure of what to feed his Maine Coon cat, Nacho, chef Bobby Flay launched his own cat food brand earlier this year called Made by Nacho.
    The pet food and treat market has grown to more than $42 billion in the U.S. as pet ownership and spending has exploded amid the pandemic.
    Pet retailers like Chewy and Petco have also seen growth as pet owners are buying more products both online and in stores.

    Chef Bobby Flay has spent his career focused on delivering high-quality ingredients and flavors to customers at his various restaurants and through his appearances on Food Network. Flay is now looking to succeed with a new audience: cats.
    The pet food market has exploded in recent years as U.S. ownership of pets now sits at an all-time high of 70% of American households, or roughly 90.5 million homes, according to the American Pet Products Association.

    Naturally, spending on pet products has also surged, growing to $103.6 billion in 2020, up 6.5% year-over-year, according to the APPA. The largest category is pet food and treats, which makes up $42 billion of that total and is up 9.7% year-over-year as more people not only adopted pets but spent more on them.
    But even Flay, a self-proclaimed “cat guy,” said wasn’t sure what meals to put in front of his two Maine Coon cats, Nacho and Stella.

    Celebrity chef Bobby Flay and his cat Nacho Flay make a radio show appearance on November 23, 2015 in New York City.
    Astrid Stawiarz | Getty Images Entertainment | Getty Images

    “I had a hard time myself trying to figure out what to feed my cats, so I sort of took it upon myself,” Flay said on CNBC’s “The Exchange.” Flay said he took inspiration from the “premiumization of human food and transferred it to the cat business.”
    While the idea started as a passion project, Flay said the goal for the Made by Nacho is “making this a real business, so that it’s not just a hobby —it’s definitely a passion, but it’s for real.”
    Flay reached out to Elly Trusedell, who was previously the global director of local brands product innovation at Amazon subsidiary Whole Foods and was the CEO of food production studio Canopy Foods, to join as his co-founder.

    In August 2020, they hired former Petco executive Julie Nelson to serve as the company’s president, helping to develop the brand’s omnichannel distribution. When the brand launched in April, Made by Nacho was available on its website and exclusively at PetSmart. Flay said the company has seen a 64% average customer return rate thus far, and also now has a subscription service for its products.
    “We had the human food business, and the cat food and pet food business, sort of covered,” Flay said.
    After several more months — during which Flay said the brand saw “immediate growth and basically week-to-week, we’re growing every week” — the company hired a CEO, Tessa Gould, a former SoulCycle and Buzzfeed executive who also served as the group CMO of Kinship, the innovation and ventures division of Mars Petcare.
    They’ve also leaned into the brand’s namesake — the seven-year-old Nacho Flay has more than 240,000 followers on Instagram.
    While Flay said the flavors of the food are geared towards the likes of cats, there are more chef-inspired ingredients and recipes such as treats made with duck liver and wild Alaskan salmon, and dried food made from grass-fed beef, rabbit, and pumpkin.

    Pet products see continued growth

    The boom in online shopping and pet ownership amid the pandemic has benefitted companies in the pet food space.
    Chewy reported a 27% increase in year-over-year revenue to $2.16 billion in its second quarter, thanks in part to customers spending even more. The company’s net sales per active customer were $404, up 13.5% compared to last year, while Chewy reported it had 20.1 million active customers, a 21.1% increase compared to last year.
    Petco saw its revenue grow 19% to $1.4 billion in the second quarter, with the company also citing increased spending as pet owners spent more time and care with their pets. “I have this theory that pets helped Americans psychologically get through his pandemic, and they bonded, and they took better care of their pets,” Petco CEO Ron Coughlin said on the company’s second quarter earnings call.
    Flay previously said on CNBC’s “Closing Bell” that he believes that “what we feed our pets is an important component for their happiness, but also for the pet parents as well to make sure that they’re eating well.”
    “Because of the pandemic, we’ve all become a lot closer to our pets,” he said. “They were an important part of my life before that, and I think over the last year we all realized how incredibly important they are to us.” More

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    Stocks making the biggest moves midday: Franklin Resources, Harley-Davidson, Roblox, GameStop and more

    A mechanic works on a motorcycle at a Harley-Davidson showroom and repair shop in Lindon, Utah, on Monday, April 19, 2021.
    George Frey | Bloomberg | Getty Images

    Check out the companies making headlines in midday trading.
    Franklin Resources — Shares of the asset manager jumped 11.6% after the company reported better-than-expected quarterly earnings. Franklin Resources also announced that it agreed to acquire private equity firm Lexington Partners for $1.75 billion.

    Align Technology — The clear braces maker popped nearly 6% after the company announced a $100 million accelerated share repurchase program. The stock is up about 23% this year.
    Moderna — Shares dropped more than 2% after the drugmaker said the Food and Drug Administration needs more time to review its Covid-19 vaccine for 12- to 17-year-olds before granting emergency use authorization. The agency is specifically studying the risk of myocarditis, or inflammation of the heart muscle, in teens. Moderna said the review may take until January to conclude.
    PG&E Corp — The gas and electric company’s shares fell 1.6% after it reported third-quarter results that missed analysts’ expectations. PG&E recorded 24 cents per share, compared with estimates of 26 cents.
    Coinbase — Shares of the cryptocurrency exchange jumped 3.6% after competing exchange Binance temporarily halted all crypto withdrawals due to a large backlog.
    Aon — The provider of risk mitigation products fell 4% after Wells Fargo Securities downgraded the stock to equal weight from overweight, citing fourth-quarter expenses despite recent strength and an increased price target by the analysts.

    Harley-Davidson — Shares of the motorcycle company jumped 9% after the U.S. and the European Union reached an agreement to weaken dueling tariffs on steel, aluminum and motorcycle imports. Wedbush Securities said in a note that the news “eliminates a significant headwind that the company has been dealing with through most of this year.”
    Spotify — Shares gained nearly 4% after the streaming platform was named a top pick at Morgan Stanley. Spotify also received an upgrade from Bernstein to market perform from underperform.
    Deere — The machinery maker jumped about 4.8% after it reached a tentative six-year deal with workers on strike that would give them higher raises and bonuses. The deal is set to be put to a vote Tuesday.
    CrowdStrike  — Shares of the cloud computing company fell 4.4% after BTIG downgraded the stock to neutral from buy, citing rising competition and potentially slowing growth.
    GameStop — The stock rose 9% after the company announced Chief Operating Officer Jenna Owens has stepped down from her role after less than a year in the position.
    Roblox — Shares of the gaming company ticked 3.4% lower in midday trading following a three-day outage on the platform that began Thursday. The online gaming site is now back online. “We are sorry for the length of time it took us to restore service,” David Baszucki, Roblox’s founder and CEO, said in a blog post Sunday.
     — CNBC’s Yun Li, Hannah Miao, Jesse Pound and Maggie Fitzgerald contributed to this report.

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    Automaker Stellantis offering buyouts to pension-eligible U.S. salaried workers

    Automaker Stellantis, formerly Fiat Chrysler, is offering voluntary buyouts to pension-eligible U.S. salaried employees, the company confirmed Monday.
    To be eligible, employees must be at least 55 years old and have been with the company for 30 years or be at least 58 years old with 10 years of employment.
    The employees being offered the packages are already eligible to retire.

    The sign is seen outside of the FCA US LLC Headquarters and Technology Center as it is changed to Stellantis on January 19, 2021 in Auburn Hills, Michigan. – Newly-created European carmaker Stellantis motored its way January 18, 2021 onto the Paris and Milan stock exchanges. Stellantis — created by the merger of France’s PSA and US-Italian rival Fiat Chrysler — is the world’s fourth-biggest automaker by volume. (Photo by JEFF KOWALSKY / AFP) (Photo by JEFF KOWALSKY/AFP via Getty Images)
    JEFF KOWALSKY | AFP | Getty Images

    DETROIT – Automaker Stellantis, formerly Fiat Chrysler, is offering voluntary buyouts to pension-eligible U.S. salaried employees, the company confirmed Monday.
    To be eligible, employees must be at least 55 years old and have been with the company for 30 years or be at least 58 years old with 10 years of employment. Unionized-salaried employees are not eligible for the buyouts, which were initially sent out at the end of October.

    A Stellantis spokeswoman declined to say how many of the company’s more than 14,000 domestic salaried employees are eligible for the program, or whether the automaker has a target for how many workers it would like to take the packages.
    The employees being offered the packages are already eligible to retire. The company cited the buyouts as a way to assist in its pivot to focus more on electric vehicles.

    “Stellantis is aggressively moving forward on its journey to become the market leader in low emission vehicles,” the company said in an emailed statement. “To assist in our transition, and to align our business priorities to a new set of critical skills and investment opportunities, Stellantis North America is offering a voluntary retirement program to eligible members of our team.”
    The targeted offers, which were first reported by Automotive News, are the most recent as U.S. automakers transition to electric vehicles. Ford Motor has offered buyouts to salaried workers at least twice since 2020. GM also announced buyouts in 2018 as part of a restructuring.
    Stellantis has 14 brands, including Jeep, Ram, Opel, Fiat, Peugeot and Maserati. During the event, it highlighted electric plans for several of its brands. It was formed through a $52 billion merger between Fiat Chrysler and PSA Groupe in January.

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    Stocks making the biggest moves after hours: Chegg, Clorox, Avis and more

    James Tahaney loads textbooks on to a pallet in preparation for shipping at the Chegg warehouse in Shepherdsville, Kentucky, April 29, 2010.
    John Sommers II | Bloomberg | Getty Images

    Check out the companies making headlines after the bell: 
    Chegg — Shares of Chegg sunk more than 25% in extended trading after a weaker-than-expected quarterly report. The education technology company reported revenue of $171.9 million versus $174.5 million estimated, according to Refinitiv. Chegg also missed subscriber estimates.

    Clorox — Clorox shares rose over 5% after hours following an earnings beat. The consumer products company reported an adjusted profit of $1.21 per share on revenue of $1.81 billion. Analysts expected earnings of $1.03 per share on revenue of $1.70 billion, according to Refinitiv.
    Avis Budget Group — Shares of Avis Budget Group rose nearly 5% in after-hours trading following a strong third-quarter earnings report. The parent company of car rental brands reported adjusted earnings per share of $10.74, much higher than the Refinitiv consensus of $6.52 per share. Revenue came in higher-than-expected at $3 billion versus $2.715 billion estimated. Avis also announced a $1 billion increase to the company’s existing share repurchase authorization.
    NXP Semiconductors — NXP Semiconductors shares whipsawed during extended trading after reporting a slight quarterly revenue beat. The chipmaker reported revenue of $2.86 billion, while analysts expected revenue of $2.85 billion, according to Refinitiv.
    Simon Property Group — Simon Property Group shares gained 3% in extended trading after the mall owner beat earnings expectations soundly. The company reported earnings of $2.07 per share versus $1.09 per share expected by analysts surveyed by Refinitv. The company’s revenue also came in higher than expected.

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