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    The ADHD drug market is already stretched thin. Now it’s facing a back-to-school supply strain

    It’s been 10 months since the Food and Drug Administration first announced a nationwide shortage of Adderall — and the supply strain could potentially worsen in the months ahead.
    Some experts noted they’re concerned about market conditions as children, who are commonly affected by ADHD, head back to school. 
    It’s nearly impossible to know when the shortages will end — or what exactly can be done to resolve them — because of the lack of transparency in the pharmaceutical industry. 

    Ten milligram tablets of the hyperactivity drug, Adderall, made by Shire Plc.
    Jb Reed | Bloomberg | Getty Images

    It’s been 10 months since the Food and Drug Administration first announced a nationwide shortage of Adderall — one of the most widely used medications for attention deficit hyperactivity disorder — and the supply strain could potentially worsen in the months ahead.
    While some supply issues have improved, many Americans are still struggling to find and fill prescriptions for the drug and other medications for ADHD that they often rely on to stay focused and complete daily tasks.

    Drug-shortage experts told CNBC that it’s extremely difficult to forecast how much longer the shortages will last because of the lack of transparency in the pharmaceutical industry — and some are concerned about market conditions as children, who are commonly affected by ADHD, head back to school. 
    “Unfortunately, we might see the shortage worsen. We are heading into back-to-school time, so I am worried about it worsening as we go into that season,” Erin Fox, a pharmacist at the University of Utah and leading expert on U.S. drug shortages, told CNBC.
    Adderall is one of more than 300 drugs in short supply in the U.S. as of June, according to a list from the American Society of Health-System Pharmacists, which represents pharmacists in a variety of health-care settings. That list also includes Adderall alternatives like methylphenidate, which is commonly known under the brand names Ritalin or Concerta. 
    Adderall and alternative ADHD medications apart from other drugs are Schedule 2 controlled substances. 
    That means the federal government regulates how those drugs are made, prescribed and dispensed because they’ve been deemed to have a high potential for abuse and could potentially lead to severe psychological or physical dependence. The designation also means that patients need to get new prescriptions for those drugs every one to three months. 

    Millions of Americans in the U.S. use the drugs to help them concentrate, control their impulses and manage their schoolwork, employment or relationships with others. ADHD is usually diagnosed in childhood and often lasts into adulthood.
    An estimated 6 million children have been diagnosed with ADHD, and 60% were being treated with medication as of 2016, according to the Centers for Disease Control and Prevention. Meanwhile, around 8 million adults have been diagnosed with the condition, but only about a quarter of that number are getting treatment for it.

    Back-to-school supply strain 

    Many children and young adults with ADHD often take the summer off medication and primarily rely on it during the school year. That could lead to even more demand in the months ahead that may not be met. 
    Historically, prescriptions for ADHD medications increase as the school semester starts around the U.S. — and “there is no indication this year will be different,” according to David Margraf, a pharmaceutical research scientist at the University of Minnesota’s Center for Infectious Disease Research and Policy. 
    Some drugmakers have said they expect to resupply a few ADHD products in August or September, according to an FDA database on shortages. But Margraf said “we need to be cautiously optimistic” because drugmakers don’t disclose exact numbers of how much stock they’ll have available by then. 

    30mg tablets of Shire Plc’s Adderall XR.
    Jb Reed | Bloomberg | Getty Images

    That reflects a bigger issue with the ongoing shortages. It’s nearly impossible to know when they will end — or what exactly can be done to resolve them — because of the lack of transparency in the pharmaceutical industry. 
    “Very little factual information is out there. I think this is one of the biggest issues,” says Ozlem Ergun, a mechanical- and industrial-engineering professor at Northeastern University and an expert in pharmaceutical supply chains. “When you don’t have transparency or information sharing, how can you understand and resolve a problem that is complex?” 
    “This really, really hurts the users and the hospitals and the health-care system. They have pretty much no vision of what the future looks like,” Ergun added.  
    Teva Pharmaceuticals, Amneal Pharmaceuticals, Novartis’s planned spinoff Sandoz and Purdue Pharma subsidiary Rhodes Pharmaceuticals, which all manufacture drugs targeting ADHD, don’t need to publicly share information about where they manufacture medications, how much of them they make, where ingredients are sourced and their overall production capacities. 
    And the Drug Enforcement Administration — the federal agency that regulates controlled substances — shares little information about the production quotas it sets for each manufacturer of Adderall and other ADHD medications.
    The DEA specifically limits the amount of raw ingredients, such as amphetamine, a drugmaker can get to manufacture those drugs.
    “We don’t have the quota amount that each company is given. And we also don’t have the amount that each company is actually producing and if they’re meeting those quotas,” said Fox of the University of Utah. “There’s no way to understand which company maybe isn’t doing the job and which companies are, so we just don’t know exactly what’s going on.” 

    Production limitations

    Ending the shortages of Adderall and other ADHD medications is no easy task.
    “It’s not as simple as a free market where you just boost up production and meet demand,” said Michael Ganio, the senior director of pharmacy practice at the American Society of Health-System Pharmacists. 
    Many manufacturing plants operate at or near capacity and create multiple drug products. That means increasing the production of one drug could potentially require reducing production — and potentially impacting supply — of another drug, according to Ergun. 
    “In general, it is difficult to increase the manufacturing capacity for a drug,” she said. “There isn’t much unutilized capacity anywhere.”
    It’s even harder to scale up the production of tightly controlled ADHD medications.
    Drugmakers can request for the DEA to increase their production quotas if necessary, but it takes “a lot of push” for the agency to actually approve that, according to Margraf. 
    And even if the DEA does approve a quote change, it could take months to do so: “It’s not just flipping a switch and boosting your output by 20%,” ASHP’s Ganio said. 

    Members of the Drug Enforcement Administration raided two homes side-by-side, in an assumed illegal marijuana operation, on January 31, 2019 in Commerce City, Colorado.
    RJ Sangosti | MediaNews Group | The Denver Post via Getty Images

    Some drugmakers have suggested that DEA quotas are contributing to the ADHD medication shortages or making it harder to alleviate them. That includes Aytu BioPharma, which makes an ADHD drug that used to be in shortage. 
    In a CNBC op-ed in February, Aytu CEO Josh Disbrow said the DEA could potentially cause widespread drug shortages if it underestimates demand and fails to increase quotas in a “timely manner in response to new information.” 
    However, the DEA and FDA pointed to a different problem in a joint letter released earlier this month. 
    The agencies said an internal analysis found that drugmakers fell 30% short of meeting the full quota for amphetamine medications in 2022, leaving about 1 billion potential drug doses on the table. They added that there’s a “similar trend” occurring this year. 
    The DEA and FDA said they called on manufacturers to confirm they are working to increase production to meet their allotted quotas.
    “There’s obviously a lot of finger-pointing going on here between the agencies and manufacturers,” Fox said. 

    Surging demand for Adderall

    The shortages of Adderall and generic versions of the drug kicked off last August, when major manufacturers reported that their medications were on back-order. 
    Manufacturers are required to notify the FDA of a shortage, but not the cause of the interruption. However, the FDA pointed to “ongoing intermittent manufacturing delays” at Teva when it first announced the Adderall shortage. 
    Teva previously said the manufacturing slowdown was partly tied to a labor shortage, which was quickly resolved. Teva did not immediately respond to CNBC’s request for comment about the state of its Adderall manufacturing. 
    A surge in demand for Adderall and other ADHD medications seems to have played a significant role, too. 
    U.S. prescriptions for Adderall rocketed to 41.4 million in 2021, a more than 10% increase from 2020, according to IQVIA, a health industry analytics firm. 
    One possible factor sending demand up, according to experts, was the increased use of telehealth services during the Covid public health emergency that may have allowed for more relaxed prescribing standards for ADHD medications.
    The pandemic also created a perfect storm of distractions — such as the shift to remote work and a thrum of anxiety, stress and grief over the uncertainty of Covid — that may have exacerbated some ADHD patients’ symptoms or convinced more people that they have the condition, prompting them to seek treatment. 
    The increased demand for Adderall amid shortages of the drug likely resulted in a domino effect, too, with health-care providers and patients being driven to turn to alternative medications, triggering shortages of those drugs as well. More

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    SpaceX launches Crew-7 mission, the company’s 11th carrying astronauts

    SpaceX launched four people to the International Space Station from Florida as Elon Musk’s company begins its 11th human spaceflight mission to date.
    Known as Crew-7, the mission for NASA will bring the group up to the space station for a six-month stay in orbit.
    The mission brings the number of astronauts SpaceX has launched to 42 since its first crewed launch in May 2020.

    SpaceX’s Falcon 9 rocket with the company’s Crew Dragon spacecraft on top is seen after sunset at Launch Complex 39A ahead of the launch of the Crew-7 mission.
    Joel Kowsky / NASA

    SpaceX launched four people to the International Space Station from Florida as Elon Musk’s company begins its 11th human spaceflight mission to date.
    Known as Crew-7, the mission for NASA will bring the group up to the space station for a six-month stay in orbit. The mission is SpaceX’s sixth operational crew launch for NASA to date, and the first of the additional missions the agency awarded SpaceX.

    Crew-7 launched in the early hours of Saturday morning from NASA’s Kennedy Space Center, beginning a nearly one day journey to the ISS.

    Sign up here to receive weekly editions of CNBC’s Investing in Space newsletter.

    The mission brings the number of astronauts SpaceX has launched to 42, including both government and private missions, since its first crewed launch in May 2020.
    Crew-7 consists of NASA astronaut Jasmin Moghbeli as the commander, European Space Agency astronaut Andreas Mogensen from Denmark as the pilot, and Japan Aerospace Exploration Agency astronaut Satoshi Furukawa and Roscosmos cosmonaut Konstantin Borisov as mission specialists.

    (From L) Roscosmos cosmonaut Konstantin Borisov, European Space Agency astronaut Andreas Mogensen, NASA astronaut Jasmin Moghbeli, and Japan Aerospace Exploration Agency astronaut Satoshi Furukawa, wearing SpaceX spacesuits wave as they prepare to board the SpaceX Dragon spacecraft for the Crew-7 mission launch, at NASA’s Kennedy Space Center in Florida, on Aug. 26, 2023.
    Gregg Newton | AFP | Getty Images

    SpaceX launched the astronauts in its Crew Dragon capsule called Endurance, on top of a Falcon 9 rocket. Both the rocket and capsule are reusable, with the Endurance flying on its third mission to date.
    The company is under contract for 14 missions under NASA’s Commercial Crew program.
    SpaceX developed its Crew Dragon spacecraft and fine-tuned its Falcon 9 rocket under NASA’s program, competing against Boeing’s Starliner capsule. But Boeing’s capsule remains in development, with costly delays putting the start of operational Starliner flights years behind schedule. More

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    Mega pickleball merger between Major League Pickleball and PPA is in jeopardy

    The Professional Pickleball Association and Major League Pickleball are now at odds after announcing in November that they would join forces and merge team competition leagues.
    The PPA told CNBC that MLP has not yet signed the partnership deal they verbally agreed to 10 months ago.
    In the last year, MLP has seen continued growth with new, high-profile ownership groups, growing team valuations, new sponsorships and media deals.

    Season One Super Finals at the Life Time Rancho San Clemente in San Clemente, California. The Seattle Pioneers play the Los Angeles Mad Drops in the Premier League mixed doubles competition.
    Source: Major League Pickleball

    There’s trouble in pickleball paradise.
    The Professional Pickleball Association and Major League Pickleball are now at odds after announcing in November that they would join forces and merge team competition leagues.

    The PPA told CNBC that MLP has not yet signed the partnership deal they verbally agreed to 10 months ago. PPA owner Tom Dundon and MLP owner Steve Kuhn had agreed to operate the joint league under the MLP brand name and format. Terms of the agreement were not disclosed at the time.
    “I don’t know what Steve Kuhn’s intentions were the entire time,” Connor Pardoe, PPA Tour CEO told CNBC. “I don’t know if he led us down a road to get access to our players to try to be in a stronger position here later.”
    Pardoe claims MLP executives have recently gone radio silent. He also said PPA was made aware by some of its players that MLP had begun reaching out with lucrative offers. He said PPA would consider litigation if MLP were to improperly poach players.
    Kuhn told CNBC that there are “numerous misrepresentations of reality” taking place, without providing specifics.
    On Thursday, MLP announced it has begun to sign top players to multi-year, guaranteed contacts. The deals include a player off-season and enhanced financial security.

    “We think this is a great thing that will make MLP more valuable. So we’ll make the players lives more successful and better. And we’ll also continue to elevate the sport and help the sport grow,” said Kuhn.
    He said if the PPA is willing to pay their players more, he’s willing to talk about aligning with the league.
    “We asked the PPA to join us in paying players more, and their reaction was that we pay the players too much,” Kuhn told CNBC.
    In the last year, MLP has seen continued growth with new, high-profile ownership groups, growing team valuations, new sponsorships and media deals. In July, MLP announced Julio DePietro was taking over as CEO. He took over negotiations of this deal from Zubin Mehta, who resigned from the board.
    The competing leagues have had a complicated relationship.
    The PPA historically has acted as a tour-style league for the best players in the world. Two  years ago, Kuhn introduced team style pickleball. Since then, the two leagues have operated independently. More

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    Stocks making the biggest moves midday: Nordstrom, Hasbro, Hawaiian Electric, Affirm and more

    Shoppers walk by a Nordstrom sign at Westfield San Francisco Centre in San Francisco, May 11, 2023.
    Justin Sullivan | Getty Images

    Check out the companies making the biggest moves midday:
    Nordstrom — The department store retailer sank 7.73% even after topping fiscal second-quarter earnings and revenue expectations. Earnings came in 40 cents ahead of the 44 cents expected by analysts polled by Refinitiv. Sales fell below pre-pandemic levels and Nordstrom stood by its previous full-year outlook bracing for a decline in revenues in the single digits. The company also warned that theft-related losses are at “historical highs.”

    Affirm — The buy now, pay later firm saw its shares skyrocket 28.82% after the company reported fiscal fourth-quarter results that topped expectations on the back of higher gross merchandise volume. Affirm also gave strong guidance for the fiscal first quarter, projecting $430 million to $455 million in revenue, versus analysts’ expectations of $430 million.
    Hawaiian Electric — The utility stock plunged 18.55% following news that Maui County is suing the company for damages related to the island’s wildfires, which killed more than 100 people. The suit alleges Hawaiian Electric left its power lines energized despite a warning from the National Weather Service that high winds and drought conditions created a high fire risk. The company told NBC News it is disappointed the county chose a litigious path and noted the investigation is still unfolding.
    Hasbro — The toy maker’s stock rallied 5.66% after Stifel boosted its price target to $94 from $79 Thursday, implying about 43% upside from Thursday’s close. The Wall Street firm also added it to its top picks list, citing key changes and opportunities within the company. On Tuesday, Bank of America upped its price target to $90 from $85. Shares are up nearly 9% week to date.
    Advance Auto Parts — Shares fell 5.64% after the auto parts retailer was dropped from the S&P 500 on Friday.
    Workday — The stock gained nearly 5.38% following the enterprise software company’s stronger-than-expected results for the second quarter. Adjusted earnings per share came in at $1.43, topping the $1.26 expected by analysts, per Refinitiv. Revenue was $1.79 billion, versus the $1.77 billion expected.

    Intuit — Shares added 4.12% and hit a 52-week high after the software company’s earnings topped expectations. Fiscal fourth-quarter adjusted earnings were $1.65 per share, compared with the $1.44 expected by analysts polled by Refinitiv. Revenue came in at $2.71 billion, beating the $2.64 billion expected. The company also shared stronger-than-expected full-year guidance.
    Gap — The retailer added 7.24% after posting mixed quarterly results. Adjusted earnings per share was 34 cents, topping the consensus estimate of 9 cents, per Refinitiv. Gap’s revenue was $3.55 billion, below the $3.57 billion expected.
    Marvell Technology — Marvell shed 6.62% despite posting a slight earnings beat. Earnings per share came in at 33 cents for its second quarter, versus the 32 cents expected, according to Refinitiv. Revenue was $1.34 billion, compared with the $1.33 billion consensus estimate.
    Ulta Beauty — The beauty retailer’s shares fell 3.69%, reversing earlier gains from its better-than-expected quarterly results. Ulta posted $6.02 in earnings per share on $2.51 billion in revenue in the second quarter. Analysts had forecast $5.85 in earnings per share and $2.51 billion in revenue, according to Refinitiv. The company also raised its full-year guidance.
    AMC Entertainment — Shares fell 13.5% after the company converted its preferred equity units into common stock.
    Shift4 Payments — The payment company climbed 1.9% following a Morgan Stanley upgrade to equal weight from underweight. The firm said the company has a valuation that now better reflects the business.
    — CNBC’s Yun Li, Hakyung Kim, Alex Harring, Samantha Subin and Michael Bloom contributed reporting. More

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    Op-Ed: Less affordable homes don’t just ruin American dreams, they’re a threat to the economy

    Maintenance workers in front of a housing development sign near new homes in Fairfax, Virginia, on August 22, 2023.
    Andrew Caballero-Reynolds | AFP | Getty Images

    Being able to buy a home keeps getting harder.
    The National Association of Realtors said earlier this month that its housing affordability index fell during the second quarter to its lowest level on record. The reading came in at 92.7 compared with 101.8 in the first quarter. It’s also well below a 180.4 level reached in 2021.

    A reading of 100 signals that families earning the median income have the amount of money needed to buy a median-priced home. A reading below points to insufficient median family income to buy a home. The data goes back to 1986.
    Incredibly, housing is now less affordable than it was prior to the Great Financial Crisis — when a complete breakdown in lending standards led to a frenzy of speculation that ended in a 33% peak-to-trough decline in housing prices (based on the S&P Case-Shiller 20-City home price index) from July 2006 to April 2009.
    Should this make us nervous? 

    Arrows pointing outwards

    The decline in housing affordability has obviously been highly influenced by the huge increase in mortgage rates, which are now around 7.2%, according to data from Freddie Mac. That’s compared to an average of 4% from the end of the Great Recession in 2009 until the end of 2021. 

    In fact, current mortgage rates are nearly triple the level they were at the end of 2020 and beginning of 2021 — when they bottomed out at around 2.7%. Not coincidentally, the first quarter of 2021 turned out to the be peak in housing affordability. 
    Since then, housing prices are up 28% despite the massive increase in interest rates. Median household income, which is currently growing at roughly the pre-Covid rate, has not grown nearly fast enough to offset the spike in mortgage rates and the increase in housing prices. The consequence has been the massive drop in housing affordability to new lows. 
    I know all the arguments.
    A Wall Street Journal article on Wednesday entitled “How High a Rate Can Housing Take?” by Justin Lahart read: “On Wednesday, the National Association of Realtors reported that there were just 980,000 existing single-family homes for sale last month. That was the fewest during the month of July—normally a time of year when a lot of homes are on the block—on record stretching back to 1982.”
    Housing prices remain elevated because there is an extreme lack of supply. Inventories of homes for sale are very low because nobody wants to move and give up their 3% mortgage. The trend toward “work-from-home” is another factor causing homeowners to remain in place and therefore suppressing housing inventory. 
    It will take years to bring housing supply back in line with demand because new home construction has been insufficient since the great financial crisis. Lending standards have improved dramatically since before the GFC. 
    The typical homeowner has much more equity than in the past. Interest rates should start coming down next year as it becomes clearer than inflation is on a sustainable path lower to the Federal Reserve’s 2% target. And so on. 
    All of this is likely true. But still, housing affordability is as low as it’s been since at least 1986. Many prospective first-time buyers are at risk of getting locked out of the market forever if something doesn’t change. 
    Can insufficient supply alone keep housing prices elevated in the face of such a big increase in borrowing costs? Is it realistic to think everyone will remain in place indefinitely just to keep their low mortgage rate, thereby preventing a flood of supply hitting the market? Will political pressure on the Fed compel the central bank to cut rates more quickly, thereby improving affordability? 
    These are all important questions, and I don’t have all the answers. My suspicion is that some combination of labor market softening, tighter bank lending standards, capital markets volatility and rising mortgage rates will bring an end to the Fed’s interest rate hikes sooner rather than later. Since as long as I can remember, the Fed has always chosen the path of least pain, and I don’t think this time will be any different. 
    If this means the Fed will implicitly adopt an inflation target above 2% for a short period, then I think that’s what is likely to happen. But ultimately, I continue to believe that the Fed’s interest-rate hikes to date will prove more than enough to slow the economy, reduce inflation to target and potentially induce a recession. 
    The “long and variable lag” has proven longer than expected, in no small part because homeowners wisely locked in super-low mortgage rates when they had the chance. But fixed-rate mortgages won’t be enough to nullify the impact of 525 basis points of interest-rate hikes in a historically short period of time. 
    Given its importance to the wider economy, a robust housing market will likely be a precondition to achieving a relatively seamless transition to long-term economic expansion. The housing affordability crunch is, and looks to continue to be, a risk factor that could not only hold back the economy’s growth potential but also cause a financial crisis if left unchecked. So, add another ball to the Fed’s juggling act. More

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    Fed Chair Powell calls inflation ‘too high’ and warns that ‘we are prepared to raise rates further’

    While acknowledging that progress has been made, the central bank leader said inflation is still above where policymakers feel comfortable.
    The speech resembled remarks Powell made last year at Jackson Hole, during which he warned that “some pain” was likely as the Fed continues its efforts to pull runaway inflation back down to its 2% goal.
    A strong economy and decelerating inflation also give the Fed room to “proceed carefully” at upcoming meetings.

    Federal Reserve Chair Jerome Powell on Friday called for more vigilance in the fight against inflation, warning that additional interest rate increases could be yet to come.
    While acknowledging that progress has been made and saying the Fed will be careful in where it goes from here, the central bank leader said inflation is still above where policymakers feel comfortable. He noted that the Fed will remain flexible as it contemplates further moves, but gave little indication that it’s ready to start easing anytime soon.

    “Although inflation has moved down from its peak — a welcome development — it remains too high,” Powell said in prepared remarks for his keynote address at the Kansas City Fed’s annual retreat in Jackson Hole, Wyoming. “We are prepared to raise rates further if appropriate, and intend to hold policy at a restrictive level until we are confident that inflation is moving sustainably down toward our objective.”
    The speech resembled remarks Powell made last year at Jackson Hole, during which he warned that “some pain” was likely as the Fed continues its efforts to pull runaway inflation back down to its 2% goal.
    But inflation was running well ahead of its current pace back then. Regardless, Powell indicated it’s too soon to declare victory, even with data this summer running largely in the Fed’s favor. June and July both saw easing in the pace of price increases, with core inflation up 0.2% for each month, according to the Bureau of Labor Statistics.
    “The lower monthly readings for core inflation in June and July were welcome, but two months of good data are only the beginning of what it will take to build confidence that inflation is moving down sustainably toward our goal,” he said.
    Powell acknowledged that risks are two-sided, with dangers of doing both too much and too little.

    “Doing too little could allow above-target inflation to become entrenched and ultimately require monetary policy to wring more persistent inflation from the economy at a high cost to employment,” he said. “Doing too much could also do unnecessary harm to the economy.”
    “As is often the case, we are navigating by the stars under cloudy skies,” he added.
    Markets were volatile after the speech, but stocks powered higher later in the day and Treasury yields were mostly up. In 2022, stocks plunged following Powell’s Jackson Hole speech.
    “Was he hawkish? Yes. But given the jump in yields lately, he wasn’t as hawkish as some had feared,” said Ryan Detrick, chief market strategist at the Carson Group. “Remember, last year he took out the bazooka and was way more hawkish than anyone expected, which saw heavy selling into October. This time he hit it more down the middle, with no major changes in future hikes a welcome sign.”

    A need to ‘proceed carefully’

    Powell’s remarks follow a series of 11 interest rate hikes that have pushed the Fed’s key interest rate to a target range of 5.25%-5.5%, the highest level in more than 22 years. In addition, the Fed has reduced its balance sheet to its lowest level in more than two years, a process which was seen about $960 billion worth of bonds roll off since June 2022.
    Markets of late have been pricing in little chance of another hike at the September meeting of the Federal Open Market Committee, but are pointing to about a 50-50 chance of a final increase at the November session. Projections released in June showed that almost all FOMC officials saw another hike likely this year.
    Powell provided no clear indication of which way he sees the decision going.
    “Given how far we have come, at upcoming meetings we are in a position to proceed carefully as we assess the incoming data and the evolving outlook and risks,” he said.
    However, he gave no sign that he’s even considering a rate cut.
    “At upcoming meetings, we will assess our progress based on the totality of the data and the evolving outlook and risks,” Powell said. “Based on this assessment, we will proceed carefully as we decide whether to tighten further or, instead, to hold the policy rate constant and await further data.”
    The chair added that economic growth may have to slow before the Fed can change course.
    Gross domestic product has increased steadily since the rate hikes began, and the third quarter of 2023 is tracking at a 5.9% growth pace, according to the Atlanta Fed. Employment also has stayed strong, with the jobless rate hovering around lows last seen in the late 1960s.
    “The basic thought that they’re close to done, they think they probably have a little bit more to do … that is the story they’ve been telling for a little while. And that was the heart of what he said today,” said Bill English, a former Fed official and now a Yale finance professor.
    “I don’t think this is about sending a signal. I think this is really where they think they are,” he added. “The economy has slowed some but not enough yet to make them confident inflation is going to come down.”
    Indeed, Powell noted the risk of strong economic growth in the face of widespread recession expectations and how that could make the Fed hold rates higher for longer.
    “It was a balanced but not trend-changing speech, even if the Fed kept the ‘mission accomplished’ banner in the closet,” said Jack McIntyre, portfolio manager at Brandywine Global. “It leaves the Fed with needed optionality to either tighten more or keep rates on hold.”

    Getting into details

    While last year’s speech was unusually brief, this time around Powell provided a little more detail into the factors that will go into policymaking.
    Specifically, he broke inflation into three key metrics and said the Fed is most focused on core inflation, which excludes volatile food and energy prices. He also reiterated that the Fed most closely follows the personal consumption expenditures price index, a Commerce Department measure, rather than the Labor Department’s consumer price index.
    The three “broad components” of which he spoke entail goods, housing services such as rental costs and nonhousing services. He noted progress on all three, but said nonhousing is the most difficult to gauge as it is the least sensitive to interest rate adjustments. That category includes such things as health care, food services and transportation.
    “Twelve-month inflation in this sector has moved sideways since liftoff. Inflation measured over the past three and six months has declined, however, which is encouraging,” Powell said. “Given the size of this sector, some further progress here will be essential to restoring price stability.”

    No change to inflation goal

    In addition to the broader policy outlook, Powell honed in some areas that are key both to market and political considerations.
    Some legislators, particularly on the Democratic side, have suggested the Fed raise its 2% inflation target, a move that would give it more policy flexibility and might deter further rate hikes. But Powell rejected that idea, as he has done in the past.
    “Two percent is and will remain our inflation target,” he said.
    That portion of the speech brought some criticism from Harvard economist Jason Furman.
    “Jay Powell said all the right things about near-term monetary policy, continuing to hope for the best while planning for the worst. He was appropriately cautious on inflation progress & asymmetric about the policy stance,” Furman, who was chair of the Council of Economic Advisers under former President Barack Obama, posted on X, the social media site formerly known as Twitter. “But wish he had not ruled out shifting the target.”
    On another issue, Powell chose largely to stay away from the debate over what is the longer-run, or natural, rate of interest that is neither restrictive nor stimulative – the “r-star” rate of which he spoke at Jackson Hole in 2018.
    “We see the current stance of policy as restrictive, putting downward pressure on economic activity, hiring, and inflation,” he said. “But we cannot identify with certainty the neutral rate of interest, and thus there is always uncertainty about the precise level of monetary policy restraint.”
    Powell also noted that the previous tightening moves likely haven’t made their way through the system yet, providing further caution for the future of policy. More

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    Wegovy helps reduce heart failure symptoms in obese people, study says

    Wegovy, the popular weight loss drug from Novo Nordisk, significantly reduced symptoms of a common type of heart failure in patients with obesity, according to a late-stage clinical trial.
    The treatment also resulted in lower blood pressure and reductions in inflammation – two important markers of heart health. 
    The results add to Wegovy’s growing list of potential health benefits beyond shedding unwanted pounds, which could potentially lead to increased coverage by insurers. 

    A selection of injector pens for the Wegovy weight loss drug are shown in this photo illustration in Chicago, Illinois, March 31, 2023.
    Jim Vondruska | Reuters

    Wegovy, the popular weight loss drug from Novo Nordisk, significantly reduced symptoms of a common type of heart failure in patients with obesity, according to a late-stage clinical trial released Friday. 
    Wegovy helped alleviate symptoms like shortness of breath, fatigue, swelling in the legs and irregular heart beat. It also resulted in lower blood pressure and reductions in inflammation – two important markers of heart health. 

    The results add to Wegovy’s growing list of potential health benefits beyond shedding unwanted pounds. That could potentially lead to expanded use of the drug and increased coverage by insurers. The results also complement the groundbreaking trial data Novo Nordisk released earlier this month, which found that Wegovy slashed the risk of serious heart-related problems by 20%. 
    “We look forward to working closely with the clinical community and regulators to help realise this potential over the coming months,” Martin Lange, Novo Nordisk’s head of development, said in a release. He was referring to the heart health benefits observed in both trials. 
    The new study on 529 obese patients focused on a heart condition known as preserved ejection fraction, or HFpEF – a condition that comprises roughly half of all heart failure cases in the U.S. and occurs when the heart’s lower chamber pumps less blood than the body needs.
    An estimated 2.5 million people in the U.S. have that condition and more than 80% of those patients also have obesity. 
    The study, published in the New England Journal of Medicine, found that Wegovy led to a nearly 17-point improvement on a 100-point scale that’s used to assess symptoms of HFpEF. 

    By comparison, patients who received a placebo had a 9-point improvement.
    Wegovy also led to improvements in physical limitations: Patients who took the drug were able to walk further in six minutes than those in the placebo group. 
    Those on Wegovy also lost about 13% of their body weight, compared with 2.6% for those on a placebo, over the course of the year-long trial.
    There were fewer serious safety events in patients who took Wegovy compared with those who took the placebo. But more patients stopped taking Wegovy because of gastrointestinal issues, which are commonly observed with other weight loss drugs. 

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    One limitation of the trial was its lack of diversity: 96% of the participants were white.
    Wegovy and Novo Nordisk’s diabetes drug Ozempic sparked a weight loss industry gold rush last year for helping patients lose unwanted weight. They are part of a class of drugs called GLP-1 agonists, which mimic a hormone produced in the gut to suppress a person’s appetite. 
    But Novo Nordisk is grappling with supply constraints that have led to shortages of both drugs. 
    There are also recent reports of patients who had suicidal and self-harm thoughts after taking Wegovy and other weight loss drugs, which raised questions about the unintended and potentially life-threatening side effects of the treatments More

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    UAW workers overwhelmingly vote to authorize strikes at GM, Ford, Stellantis

    UAW members overwhelmingly granted union leaders authorization to call strikes during ongoing contract negotiations with GM, Ford and Stellantis, if warranted.
    The “strike authorization vote” is part of the union’s constitution and viewed as a procedural step in the negotiations.
    UAW President Shawn Fain has been far more vocal than past union leaders about its ability to use work stoppages as a weapon in its arsenal against the companies during the negotiations.

    Striking United Auto Workers members and supporters attend a speech by Vermont Sen. Bernie Sanders outside General Motors’ Detroit-Hamtramck Assembly plant on Sept. 25, 2019 in Detroit.
    Michael Wayland / CNBC

    DETROIT – United Auto Workers members overwhelmingly granted union leaders authorization to call strikes during ongoing contract negotiations with General Motors, Ford Motor and Stellantis, if warranted.
    The union on Friday said an average of 97% of combined members at the automakers approved the action, however final votes are still being tallied. That’s in line with support during negotiations four years ago, when 96% of workers who voted supported authorization for a strike.

    The “strike authorization vote” is part of the union’s constitution and viewed as a procedural step in the negotiations. The voting results are historically high in support of the authorization. The vote does not mean there will or will not be a strike.
    “Our goal is not to strike. I want to make that very clear. Our goal is to bargain good agreements for our members,” UAW President Shawn Fain said Friday during a Facebook Live. “But all we’ve tried to do with this is prepare everybody in the event that we have to take action to get a fair and just contract.”
    However, Fain has been far more vocal than past union leaders about its ability to use striking as a weapon in its arsenal against the companies during the negotiations.
    “The Big Three is our strike target. And whether or not there’s a strike — it’s up to Ford, General Motors and Stellantis, because they know what our priorities are. We’ve been clear,” Fain has said.

    UAW President Shawn Fain (right) speaks with union member Jerome Buckley outside of General Motors’ Factory Zero plant on July 12, 2023, in Detroit.
    Michael Wayland / CNBC

    Those priorities are far richer than during prior contract negotiations between the two sides. The union’s demands include a 46% wage increase, restoration of traditional pensions, cost-of-living increases, reducing the workweek to 32 hours from 40 and increasing retiree benefits.

    The UAW said 98% of hourly workers and 99% of salaried workers at Ford voted in favor of the strike authorization. GM passed by 96%, while the action was approved at Stellantis by 95%. Voter turnout and how many votes still needed to be counted was not immediately available.
    Strikes could take various forms, including a national strike, where all workers under the contract cease working, or targeted work stoppages at certain plants over local contract issues. A strike against all three automakers, as Fain has alluded to, would be the most impactful but also the riskiest and most costly for the union.
    The UAW has more than $825 million in its strike fund, which it uses to pay eligible members who are on strike. The strike pay is $500 per week for each member — up from $275 per week last year.
    Assuming 150,000 or so UAW members covered by the contracts, strike pay would cost the union about $75 million per week. A fund of $825 million, then, would cover about 11 weeks. One caveat: that doesn’t include health-care costs that the union would cover, such as temporary COBRA plans, that would likely drain the fund far more quickly.
    National or targeted strikes at any of the automakers could be detrimental to business. A 40-day strike against GM during the last round of negotiations in 2019 led to a production loss of 300,000 vehicles, the company said at the time. It also cost the automaker $3.6 billion in earnings, GM said. More