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American and United are among the airlines that have discouraged travelers from using their staff travel perks to Europe with free seats scarce.
London Heathrow and other European airports have established passenger caps to help stem overcrowding at the country’s largest airport.
American and United have blocked staff’s use of buddy passes to London.

International passengers walk through the arrivals area at Terminal 5 at Heathrow Airport on November 26, 2021 in London, England.
Leon Neal | Getty Images News | Getty Images

Airlines want people to take a European vacation this summer — as along it’s not their employees.
Carriers are discouraging their staff from using their employee perks for travel to and from some of Europe’s biggest airports, warning that getting a seat home will be difficult.

The moves come as airport labor shortages and industry strikes have made European summer travel challenging, just as airlines were hoping to capitalize on higher bookings after a Covid pandemic slump of more than two years.
American Airlines has barred staff from only using their flight benefits for personal travel from London Heathrow Airport through “at least” Sept. 11 and had temporarily banned the use of those perks from Amsterdam, through July 31. United Airlines has prohibited the use of buddy passes — deeply discounted flights for friends and family — on trips through London Heathrow through at least the end of August.
United is also telling staff about the challenges with overseas travel this summer and to prioritize customers, a spokesman said.
Those decisions came after Britain’s busiest airport established departing passenger caps in an effort to ease congestion this summer.
Free and deeply discounted tickets are a selling point for airlines as they seek to staff up to meet a jump in bookings. But carriers also want to fill as many seats as possible with paying customers. Using those staff travel perks as a so-called nonrev or nonrevenue passenger means flying standby, compared with the confirmed space of a paying traveler.

While getting a free or discounted seat is often a gamble during peak periods, this summer is proving especially tough for airline staff dreaming of a cheap European vacation.
“Many European airports are experiencing overcrowding, significant delays and passenger caps, greatly limiting non-rev departure availability,” American Airlines said in a message to staff on Aug. 5. 
The message said that only “a handful” of travelers trying to use buddy passes recently for flights back to the U.S. were accommodated, and that those trying to use the passes would likely be stuck in Europe for an extended period.
Strains at some European airports could persist after the peak summer travel season. Earlier this month Amsterdam Schiphol said it would cap passenger departures into October.
“The purpose of setting a maximum is to ensure the safety of passengers and employees and to create a reliable process at the airport,” the airport said in a statement.
The issues aren’t just limited to Europe. JetBlue Airways paused standby pass travel, including for staff, between New York’s John F. Kennedy International Airport and Guayaquil’s Jose Joaquin De Olmedo Airport due to “heavy flight and bag loads” into the Ecuadorian airport, according to an employee note seen by CNBC.
Correction: American Airlines has barred staff from only using their flight benefits for personal travel from London Heathrow Airport through “at least” Sept. 11. An earlier version misstated the terms of the pause.

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Best Buy is cutting jobs across the country after warnings of slower sales and cutting its forecast.
The layoffs come even as the U.S. job market remains strong.
Other pandemic beneficiaries, including Walmart and Shopify, have also laid off some workers as they adjust to changes in consumer spending.

Black Friday shoppers leave a Best Buy store in Washington, DC, on November 26, 20221.
Nicholas Kamm | AFP | Getty Images

Best Buy said on Friday that it is cutting jobs across the country about two weeks after it warned it was seeing weaker sales than expected.
A Best Buy spokeswoman, Carly Charlson, declined to say how many people were affected by the layoffs.

“We’re always evaluating and evolving our teams to make sure we’re serving our customers,” Charlson said. “With an ever-changing macroeconomic environment, including customers shopping more digitally than ever, we have made adjustments to our teams that include eliminating a small number of roles.”
The company is still investing in other parts of its business, including health care and home services, as well as filling positions as it gears up for the holiday season. Charlson said the company has more open roles than the number of employees affected by the cuts.
The news was first reported by the Wall Street Journal. It said the retailer has eliminated hundreds of store jobs over the past week, citing people familiar with the matter.
Best Buy had about 105,000 employees in the U.S. and Canada, as of the end of January, compared with the nearly 125,000 employees it had at the same time in 2020, according to financial filings. The company is laying off workers even as the U.S. jobs market remains strong. The unemployment rate fell to 3.5% in July, according to the Bureau of Labor Statistics, and hiring exceeded expectations with nonfarm payrolls rising by 528,000 for the month.
Yet some retailers, which saw significant sales growth during the pandemic, are feeling the whiplash of sharp changes in consumer behavior.

Best Buy already anticipated slower sales after seeing a boom in demand for home theaters, office equipment, kitchen appliances and benefitting from stimulus dollars. Yet in late July, it cut its sales forecast for the second quarter and full year, saying consumers are skipping over big-ticket items as they get hit by inflation.
Walmart, Shopify and Peloton are also laying off workers as sales demand slows. Walmart cut about 200 corporate employees, according to people familiar with the matter. Shopify laid off roughly 1,000 workers. And Peloton said Friday that it is slashing about 780 jobs.
Amazon’s workforce has gotten smaller, too, primarily through attrition. The company’s headcount shrank by 99,000 people to 1.52 million employees at the end of the second quarter after almost doubling in size during the pandemic.
Best Buy will report its fiscal second-quarter earnings on Aug. 30.

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With a recent influx of money pouring into high-yield bonds, financial experts urge caution before piling in.
High-yield bonds typically have greater default risk than investment-grade bonds because issuers may be less likely to cover interest payments and loans by the maturity date.

Source: Getty Images

Investors have been pouring money into high-yield bonds, which typically pay more interest for taking on greater risk. But these investments are also known as “junk bonds,” and financial experts urge caution before piling in.
After a rocky start to 2022, U.S. high-yield bond funds received an estimated $6.8 billion in net money in July, according to data from Morningstar Direct.

While yields have recently dipped to 7.29% as of Aug. 10, interest is still higher than the 4.42% received in early January, according to the ICE Bank of America U.S. High-Yield Index.

However, junk bonds typically have greater default risk than their investment-grade counterparts because issuers may be less likely to cover interest payments and loans by the maturity date.
“It’s a shiny metal on the ground, but all shiny metals are not gold,” said certified financial planner Charles Sachs, chief investment officer at Kaufman Rossin Wealth in Miami.
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While some say default risk is built into junk bonds’ higher yields, Sach warns these assets may act more like stocks on the downside. 

If an investor feels strongly about buying high-yield bonds, he may suggest a smaller allocation — 3% to 5%, for example. “Don’t think of it as a major food group within your portfolio,” he added.

Rising interest rates may be risky for high-yield bonds

Since March, the Federal Reserve has taken aggressive action to fight inflation, including the second consecutive 0.75 percentage point interest rate hike in July. And these rate hikes may continue with annual inflation still at 8.5%.  
At the margin, rising interest rates may make it more difficult for some bond issuers to cover their debt, especially those with maturing bonds that need to refinance, said Matthew Gelfand, a CFP and executive director of Tricolor Capital Advisors in Bethesda, Maryland.
“I think that investors and lenders will demand somewhat higher rates as a result,” he said, noting that rising interest rates may continue for a while.

Coupon rate ‘spread’ is slightly smaller than usual

When assessing high-yield bonds, advisors may compare the “spread” in coupon rates between a junk bond and a less risky asset, such as U.S. Treasurys. Generally, the wider the spread, the more attractive high-yield bonds become.
With high-yield bonds paying 7.29% as of Aug. 10, an investor may receive $72.90 per year on a $1,000 face value bond, whereas the 7-year Treasury, offering about 2.86%, provides $28.60 annually for the same $1,000 bond.

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In this example, the yield spread is roughly 4.43 percentage points, offering a so-called income premium of $44.30, which is $72.90 from the high-yield bond minus $28.60 from the Treasury.
Over the past 40 years, the average spread between these assets has been about 4.8 percentage points, according to Gelfand, making the slightly narrower spread less attractive.
However, “there are a lot of moving parts in the high-yield bond market,” he added.

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The almost 20 listed clients once represented by Biden aide Anita Dunn include AT&T, Micron, American Clean Power Association, Lyft, Pivotal Ventures, Pfizer, Salesforce and Reddit.
The disclosure also shows dozens of stock holdings owned by Dunn, including previous call and put options tied to the S&P 500, corporate and municipal bonds and a plethora of individual stocks within numerous brokerage accounts.
Dunn returned to the White House as an assistant and senior advisor to the president in May.

Anita Dunn (L), senior advisor to President Joe Biden, and White House Deputy Director of Legislative Affairs Reema Dodin arrive for a lunch meeting with Senate Democrats at the U.S. Capitol on July 22, 2021 in Washington, DC.
Chip Somodevilla | Getty Images

White House senior advisor Anita Dunn is being forced to divest an investment portfolio worth an estimated $16.8 million to $48.2 million that ethics attorneys say poses significant conflicts of interest in her new role.
The political and communication’s strategist will also have to recuse herself from a myriad of domestic and international issues that affect her former clients.

Dunn’s newly released financial disclosures, which are 93 pages long, show extensive stock, options, bond and private equity holdings — a fortune she and her husband, veteran attorney Bob Bauer, have amassed over the years. Bauer is a high-powered lawyer who served in the White House under the Obama administration; Dunn is a founding member of the consulting firm SKDK where she was paid $738,715 over the last 2 1/2 or so years, according to the White House. The disclosure form also provides insight into her extensive client list at SKDK.
White House spokesman Chris Meagher told CNBC in an email Thursday that Dunn will need to divest her holdings and is recused from all matters involving SKDK and her past clients. She also won’t be able to attend any meetings involving them for two years, pursuant to the Biden-Harris ethics pledge, he said. The form discloses transactions over the two calendar years preceding her May 9 appointment, Meagher added.
“The ethics rules require White House officials to recuse from matters that conflict with their financial interests. When officials have a large scope of duties and an even larger stock portfolio, sunlight is the best disinfectant,” Kedric Payne, the vice president and general counsel of the watchdog Campaign Legal Center, said after reviewing her disclosure.
Dunn worked for the president as one of his senior advisors from January 2021 through that August before returning for a brief stint this March. She was considered a special government employee for both posts who was exempt from disclosing her assets publicly. She wasn’t required to file a public disclosure form until her most recent appointment in May.
She returned as President Joe Biden’s public poll numbers were in flux and the administration was struggling with a panoply of vexing global and domestic crises, including Russia’s invasion of Ukraine, the supply chip shortage, rising gas prices and sky-rocketing inflation. Biden also announced he was nominating Judge Ketanji Brown Jackson to the Supreme Court in late February.

The disclosure also shows dozens of stock holdings acquired by Dunn and her husband, including call and put options tied to the S&P 500, corporate and municipal bonds and a plethora of individual stocks held in numerous brokerage accounts. Those brokerage accounts show investments into corporate giants such as Amazon, Alphabet, Boeing, Bank of America, Chevron, Dow, KKR and Morgan Stanley. The couple’s portfolio is diverse and includes at least $500,000 tied up in a hedge fund.
Ethics requirements for White House officials and lawmakers don’t require precise values, relying instead on a fairly wide range. Based on her disclosure form, H. Jude Boudreaux, a senior financial planner at The Planning Center, estimated her and her husband’s holdings to be worth between $16.8 million and $48.2 million. Lee Baker, a certified financial planner at Apex Financial Services, estimated Dunn and her spouse to have a net worth between $18 million and $38 million in assets. Their properties aren’t listed on the form or included in calculating their net worth.
The couple held between $1,000 and $15,000 in corporate bonds issued by Lockheed Martin, Phillip Morris, Target, Bank of America, Apple and Boeing, among others — all companies that have frequent and multiple issues requiring federal oversight. The pair held between $15,001 and $50,000 in debt issued by numerous other corporations, including Cisco Systems, Oracle Corp., Wells Fargo, Duke Energy, Visa Inc. and Amazon. They also have numerous accounts or mutual fund holdings that are valued at more than $500,000, apiece. Dunn additionally held between $1 million and $5 million of stock in marketing firm Stagwell, which she received after it acquired SKDK in 2015.
They also made tens of thousands of dollars exercising put options in the iShares Core S&P 500 Index, which could create conflicts of interest with “every single company” in the S&P 500, according to Walter Shaub, who used to run the Office of Government Ethics under the Obama administration and briefly served in the Trump administration.
“Options are not exempt from the conflict of interest statute under any circumstance. That means that she came into government with a conflict of interest with every company whose stock she wrote an option for and with every company in the referenced indexes,” Shaub said after reviewing Dunn’s financial disclosure. He said she needs to divest all of the options or recuse herself for every issue “affecting any company in the S&P 500 and any other company whose stock is the subject of an option she held.”
The power couple also held numerous municipal bonds that were used for state and local infrastructure and school projects across America, including in Burlington County, New Jersey; Clark County, Nevada; the Klein County Independent School District in Texas and Miami Dade County, Florida, to name a few. The Biden administration has been doling out hundreds of billions, if not trillions, of dollars to local, city and state agencies and schools to upgrade transportation infrastructure, high-speed internet access and invest in other public works projects.
SKDK is within the top 25 paid Democratic political vendors in the country, according to non-partisan campaign finance watchdog OpenSecrets. Data shows that during the 2020 election cycle, SKDK was paid over $65 million by Democratic aligned campaigns. Biden’s campaign paid over $2 million for SKDK’s services last cycle, according to OpenSecrets datat.
In an interview with MSNBC’s Morning Joe on Thursday, she previewed the president’s upcoming agenda as the White House reaps victories in getting the Inflation Reduction Act through Congress and the CHIPS and Science Act signed into law.
“So, addressing the continued opioid crisis that we have in this country is one of those things that he believes we should work together on and that we can work together on,” Dunn said in the Thursday interview on MSNBC. “Cancer, and ending cancer as we know it. Again, something very bipartisan that he believes everyone should work on together and that he will continue to push. And he will also continue to work towards an economy that really does work for the working people in this country.”
Micron, one of Dunn’s former clients, announced shortly after the CHIPS bill was signed that they will invest $40 billion between now and 2030 to manufacture chips in the U.S. Meagher noted that Dunn didn’t have anything to do with their announcement earlier this week and stopped working for Micron before she rejoined the White House.
Other clients include AT&T, American Clean Power Association, Lyft, Pivotal Ventures, Pfizer, Salesforce and Reddit.
Pivotal Ventures is an investment office founded by Melinda French Gates, who divorced billionaire Bill Gates last year. French Gates has repeatedly visited the Biden led White House, including as recently as April, according to White House visitor logs. Meagher said that the French Gates meetings weren’t organized by Dunn but noted that her prior work for Pivotal was focused on issues related to paid family leave.
Salesforce hasn’t been a client of Dunn’s since 2020 and it was for a media training project, Meagher explained. Salesforce CEO Marc Benioff and his family privately met with Biden in mid-March, according to the visitor logs. Meagher did not respond when asked if Dunn helped set up that meeting, and Salesforce didn’t return a request for comment.
Most of the other clients mentioned in this story didn’t return requests for comment. A spokeswoman for Reddit declined to comment.
Alexander Byers, a spokesman for AT&T, told CNBC that SKDK “has provided us with strategic communications advice for more than a decade,” but Dunn wasn’t the account lead. She provided periodic advice, he said.

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Shares of GlaxoSmithKline, Sanofi and Haleon all sold off sharply this week amid investor fear over potential U.S. litigation charges focused on popular heartburn drug Zantac.
This has been a known issue bumbling in the background for years but investor concern exploded this week in the lead-up to the first scheduled legal proceeding.
For many investors and analysts, this ordeal brings back memories of the Bayer Roundup saga.

Shares of GlaxoSmithKline, Sanofi and Haleon all sold off sharply this week, shedding tens of billions in market value, amid investor fear over potential U.S. litigation charges focused on popular heartburn drug Zantac.
This has been a known issue bubbling in the background for years but investor concern exploded this week in the lead-up to the first scheduled legal proceeding on Aug 22.

What is Zantac?

Zantac is the brand name for a drug called ranitidine, a medicine used to relieve heartburn. It was originally invented and sold by Glaxo as a prescription drug in the 1980s before transitioning to an over-the-counter medicine.
In 2019, regulators launched a safety review amid concern the drug contains a probable carcinogen called NDMA, prompting manufacturers to pull it from shelves. And by 2020, the U.S. FDA and the European Medicines Agency requested all versions of the treatment be withdrawn from the market.
Since then, more than 2,000 cases have been filed in the U.S. with plaintiffs contending that consuming Zantac can generate NDMA.
The first trial begins Aug. 22 with key bellwether trials to begin in early 2023.

Packages of Zantac, a popular medication which decreases stomach acid production and prevents heartburn, sit on a shelf at a drugstore in New York City.
Drew Angerer | Getty Images

The litigation is particularly complicated because so many pharma players have been involved with the drug.

The patent for the drug expired in 1997, so there are multiple manufacturers, retailers and distributors of the medicine named as defendants in the lawsuits.
There have been multiple owners of the OTC rights in the U.S. since 1998, including GSK, Sanofi, Pfizer and Boehringer Ingelheim.
Haleon, the consumer health business spun off from GlaxoSmithKline last month, is not primarily liable for the claims, according to the company, but may be tangentially linked.

Company responses

In response to the violent share price moves this week, GlaxoSmithKline, Sanofi and Haleon have all issued statements defending themselves.
The drugmakers’ stock prices stabilized on Friday morning.
A GlaxoSmithKline spokesperson said, “The overwhelming weight of the scientific evidence supports the conclusion that there is no increased cancer risk associated with the use [of] ranitidine … Suggestions to the contrary are therefore inconsistent with the science and GSK will vigorously defend itself against all meritless claims.”
A Sanofi spokesperson said, “There is no reliable evidence that Zantac causes any of the alleged injuries under real-world conditions, and Sanofi remains fully confident in its defenses. Given the strength of our case and the uncertainty of future proceedings no contingencies have been established.”

Zantac is the brand name for a drug called ranitidine, a medicine used to relieve heartburn.
The Washington Post | The Washington Post | Getty Images

Haleon’s involvement and potential liability appear less clear-cut.
Haleon asserts that it is not a party to any of the Zantac claims, saying it “never marketed Zantac in any form in the U.S.” and is “not primarily liable for any OTC or prescription claims.”
However, as flagged in the prospectus issued on June 1, “to the extent GSK and/or Pfizer are held liable in respect of OTC Zantac, Haleon may be required to indemnify GSK and/or Pfizer” under certain conditions.

What are the analysts saying?

“As with all legal outcomes, there are considerable uncertainties,” Credit Suisse’s European pharma team said in a note. “That is particularly true in this case where four companies have been involved in the ownership of Zantac rights over time”.
As the brand originator, GSK could be on the hook for the bulk of the liabilities, rather than the OTC manufacturers, according to the team.
Redburn said in a research note that given there are multiple manufacturers of the drug as well as retailers and distributors named as defendants, this potentially reduces the absolute impact at the company level.

Deutsche Bank Research pharmaceuticals team on Thursday upgraded its recommendation on Sanofi from “Hold” to “Buy” on the basis that “the Zantac knee-jerk is starting to look somewhat overdone.”
The German bank does not think it is an obvious buying opportunity but argues that “maintaining a Sell at these levels feels egregious.”
The team adds, “Both GSK/SAN now appear to present a classic conundrum: ensnared by anxiety over an impending liability overhang they cannot yet fully assess.”

How big could the settlements be?

Credit Suisse says this depends on the strength that the court sees from any link between NMDA and cancer and any evidence of wrongdoing.
Previous drug settlements have ranged from $30,000 to $270,000 per claimant based on evidence of wrongdoing.
There are currently more than 2,000 known claimants but this is expected to increase as the trials proceed.

Comparison to Bayer, Monsanto

For many investors and analysts, this ordeal brings back memories of the Bayer Roundup saga.
Shortly after Bayer took over Monsanto in 2018, Roundup-related lawsuits quickly swelled, ultimately costing Bayer billions of dollars and years of legal and financial uncertainty.
Like in the case of Bayer’s acquisition of Monsanto where the litigation risk was flagged to investors before the deal was completed, GSK flagged the Zantac litigation as a key risk for Haleon in the prospectus issued to investors in June.

In the nearly 500-page document, GSK warned, “The Group has indemnification obligations in favour of the GSK Group and the Pfizer Group, which could be significant and have a material adverse effect” on the group’s finances.
In contrast to Bayer’s Roundup, Zantac has been withdrawn by regulators worldwide. Further, there are currently over 2k claims related to Zantac and other ranitidine products compared to Bayer who faced 130k glyphosate-related cases.
“We don’t think the evidence points to this as another glyphosate, but it is very possible we may see a liability of some $bn magnitude,” writes Deutsche Bank.

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As Donald Trump considers whether to make a third run for the White House, the former president faces a raft of official investigations and civil lawsuits.
The investigations are focused on efforts to overturn Trump’s 2020 election loss to President Joe Biden, the removal of White House records to Trump’s residence at Mar-a-Lago and the Jan. 6 Capitol riot.
The FBI raided Mar-a-Lago this week and removed about a dozen boxes, a lawyer for Trump said.

Former US President Donald Trump raises his fist while walking to a vehicle outside of Trump Tower in New York City on August 10, 2022.
Stringer | AFP | Getty Images

As Donald Trump considers whether to make a third run for the White House — and when to announce that decision — the former president faces a raft of official investigations and civil lawsuits.
Several of those probes put Trump at risk of criminal sanctions. Others threaten his pocketbook.

What also remains to be seen is whether they will hurt or help Trump, in what many supporters expect and hope will be his candidacy in 2024.
The Republican Trump has repeatedly called the legal probes “witch hunts” by Democratic officials and allies that are designed to hobble him politically. He has denied any wrongdoing.
Here are the top legal challenges for Trump at the moment.

Federal criminal investigation into White House records removal

The records probe on Monday vaulted to being potentially the biggest legal threat to Trump, after his stunning revelation that a team of FBI agents was raiding his residence at the Mar-a-Lago club in Palm Beach, Florida.
The raid was connected to a federal grand jury in Washington, D.C., which is investigating Trump over the removal of records from the White House when he left office in January 2021.

The National Archives and Records Administration in January 2022 retrieved 15 boxes of White House records from Mar-a-Lago. That government agency said the documents should have been sent to NARA at the end of Trump’s administration.
A month later, the National Archives revealed it had found documents marked as being “classified national security information” in the boxes. The Justice Department in May issued a subpoena for those documents to the National Archives.
On Monday, FBI agents carrying a search warrant went to Mar-a-Lago and seized about a dozen boxes from the residence, according to an attorney for Trump, who was staying in the New York area at the time. That lawyer, Christina Bobb, said agents were investigating possible violations of laws related to the Presidential Records Act and the handling of classified material.
The Justice Department on Thursday filed a motion to unseal the search warrant that the FBI used to raid Trump’s home.
To obtain such a warrant, the FBI has to show a judge that there is probable cause that a crime has been committed and that the evidence they are searching for relates to that potential crime.
“Monday’s unprecedented and absolutely unnecessary raid of President Trump’s home was only the latest and most egregious action of hostility by the Biden Administration, whose Justice Department has been weaponized to harass President Trump, his supporters, and staff,” Trump’s spokesperson told NBC News on Thursday. 

Georgia criminal investigation of Trump for interference in state’s 2020 presidential election

Fulton County District Attorney Fani Willis’ office is presenting evidence and testimony to a special grand jury in Atlanta impaneled to investigate Trump and a number of his allies in connection with their attempts to get officials in Georgia to undo President Joe Biden’s election win there.
Before Monday’s Mar-a-Lago raid by the FBI, some legal observers considered the Fulton County probe to be the most pressing threat of criminal prosecution to Trump. It still may be.
Willis, a Democrat, in particular is eyeing a Jan. 2, 2021, call Trump placed to Georgia Secretary of State Brad Raffensperger. During that conversation, the then-president asked Raffensperger to “find” Trump more than 11,700 votes to reverse his margin of defeat by Biden.
The DA also is investigating contacts Trump allies had with the state’s attorney general, and the top federal prosecutor for the Northern District of Georgia.
Willis last month had the grand jury issue subpoenas to lawyers on the Trump campaign legal team, among them former New York City Mayor Rudy Giuliani, as well as to U.S. Sen. Lindsey Graham, R-S.C., and a dozen so-called fake electors for Trump in Georgia.
Those electors were assembled with the goal of setting up a legal dispute in which Trump’s slate would challenge the legitimacy of the Electoral College delegates awarded Biden for his popular vote win in Georgia.

Federal criminal investigation into the Jan. 6, 2021, Capitol riot

Another grand jury in Washington is collecting evidence and testimony related to Trump’s actions leading up to the insurrection at the Capitol by a mob of his supporters, who swarmed through the halls of Congress, disrupting the confirmation of Biden’s election.

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Trump, who for weeks before the riot falsely claimed that widespread ballot fraud was responsible for his loss in the election, is not personally under criminal investigation in this case, NBC News reported last week, citing a federal official.
But the grand jury has subpoenaed Trump’s former White House counsel Pat Cipollone to testify in the probe, along with two top aides to former Vice President Mike Pence.

Select House Committee investigating Jan. 6 riot

The House panel, which has interviewed more than 1,000 people in connection with its probe into the riot, has begun holding a series of public hearings that have laid out Trump’s actions leading up to and during the attack on the Capitol.
Witnesses have testified that Trump, after holding a rally for supporters outside the White House early that day, wanted to join the crowd outside the Capitol as they protested Biden’s election.
After being rebuffed in that attempt, Trump then spent hours watching the attack on Congress unfold on television without taking steps to call off the mob, witnesses said.
“Donald Trump’s conduct on Jan. 6 … is a stain on our history,” Rep. Adam Kinzinger, R-Ill. said during the panel’s July 22 hearing.
The committee cannot bring criminal or civil charges against Trump but is expected to present its findings in a damning final report.

Federal criminal investigation into efforts to overturn the 2020 presidential election

Trump and his allies, including a team of lawyers led by Giuliani, engaged in a wide-ranging effort to reverse Trump’s losses to Biden in seven swing states.
The Justice Department is eyeing those efforts, which included a campaign to pressure Pence to refuse to certify Biden’s win at a joint session of Congress on Jan. 6. Pence did not go along with that plan, and certified Biden’s victory in the Electoral College, guaranteeing that he would become president.
Federal agents have seized phones from three men who had discussions with Trump at the time they were involved in the effort to undo Biden’s victory.
Rep. Scott Perry, R-Pa., had his phone taken this week. The lawyer John Eastman, who was one of the leading architects of a plan to submit slates of fake electors for Trump, previously had his phone seized, as did former Justice Department official Jeffrey Clark.
Trump had sought to make Clark the attorney general of the United States, where he would have been in a position to get the Justice Department to back Trump in the election reversal effort.
Eric Holder, who served as attorney general in the Obama administration, during a radio interview last week said Trump “probably” will be indicted on criminal charges with officials from his White House in connection with that effort.
“But I think before that, I expect something coming of that prosecutor in Atlanta,” Holder said, referring to the Georgia state election interference probe being conducted by DA Willis.

New York Attorney General Office civil investigation of Trump Organization business practices

Trump on Wednesday appeared for an hours-long deposition at the offices of New York state Attorney General Letitia James, who is eyeing allegations that Trump’s company improperly manipulated the stated valuations of real estate assets to obtain millions of dollars worth of financial benefits.
Trump refused to answer questions under oath by James’ lawyer, invoking his Fifth Amendment right against self-incrimination more than 440 times.
Trump’s son Eric Trump, who runs the Trump Organization with his older brother Donald Trump Jr., in 2020 cited the Fifth Amendment more than 500 times when he refused to answer questions at his own deposition in the probe.
The Democrat James has indicated her probe is focused on claims that Trump properties were tweaked in order to obtain better terms on loans and insurance and to obtain tax breaks. Trump’s former personal lawyer Michael Cohen testified to that practice during an appearance before Congress.
The attorney general at the end of that investigation could seek to impose civil sanctions, including monetary penalties, on the Trump Organization.

Manhattan District Attorney criminal case against Trump Organization

The Trump Organization and its longtime Chief Financial Officer Allen Weisselberg are awaiting trial on criminal charges in a 15-count indictment related to an alleged scheme to avoid taxes on compensation to the CFO and other executives since 2005. The defendants have pleaded not guilty.
Manhattan DA Alvin Bragg also was known to be investigating Trump and his company for possible crimes related to the asset valuation manipulation being eyed in AG James’ civil case.
Earlier this year, two top prosecutors in Bragg’s office handling that probe quit after Bragg declined to file criminal charges against Trump.
“I believe that Donald Trump, in fact, was guilty and, second, that there was sufficient evidence as a matter of law to have sustained a guilty verdict if we went forward,” Mark Pomerantz, the former special prosecutor in Bragg’s office, said last month in a podcast interview.
If Trump “had been Joe Blow from Kokomo, we would have indicted,” Pomerantz said.
Bragg’s office has said the investigation is ongoing.
But there is a widespread belief that the Democratic DA will not seek to indict Trump in the absence of a cooperating witness who could give evidence against him.

Rape defamation lawsuit by the writer E. Jean Carroll

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Retailers rushed to enter the subscription space, curating boxes of clothing and other items. But consumers are showing signs they’re no longer interested.
Trunk Club, which was acquired by Nordstrom for an undisclosed amount in 2014, no longer exists.
Stitch Fix, launched in San Francisco in 2011, is struggling to be profitable.

A selection of men’s clothes packaged by Trunk Club, which was shuttered earlier this year after Nordstrom bought the personal styling service in 2014.
Source: Trunk Club

After earning a master’s degree a decade ago, David Hill wanted to amp up his personal style and signed up for the Trunk Club, which promised to mail him boxes of clothing tailored to his tastes as often as he liked.
Hill would visit the company’s Chicago showroom to meet with a stylist and pick outfits he could wear to the office or for special occasions. The stylist helped him design a custom suit and sent handwritten notes to check how he was liking his clothes, turning Hill into a loyal customer.

Then the Covid-19 pandemic hit.
“At the beginning, they were trying to tell me to buy sweatpants and joggers,” he said.
But Hill, 41, no longer needed new clothes since he was working from home and barely going out, and he canceled his subscription.
Not that long ago, major retailers were scrambling to get in on the subscription craze sweeping the apparel industry. But then the pandemic upended daily routines and made shopping behaviors far less predictable. Now, some analysts and investors are questioning the appeal of these types of businesses and their ability to hold onto customers, who often sign up during a big life change but eventually lose interest.
After acquiring the Trunk Club in 2014, Nordstrom announced in May that it was winding down the business and focusing on its in-house personal styling services. Rockets of Awesome, which curates boxes of clothing for kids, started running low on funding early this year as it hunted for a buyer. Stitch Fix, one of the best-known services in the space, was gaining traction in the years leading up to the pandemic but is now losing money and subscribers.

The subscription business model was appealing to apparel companies because it offered a predictable revenue stream based on regular membership fees. But companies are realizing that squeezing profits out of the playbook is harder than they thought.

Fading interest

Stitch Fix’s struggles to turn a profit during the Covid-19 pandemic underscore how difficult it can be to run a subscription-based business, especially when consumers’ tastes are a moving target.
The company charges a $20 styling fee when a customer starts the styling process with boxes of clothing called “Fixes” that they might like. The money can later be applied toward items customers decide to keep from a box, which can be delivered every couple weeks, every month, every other month or every three months.
Edward Yruma, a managing director and senior research analyst covering the retail industry at Piper Sandler, said people often sign up for subscription services when they’re excited about a big change, such as starting a new job, losing a lot of weight or becoming pregnant. But he said that excitement often fades, making it difficult for companies to hold onto customers.
According to the analytics firm M Science, new customers account for a predominant share of sales at Stitch Fix, but their spending generally drops off over time. Roughly 40% of Stitch Fix’s revenue has been generated by new customers since its fiscal first quarter of 2020, the firm found.
“There definitely seems to be box fatigue,” Yruma said.
Over time, he noted companies are also realizing the drawbacks of the subscription business model, “People return too much stuff with these boxes, and you just can’t drive enough profit from it.”
David Bellinger, an executive director at MKM Partners, said he thinks Stitch Fix’s active client count may have peaked in its August-to-October quarter, when the company reported a record 4.18 million active customers.
“This puts into question the longer-term membership potential,” Bellinger said, noting that inflation and other macroeconomic challenges could bring more cancellations.
In the company’s most recent quarter ended April 30, Stitch Fix said it lost 200,000 active clients, bringing its total count to 3.9 million. Its net loss ballooned to $78 million, from a loss of $18.8 million a year ago. The company announced it was laying off 15% of its salaried workers, or about 330 people.
To attract new customers, Stitch Fix expanded the rollout of its “Freestyle” option last fall that lets shoppers buy single items from its website without signing up for a plan or paying a styling fee. But the company is still trying to ensure people know the option exists.
“We are in the midst of a transformation and we know not every day or every moment will be easy,” Stitch Fix CEO Elizabeth Spaulding, who took the reins from founder Katrina Lake in August 2021, wrote in a memo to employees in June.
A spokeswoman said Stitch Fix avoids describing itself as a subscription company because it allows customers to select the cadence at which they receive boxes of clothing.
In November 2017 when it went public, Stitch Fix fetched a market valuation of more than $1.6 billion. Its market cap is now less than $800 million.
The company’s push to turn a profit comes as consumers say they’re trying to cut back their spending on subscription plans overall, according to a survey by Kearney, a consulting firm.
The firm found earlier this year that 40% of consumers think they have too many subscriptions. People reported spending the most on streaming plans, followed by music and video subscriptions, gaming, food memberships, and beverage boxes. Shopping subscriptions, which includes fashion, came after those categories.

A changing consumer

Sonia Lapinsky, a managing director in the retail practice at AlixPartners, said the subscription business model needs to go through a major reset after the pandemic. Companies also need to get better at keeping up with evolving shopping behaviors, she said.
“Not only are they different than they were pre-pandemic, they’re changing all the time,” she said about consumers.
Tara Novelich, a teacher living in Orange County, California, is among the once-loyal Stitch Fix customers who have since dropped the service. Novelich signed up for the service in 2012 when she felt pressed for time, and said she bought at least one item from her monthly box of “Fixes” for about 18 months.
But then she said the quality of the clothing and service started “going downhill” and that the shipments were too frequent.
“I wasn’t as excited anymore,” said Novelich, now 46.
More recently, she has been enjoying her subscription to FabFitFun, which sends customers a selection of beauty items, jewelry and seasonal accessories. Novelich gets shipments four times a year.
In other cases, subscriptions might feel like too much of a splurge.
A 35-year-old advertising executive who asked that her name not be used to protect her job, became a part-time stylist and customer for Stitch Fix in 2016. But during the pandemic, she stopped working at Stitch Fix to focus on her full-time job and started shopping from Trunk Club, which she said offered better quality. Eventually, that became too expensive.
“I could never afford the the majority of it because it would be $600 to $1,000 every month,” she said.
Now, she works mostly from home and buys the majority of her clothes from Amazon, which offers a “try now, buy later” option. She also recently shopped from Stitch Fix’s “Freestyle” section.
Hill, the marketing executive who now lives in New Jersey, hasn’t returned to shopping via a subscription plan and instead picks out his own clothes at a nearby Nordstrom. He recalled the days when he would visit one of Trunk Club’s physical locations, and a time when he and his wife were greeted with champagne.
“Obviously, that model wasn’t that sustainable,” Hill said.

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The chief financial officer of German energy firm RWE said it will burn more coal in the short term — but insists its plans to be carbon neutral in the future remain in place.
Greenpeace has described coal as “the dirtiest, most polluting way of producing energy.”
“To be very clear, it doesn’t change our strategy,” Michael Muller told CNBC of its carbon neutral plans.

An excavator photographed at a lignite mine operated by RWE on April 8, 2022. RWE says it wants to be carbon neutral by 2040.
Alex Kraus | Bloomberg | Getty Images

The chief financial officer of German energy firm RWE told CNBC Thursday that it will burn more coal in the short term — but insists its plans to be carbon neutral in the future remain in place.
Michael Muller’s comments come as European countries scramble to shore up energy supplies, as the war in Ukraine continues.

Russia was the biggest supplier of both petroleum oils and natural gas to the EU last year, according to Eurostat. It has significantly reduced flows of natural gas to Europe after Western nations imposed sanctions on the Kremlin as a result of its unprovoked invasion of Ukraine.
Germany — Europe’s largest economy — has decided to recommission some of its coal-fired power plants in order to compensate for its lack of Russian gas.
“RWE is actively supporting the German government, or European governments, in managing the energy crisis,” Muller told CNBC’s Joumanna Bercetche. “So we’re also bringing back additional coal capacity to manage that situation.”
This plan will involve three of RWE’s lignite-fired power stations being brought back to the grid from the start of October.

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RWE says lignite, also known as brown coal and considered particularly bad for the environment, “remains a reliable partner to this day.” It adds that RWE Power — which focuses on lignite and nuclear power generation — extracts millions of metric tons of coal each year.

All of the above represents a hurdle for the Essen-headquartered business, which has said it wants to be carbon-neutral by the year 2040.
A fossil fuel, coal has a substantial effect on the environment and Greenpeace has described it as “the dirtiest, most polluting way of producing energy.” Coal combustion produces a slew of potentially dangerous emissions, including carbon dioxide, sulfur dioxide, particulates and nitrogen oxides.
“What is currently happening is … hopefully a short term issue where we need to find the security of supply,” RWE’s Müller said.
“And that’s why, just from a corporate citizen’s perspective, we feel it is our duty to support the German government in bringing back capacity in the short term — but to be very clear, it doesn’t change our strategy,” he added.
“So while [in the] short term we have to burn additional coal, it needs to be clear that there needs to be an acceleration of building out renewables so that we still meet … targets in the medium and long-term.”

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On Thursday, RWE reported earnings for the first half of 2022, with adjusted net income coming in at 1.6 billion euros (around $1.66 billion), compared to 870 million euros in the first half of 2021.
The company said it had invested approximately 2 billion euros in expanding its green portfolio in the first half of 2022. “Total investments will come to more than 5 billion [euros] by the end of 2022,” it added.
Electricity generation from renewables was around 20% higher in this period compared to the first half of 2021, it said, citing improved wind conditions and increased capacity. More