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    Target rolls back DEI initiatives, the latest big company to retreat

    Target is rolling back its diversity, equity and inclusion programs, joining major companies like Walmart, Meta and McDonald’s.
    In a memo sent to its employees, Target it will end its three-year DEI goals, stop reports to external groups like the Human Rights Campaign’s Corporate Equality Index and end a program focused on carrying more products from Black- or minority-owned businesses.
    In prior years, Target had said the murder of George Floyd in the company’s hometown of Minneapolis motivated it to strengthen its DEI programs.

    Customers exit a Target store on November 20, 2024 in Austin, Texas. 
    Brandon Bell | Getty Images

    Target on Friday said it’s rolling back diversity, equity and inclusion programs — including some that aim to make its workforce and merchandise better reflect its customers.
    In a memo sent to its employees, the Minneapolis-based retailer said it will end its three-year DEI goals, stop reports to external diversity-focused groups like the Human Rights Campaign’s Corporate Equality Index and end a program focused on carrying more products from Black- or minority-owned businesses.

    The memo was sent to staff Friday and viewed by CNBC. It was written by Kiera Fernandez, chief community impact and equity officer at Target.
    “Many years of data, insights, listening and learning have been shaping this next chapter in our strategy,” she said in the memo. “And as a retailer that serves millions of consumers every day, we understand the importance of staying in step with the evolving external landscape, now and in the future – all in service of driving Target’s growth and winning together.”
    A Target spokesperson said there are no job cuts as part of Friday’s DEI announcement.
    With the move, the discounter joins a growing list of companies including Tractor Supply, Facebook’s parent Meta, Walmart and McDonald’s that have dropped DEI-related pledges and goals. Some of those companies faced pressure from conservative activists or cited the Supreme Court’s ruling blocking affirmative action at colleges — which may not compel corporations to take any action on the issue.
    The company’s decision also follows President Donald Trump’s executive orders, made almost immediately after his Inauguration, to end the government’s DEI programs and put federal officials overseeing those initiatives on leave.

    Not all companies have joined the trend. On Thursday, Costco said at its annual meeting that more than 98% of shareholders voted against a proposal to review risks of its DEI programs. Costco’s board of director had urged shareholders to vote it down.
    Many corporations’ diversity commitments, including Target’s go back for years and were strengthened in the wake of the “Black Lives Matter” protests and the murder of George Floyd in 2020.
    Four years ago, Target CEO Brian Cornell said the murder — which happened just a short distance from Target’s headquarters in its hometown — felt personal. He said it motivated him to step up Target’s diversity and equity efforts.
    “That could have been one of my Target team members,” he said at the time, recounting his thoughts as he watched the video of Floyd taking his final breaths.
    Target expanded its diversity goals at the time, saying it would increase representation of Black employees across its workforce by 20% over the next year. The company started a new program to help Black entrepreneurs develop, test and scale products to sell at mass retailers like Target. And it promised to spend more than $2 billion with Black-owned businesses by 2025, from construction companies that build or remodel stores to advertising firms that market its brand.
    The company and its foundation also gave $10 million to support social justice groups, including the National Urban League and African American Leadership Forum.
    On its website in recent years, Target has touted Cornell’s and the company’s “steadfast commitment to stand with Black families and fight against racism.” In other posts on its website, the company provided updates on its efforts to add more officers of color, reduce turnover of people of color, and increase promotions of women and minorities.
    One post was titled “We Are Never Done,” and started off with a quote from Black poet and civil rights activist Maya Angelou.
    Target dissolved the goals at a time when conservative politicians and activists have increasingly turned their focus on company efforts to be more inclusive.
    Target had already felt the heat from conservative groups over some of its other longstanding initiatives. About two years ago, the retailer pulled items from its Pride Month collection after backlash and threats to employees about some merchandise it sold, such as “tuck-friendly” swimsuits for trans people.
    Cornell said in 2023 that the backlash contributed to weaker quarterly sales for the company. He said, however, that it would continue to mark heritage months with merchandise collections, such as Black History Month and Pride Month.
    Target’s employee base had grown more diverse in recent years.
    About 43% of Target’s workforce was white, 31% was Hispanic/Latino, 15% was Black and 5% was Asian in the fiscal year that ended in early February 2024, according to the company’s most recent diversity report.
    The company’s leadership team is less diverse than its overall workforce. Seventy-two percent of the leadership was white, followed by 11% Hispanic/Latino, 11% Asian and 6% Black.

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    American Express CFO says spending picked up at year-end, thanks to millennials and Gen Z

    American Express’ affluent cardholders got comfortable spending more freely again late last year, Chief Financial Officer Christophe Le Caillec told CNBC.
    Spending on AmEx cards jumped 8% year over year in the fourth quarter after slowing down from a 7% growth rate early in the year to 6% in the second and third quarters, according to the firm’s earnings presentation.
    The pickup was especially fueled by millennials and Gen Z users, who spent more on experiences such as travel and entertainment.

    Silas Stein | Picture Alliance | Getty Images

    American Express’ affluent cardholders got comfortable spending more freely again late last year, Chief Financial Officer Christophe Le Caillec told CNBC.
    Spending on AmEx cards jumped 8% year over year in the fourth quarter after slowing from a 7% growth rate early in the year to 6% during the second and third quarters, according to the firm’s earnings presentation.

    While the year-end pickup was seen across all customer segments and geographies, it was especially fueled by millennials and Gen Z users, where transaction volumes jumped 16%, up from 12% in the third quarter.
    Older groups were more restrained with their cards. Gen X customers spent 7% more in the fourth quarter, while baby boomers saw billings rise just 4%.
    “We had very strong growth from Gen Z and millennials, and that 2 percentage point acceleration gives us a lot of optimism for 2025,” Le Caillec said.
    Elevated transaction levels have continued into the first three weeks of this year, he added.
    Younger Americans are said to spend more on experiences rather than goods, and that is reflected in the results from AmEx, which along with rival card issuer JPMorgan Chase, dominate the market for high-end credit cards.

    Travel and entertainment billings rose 11% in the quarter, compared with 8% for good and services. The boost in travel came from airline spending, which rose 13%, with spending for business class and first class airfares up 19%, according to Le Caillec.
    AmEx shares fell more than 2% in midday trading Friday after the company reported earnings and revenue that were roughly in line with analysts’ expectations. Shares of the New York-based company have been on a tear over the past year, hitting a 52-week high on Thursday.
    “We are encouraged by accelerating billings growth as we believe it will be a key factor for Amex to meet its aspirational target of at least 10% revenue growth,” William Blair analysts led by Cristopher Kennedy wrote Friday in a research note. “We remain buyers on any pullback.”

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    Here’s what CEOs are saying about DEI at Davos

    Full Coverage

    On the ground in Davos, DEI has been the subject of conversation both on the record and behind closed doors.
    Most corporate leaders who spoke to CNBC across the first four days of the summit reiterated that while the language may change and internal policies may be tweaked, company values will remain the same.
    Here’s what the heads of JPMorgan Chase, Nasdaq, Cisco and others had to say.

    There are three buzzwords among politicians and business leaders at this year’s World Economic Forum annual meeting in Davos, Switzerland: diversity, equity and inclusion.
    It’s no surprise DEI is on corporate leaders’ minds, since it’s been front and center at the White House as well.

    “My administration has taken action to abolish all discriminatory diversity, equity and inclusion nonsense,” President Donald Trump said Thursday during a virtual appearance in Davos. “America will once again become a merit-based country.”
    Trump signed an executive order his first day in office aimed at dismantling the federal government’s diversity and inclusion programs. The order as written only applies to federal government employers, but he also mentioned extending his executive order to private institutions in his comments at Davos.
    Following his executive order, his administration has also targeted affirmative action in federal contracting and ordered all federal DEI staff be put on paid leave.
    On the ground in Davos, DEI has been the subject of conversation both on the record and behind closed doors, with discussions including the potential of ditching the commonly used acronym and changing external communication around certain policies.
    Most corporate leaders who spoke to CNBC across the first four days of the summit reiterated that while the language may change and internal policies may be tweaked, company values will remain the same.

    Here’s what executives had to say:

    Jamie Dimon, JPMorgan Chase CEO

    “We are going to continue to reach out to the Black community and Hispanic community, LGBT community, and the veteran community. … Wherever I go — red states, blue states — mayors, governors say they like what we do. So we’re not trying to pander to any which side or any which thing. Now if you point to something we’re doing that’s wrong, I’d change it. And we will make modifications going forward, but we’re very proud of what we’ve done, and what we’ve done is lift up cities, schools, states, hospitals, countries, companies, and we’re gonna do more of the same.”

    Adena Friedman, Nasdaq CEO

    “For Nasdaq, we really continue to look at everything that we do in building the right culture. We do believe that a place where we feel like people can be themselves and can operate at their highest potential, and have diversity of views, and diversity of backgrounds, actually makes us a better company and makes us perform better. So we’re going to continue to operate in that way. And I think that at the end of the day, these things come and go with different political cycles, but at the same time, I believe that there’s an undercurrent that continues to be supportive.”

    Bill Ready, Pinterest CEO

    “People on our platform come from all walks of life, from all different backgrounds, and so we’ve been very focused on how we drive inclusivity in our platform with things like inclusive AI, with things like ‘diversity by default’ in our feed … We’re not [changing anything], and the reason is we’ve seen it’s actually leading to better engagement, there’s consumer demand for it, it’s good for our business.”

    Chuck Robbins, Cisco CEO

    “I think what happened is there’s a subset of initiatives under the DEI brand that were particularly disliked. And I think the whole thing got blown up because of that … If I’m sitting in a room to try to solve a complex problem or to chase a big opportunity, I want a lot of diverse brains in that room, and I don’t care if it’s gender or if it’s nationality or if it’s just diversity of experience. Diversity in general is good for business. But I think the pendulum swung and I think it was a handful of issues that really triggered it all.”

    Robert Smith, Vista Equity Partners CEO

    “I think that diversity is a great thing in business. How do I know? Because I look at the data, I look at the facts. When we have diverse teams, our teams are more productive. We have lower risk. We’re actually able to out-produce those who don’t have diverse teams. The facts all suggest that. Now, how that gets implemented and executed, I think is where there’s dialogue and debate. I think companies and executives who actually understand the importance of diverse thinking in the work that they do, in the products that they deliver, and in the markets they serve will benefit long term … We will have to navigate through this, and there may be certain laws to change. We have to make adjustments to it, but people will do the right thing.”

    Alexandr Wang, Scale AI CEO

    “We operate in an incredibly competitive and fast-moving industry in AI, and I don’t have any option but to hire the best and most brilliant and most capable people for every single job inside my company. So as a result, we have no option but to be meritocratic … And in the process, we achieve diversity.” More

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    Universal’s ‘Wicked: For Good’ creates a unique marketing challenge

    Universal garnered 10 Academy Award nominations for “Wicked,” a boon for marketing efforts for the second part of the duology, “Wicked: For Good.”
    The film already has pent-up audience demand following a record-breaking box office run both domestically and globally.
    The overall marketing plan for “Wicked: For Good” is expected to be similar to the playbook used for “Wicked,” with a few alterations to keep it fresh and avoid oversaturating audiences.

    A still from the film “Wicked.”
    Source: Universal Studios

    Universal is hoping the excitement around “Wicked” can hang around — for good.
    The movie studio faces a unique challenge: promote and release two build-on films just one year apart. Part one of the “Wicked” cinematic project dazzled at the box office, collecting more than $700 million in global ticket sales through Sunday. Not only did it have the highest opening of any theatrical Broadway adaptation, but it is also now the highest-grossing film based on a Broadway musical, according to data from Comscore.

    The question for Universal ahead of the release of part two — “Wicked: For Good,” due out in November — is how to keep its biggest fans engaged without alienating its more casual audiences.
    Marketing experts told CNBC that pent-up demand for the movie, combined with the first film’s success, makes promoting its follow-up much easier.
    “[Generating] close to $500 million is an amazing feat for that film,” said Mike Polydoros, CEO at cinematic marketing agency PaperAirplane Media. “They have all these fans who have seen the movie over and over again and came to the sing-alongs. They’ve marked their calendars for the second part of the movie.
    “So, the marketing of it is more about keeping that group engaged and keeping them [informed] … and giving them just enough nuggets without oversaturating,” Polydoros said.
    Universal already has one thing working in its favor: When it launches the marketing campaign for “Wicked: For Good,” it will be able to add best picture Academy Award nominee to its franchise promotions.

    On Thursday, the studio snared 10 nominations for “Wicked,” including for lead actress, supporting actress, film editing, sound, score, production design, costume, visual effects and makeup and hairstyling.

    A yellow brick road map

    The overall marketing plan for “Wicked: For Good” is expected to be similar to the playbook used for “Wicked” with a few alterations to keep it fresh and avoid oversaturating audiences.
    Universal jumpstarted the first film’s advertising strategy with a teaser trailer that ran during the Super Bowl in February. The nearly 90-second spot gave fans their first glimpse of Oz, as well as Cynthia Erivo’s triumphant battle cry from “Defying Gravity,” the closing number of the first act of the Broadway musical.
    “There wasn’t a debate,” Michael Moses, Universal’s chief marketing officer, told Variety back in November. “When you’re working on materials, you always have those kinds of conversations. But if there’s a single sound associated with ‘Wicked,’ it’s certainly that end to ‘Defying Gravity.’ … Ending that spot with it felt assured and inescapably the right call.”
    The Super Bowl ad spot was followed up by another teaser trailer at the annual CinemaCon in Las Vegas in April and a quick appearance from Elphaba (Erivo) and Glinda (Ariana Grande). The co-stars attended the Met Gala in New York City a month later, walking the red carpet together and closing out the evening with a surprise performance. Then, in July, the pair were spotted at the Paris Olympics, which was televised by NBC.

    Ariana Grande and Cynthia Erivo perform onstage during the 2024 Met Gala celebrating “Sleeping Beauties: Reawakening Fashion” at the Metropolitan Museum of Art in New York City on May 6, 2024.
    Kevin Mazur/mg24 | Getty Images Entertainment | Getty Images

    “Our filmmakers and our talent were very accessible throughout this process,” said Dave O’Connor, president of franchise management and brand strategy at Universal. “Many of them participated in various parts of our campaign, from the straight marketing that we did for the film, but also with our partnerships and some of the unique opportunities that our company brought to the table. So I think that was also something that felt organic and authentic to the process.”
    Universal peppered audiences with different iterations of the film’s trailer and teaser videos throughout the summer, leading into its big marketing push — more than 400 corporate brand partnerships. Retail stores were flooded with pink and green merchandise, from apparel, accessories, footwear, beauty and costumes to home decor, toys and even one-of-a-kind cars. The collections ranged in price, allowing consumers to choose from affordable and luxury options to show off their love of all things “Wicked.”
    “I get asked a lot, ‘What is the state of exhibition?'” said Brandon Jones, president and chief marketing officer of FilmFrog. “And I think that ‘Wicked’ is the perfect example of this. The state of exhibition is, and has always been, to influence culture.”
    With nine months before the release of “Wicked: For Good,” Universal will look to repeat the success of the first film’s marketing campaign, but with some variation.
    “I think our intent would not be to replicate, but certainly to evolve and to continue to do incredible work and find the right balance of partnerships that can innovate and really match the heart of the next film,” O’Connor said.

    A ‘Wicked’ cinematic experience

    Like “Wicked,” “Wicked: For Good” arrives the weekend before Thanksgiving. This gives the film breathing room for a solid opening weekend before Disney drops its traditional animated release the day before the holiday. This year, it will be “Zootopia 2.”
    “Wicked: For Good” will then be able to capitalize on school vacations and family gatherings to fuel a strong second week of ticket sales — the same strategy employed for “Wicked” amid the surprise release of Disney’s “Moana 2” on the Thanksgiving holiday last year.
    Cinemas will also look to capitalize on the prior success of “Wicked” when promoting “Wicked: For Good.” While Universal will provide creative assets such as trailers, standees and other digital and physical materials, theaters big and small will look for ways to lure audiences to their locations with special collectible popcorn buckets and unique food and drink options.
    “Until, really, the last [decade], exhibitors just relied on studios to do most of the marketing and that really started to change around 2016 or 2017,” said Jones. “Because the relationship between the film and the moviegoer is actually managed by exhibitors. Because you don’t buy your ticket for ‘Wicked’ from Universal. You buy it from your local movie theater.”

    A poster for the movie “Wicked” outside the Vue Cinema in Leicester Square in London, U.K., on Dec. 4, 2024.
    Mike Kemp | In Pictures | Getty Images

    Jones noted that the quick release of “Wicked: For Good,” almost exactly one year after “Wicked,” allows movie theaters to engage with guests more acutely.
    Using ticket sales data, cinemas can market on a one-to-one basis during the 12-month period between releases to not only promote the second film, but also entice moviegoers to return for other in-theater programming that is similar to “Wicked.”
    “It’s one thing to market the movie, it’s another thing to market the experience of going to the movies,” Jones added.
    Disclosure: Comcast is the parent company of NBCUniversal and CNBC. NBCUniversal is the distributor of “Wicked” and owns NBC Sports and NBC Olympics. NBC Olympics is the U.S. broadcast rights holder to all Summer and Winter Games through 2032. More

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    Monte dei Paschi shares fall 8% after lender launches surprise 13-billion-euro bid for Mediobanca

    Offering 23 of its shares for 10 of its acquisition target, Monte dei Paschi values Mediobanca’s stock at roughly €15.992 each, a 5% premium to the close price of Jan. 23.
    Monte dei Paschi, the world’s oldest bank, required a state rescue in 2017 after years of crippling losses, but has turned the tides of its fortunes under the leadership of UniCredit veteran Luigi Lovaglio.
    The Friday offer adds to a picture of heating M&A appetite in Italy’s banking and financial services sector.

    Photographer | Collection | Getty Images

    Italy’s bailed-out Monte dei Paschi di Siena on Friday launched a 13.3 billion euro ($13.95 billion) all-share takeover offer for larger domestic peer Mediobanca.
    Shares of Monte dei Paschi (MPS) were down 7.97% at 11:39 a.m. London time, with Mediobanca up 6.28%.

    Offering 23 of its shares for 10 of its acquisition target, Monte dei Paschi values Mediobanca’s stock at roughly €15.992 each, a 5% premium to the close price of Jan. 23. The proposal will have to be approved at a shareholder meeting on April 17.
    The equity of Monte dei Paschi was worth 8.7 billion euros as of the Jan. 23 close, while Mediobanca’s market capitalization stood at at 12.3 billion euros, according to FactSet data.
    CNBC has reached out to Mediobanca for comment.
    Under the offer terms, Monte dei Paschi estimates pre-tax benefits of 700 million euros a year from the transaction, which would help it to leverage tax credits from previous sustained losses and add 500 million per year for the next six years.
    The lender, which intends to delist Mediobanca, hopes to close the transaction by the end of September, Monte dei Paschi CEO Luigi Lovaglio said in a briefing.

    “Mediobanca is the best fit at the best time for a powerful business combination,” he added. “We will leverage on the excellence of the two brains, preserving their unique positioning. The new Italian champion will be resilient with [a] diversified business mix.”
    In a Friday note, KBW Analysts Hugo Cruz and Ben Maher noted the proposal has “limited” synergy potential and chances of success.

    Monte dei Paschi, the world’s oldest bank, required a state rescue in 2017 after years of crippling losses, but has turned the tides of its fortunes under the leadership of UniCredit veteran Lovaglio. The Italian government retains a 11.73% stake in the lender, after decreasing its position in a bid to reprivatize the lender.
    Delfin, the holding company of late billionaire Leonardo del Vecchio, has increased its position to 9.78% since January, with business tycoon Francesco Gaetano Caltagirone now holding 5.03%. Delfin and Caltagirone are the largest shareholders of Mediobanca, with 19.8% and 7.8%, respectively.
    “The transaction could contribute to complete the dynamics of the Italian financial system, in the context of strong consolidation,” Italian banking union Fabi said after the offer announcement, according to a CNBC translation. “MPS, historically at the center of complex events, is now moving in an ambitious direction. The bid confirms, among other things, that MPS has completely recovered.”
    Amid a helpful high-interest environment, Monte dei Paschi was last year able to offer its first dividend in 13 years, posting a CET1 ratio — a measure of a bank’s strength and resilience — of 18.3% in the third quarter.
    The Friday offer adds to a picture of heating M&A appetite in Italy’s banking and financial services sector, where the country’s second-largest bank UniCredit previously offered to buy out Banco BPM, which in turn seeks to acquire fund manager Anima Holding. Monte dei Paschi was itself a potential takeover target for UniCredit until talks recently collapsed in 2021.
     — CNBC’s Silvia Amaro and Ganesh Rao contributed to this report. More

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    ‘World’s first downside protected bitcoin ETF’: Calamos unveils a safer way to play crypto

    A major exchange-traded fund provider is trying to take the volatility out of bitcoin investing.
    Calamos Investments launched the Calamos Bitcoin Structured Alt Protection ETF (CBOJ) on Wednesday. The firm brands it as “the world’s first downside protected bitcoin ETF.” It is built with risk-adverse investors in mind.

    “You can get in all day long. Get that 100% protection. And then at the end of the day, we’re going to strike the cap,” the firm’s ETF head Matt Kaufman told CNBC’s “ETF Edge” this week.” Bitcoin is a volatile asset … we don’t want the price of bitcoin to move on you overnight.”
    The firm launched the new bitcoin ETF on Wednesday. It coincides with a winning month for bitcoin. The cryptocurrency is up 10% as of late Thursday afternoon.
    According to a Calamos press release, the fund provides access to bitcoin in a risk-controlled environment.
    “Many investors have been hesitant to invest in bitcoin due to its epic volatility,” Kaufman said in the release. “Calamos seeks to meet advisor, institutional and investor demands for solutions that capture bitcoin’s growth potential while mitigating the historically high volatility and drawdowns of this fast-growing and high performing asset.”
    Calamos has more crypto funds on deck. It is set to launch Calamos Bitcoin 90 Series Structured Alt Protection ETF (CBXJ) and Calamos Bitcoin 80 Series Structured Alt Protection ETF (CBTJ) on Feb. 4, according to the Calamos website.

    ‘You’re not going to see meme coin ETFs from Calamos’

    Despite the firm’s appetite to offer cryptocurrency funds, Kaufman told “ETF Edge” there is one group Calamos will not consider.
    “You’re not going to see meme coin ETFs from Calamos. But the ability to access bitcoin in a way that meets your risk tolerance, that’s what we’re about,” Kaufman said.

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    Wealthy leaders share financial advice they gave their kids: Invest early, learn from failure — and think carefully about inheritance

    Converge Home

    Talk about money and budgeting early is the advice of wealthy CEOs and founders.
    Allow your kids to invest in something low-risk at the start and ask them to explain their rationale, leaders told CNBC.
    Talk to children in their own terms, according to Singapore-based CEO Gregory Van. Ask: “Do you want to spend $100 today on a toy, or have it turn into $200 in 10 years when you are 16?” he said.

    Sally Anscombe | Getty Images

    Entrepreneur Eric Malka had to completely shift his mindset when he sold his company and became an investor. Since then he’s learned many lessons he’s now passing to his kids.
    When The Art of Shaving — which Malka and his wife Myriam Zaoui founded in 1996 — was bought by Procter & Gamble for a reported $60 million in 2009, Malka realized he needed to educate himself.  

    “When an entrepreneur like me is lucky enough to have a liquidity event, then we’re faced … with managing assets without proper training,” he told CNBC by video call. Investors must focus on being patient and on long-term returns, whereas company founders often look at a short-term plan, “almost an opposite” mindset, Malka said.
    He took courses on wealth management, read books on investing and now has a diversified portfolio of stocks, bonds, private equity and real estate, with about 10% allocated to riskier investments. In 2014 he founded private equity fund Strategic Brand Investments.

    The lessons learned when you lose are more valuable than the ones when you succeed.

    Eric Malka
    Co-founder and CEO, Strategic Brand Investments

    When it came to educating his children — sons aged 14 and 16 — about money, Malka’s attitude has been to help them learn from the ground up.
    “One of the challenges I faced with my teenagers early on, is their belief that it’s very easy to make money by investing through social media and through what they hear from friends,” he said. His older son thought he could generate a 20% monthly return, which Malka described as “very concerning.” So, Malka let him invest a small portion of his savings, hoping it would provide an opportunity to learn — and his son lost 40% of that investment after trading currency futures.
    “I hate to set up my child for failure, but sometimes, you know, the lessons learned when you lose are more valuable than the ones when you succeed,” Malka said.

    It’s a point that resonates with Gregory Van, CEO of Singapore-based wealth platform Endowus. He and his wife have children aged eight, six and three. He said he’ll be teaching them that it’s important to make mistakes when the stakes seem large to them, though may be small in reality. “The emotional muscle, and humility required to be a good investor is something that people need to develop on their own,” he said.

    Teaching kids how to invest

    For Dayssi Olarte de Kanavos, president and co-founder of real estate company Flag Luxury Group, educating kids early about money is key.
    She and her husband allocated a “low risk” sum of money to each of their three children in middle school for them to pick companies to invest in. “Our children chose Apple, Amazon, Google and Alibaba. All but one had terrific runs. As long as they kept their money in the market and continued to be thoughtful in their approach, we added every year to their nest egg,” she told CNBC by email. 
    Olarte de Kanavos said her experience in real estate investing taught her the value of patience. “It influenced my business approach by emphasizing long-term strategy over quick gains,” she said. The mother of three described her own investments in the stock market as “very conservative, in order to best manage the huge risks that we take in our real estate business.”

    Give them an allowance no later than the first grade.

    Dayssi Olarte de Kanavos
    President and co-founder, Flag Luxury Group

    She suggested having children explain why they want to buy certain stocks, because it “can demystify investing and make it an exciting and integral part of their education,” she said.
    Van said he talks to his young kids about the tradeoffs of investing in their own terms. “I ask them: ‘If we invest this $100 and it goes down by $70 next year, how will you feel?’ ‘Do you want to spend $100 today on a toy, or have it turn into $200 in 10 years when you are 16?’,” Van told CNBC via email. “Surprisingly, they are very rational and always go for delayed gratification,” he said.
    Van and his wife have investment portfolios for each of their kids, mostly made up of gifts they’ve received during holidays such as Chinese New Year. “Given their long investment horizon, they are in very diversified, multi-manager, low-cost equities portfolios,” Van said, and he shows his children their portfolios’ performance — positive or negative — whenever they ask.

    Budgeting and saving for children

    Age-appropriate advice is very important, Malka said. His focus right now is teaching his children about budgeting, providing them with a fixed allowance per month.
    “In the beginning, you know, they would spend in 10 days what they were supposed to spend in 30 days … now I’ve been doing this for eight months or nine months, now they’re really managing it properly, and I think that’s a skill they don’t realize they’re being taught,” he said. He recommended the book “Raising Financially Fit Kids,” by Joline Godfrey, which provides advice by age-group.
    “Give them an allowance no later than the first grade,” is Olarte de Kanavos’ suggestion. “The purpose of an allowance is to allow them to learn to make their own decisions about money and to manage the repercussions that come with their choices,” she told CNBC. “As they get older, teach them about saving, the concept of interest, and the difference between good and bad debt,” she said.
    For Roshni Mahtani Cheung, CEO and founder of media company The Parentinc, long-term thinking is important. She and her husband opened a fixed-deposit account for their eight-year old daughter for the money she receives at Chinese New Year, and at Diwali she receives a gold coin. “My goal is for her to grow up financially savvy, confident, and ready to make her own decisions,” Mahtani Cheung told CNBC by email.

    Talking to kids about their inheritance

    A concern for the wealthy members of advisory network Tiger 21 is how and when to talk to their children about their inheritance. “They are most concerned about their kids leading independent productive lives and don’t want knowledge about the wealth they will inherit to distract them or take them off course,” said Tiger 21’s founder and chairman Michael Sonnenfeldt in an email to CNBC.
    Around 70% of the network’s members want to wait until their kids are close to 30 years-old and have established careers to detail what they might inherit — and when, Sonnenfeldt said. “However, about 30% of members want to begin working with their kids in their late teens or early 20s to teach them to become responsible stewards for the wealth they will inherit,” he said. Both approaches are valid, he added.
    “I suggest that parents encourage open, values-driven conversations about money and investing,” Sonnenfeldt said. More

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    Airlines flex pricing power, signaling higher fares in 2025

    Strong demand and limited capacity growth are set to push airfares higher.
    Aircraft delays have added to growth limitations.
    Some carriers have pulled back from the oversupplied domestic market.

    Travelers walk through O’Hare International Airport in Chicago on Dec. 20, 2024.
    Kamil Krzaczynski | AFP | Getty Images

    Higher airfare is in store this year as strong demand, even during the dead of winter, and limited capacity growth prompt airlines to flex their pricing power.
    Fare-tracking platform Hopper this month said domestic “good deal” U.S. airfare in January is at $304, up 12% over last year, with more domestic flights going for more than they did last year through at least June.

    Late deliveries of new aircraft from Boeing and Airbus, air traffic constraints and financial pressures have limited airlines’ ability to expand flights, which has pushed fares higher. Spirit Airlines, which filed for Chapter 11 bankruptcy protection in November, was the most dramatic case and has slashed its flights to cut costs.
    American Airlines on Thursday forecast a jump in revenue of as much as 5% in the first quarter over the same three months of 2024, while capacity will be flat or even down as much as 2%.
    “We do expect airfare to come up,” American Airlines Chief Financial Officer Devon May said in an interview. The airline forecast a wider-than-expected-loss for the first quarter, however, disappointing investors as it expects an increase in costs, such as higher wages from new labor contracts signed last year.
    Startup carrier Breeze Airways on Thursday reported its first quarterly operating profit, for the fourth quarter, and founder David Neeleman, who is also the founder of JetBlue Airways, said conservative industry growth is boding well for future results.
    “The tide is lifting a lot of boats,” he said in an interview. “We’re exceeding our targets in revenue. Momentum we saw in the fourth quarter is continuing into the first.”

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    Alaska Airlines late Wednesday said it expects revenue growth for the first quarter to rise by “high single digit” percentage points with capacity up no more than 3.5%.
    United Airlines, which had a first-quarter earnings forecast that far surpassed analysts’ expectations, shared a similar sentiment, particularly for domestic trips.

    “The domestic pricing environment is improving as underperforming airlines remove unprofitable capacity at an increasing rate and business traffic growth accelerates,” United’s Chief Commercial Officer Andrew Nocella said on the company’s earnings call on Wednesday. “Industry fare sales are less prevalent with lower discount rates as airlines are prioritizing profitability.”
    Delta Air Lines, which kicked off airline earnings season earlier this month, forecast revenue growth of 7% to 9% for the first quarter, with unit sales growing across its globe-spanning network.
    Off-season travel, particularly to Europe, has been a big bright spot for large U.S. carriers. Delta’s president, Glen Hauenstein, for example, said on the Jan. 10 earnings call that trans-Atlantic unit revenue should be up mid-single digits with demand “benefiting from strong U.S. point of sale and an extension of the season with unprecedented off-peak results.”
    Carriers are also seeing more customers buy up for roomier — and pricier — seats.
    JetBlue Airways and Southwest Airlines are scheduled to report fourth-quarter results and provide their 2025 outlooks next week. Both carriers are trying to ramp up revenue with more new premium seating and by debuting other amenities. More