Economy

BOSTON (Reuters) – The wife of Edward C. Johnson IV, whose family controls mutual fund powerhouse Fidelity Investments, has hired celebrity lawyer David Boies to represent her in a high-stakes divorce trial that opens on Friday.Boies, 81, is the founder of law firm Boies Schiller Flexner LLP and represented Al Gore in the U.S. Supreme Court case over the 2000 presidential election recount. He told Reuters he will represent Allison Johnson in the divorce trial.Judge Frances Giordano is presiding over the Johnson divorce, Boies said.Johnson IV, whose personal fortune is estimated by Bloomberg at more than $6 billion, is expected to appear for opening statements inside a Lawrence, Massachusetts, courtroom for family and probate cases on Friday.”It’s expected those (opening) statements will lay out the case in some detail,” Boies said in a telephone interview. “It’s a divorce case so it covers the basic issues of family law, including economic ones.”Boies declined to provide any claims or details in the case, which has been impounded, a court order that shields it from public view. Johnson IV and members of his legal team did not return messages seeking comment.The divorce petition was filed more than a year ago but had not become public thus far. Johnson IV is a director of FMR LLC, the parent company of Boston-based Fidelity. He is the youngest child of longtime Fidelity leader Edward “Ned” Johnson III, who died in March at age 91. Johnson IV’s sister, Abigail Johnson, is Fidelity’s chairman and chief executive.As a director of FMR LLC, Johnson IV helps guide a family-controlled empire that generated $24 billion in revenue in 2021 and an operating profit of $8.1 billion. The fortunes of his two sisters, Abigail and Elizabeth, are estimated at $21 billion and $6.5 billion, respectively. Boies is well-known for representing the U.S. government in litigation against Microsoft Corp (NASDAQ:MSFT) and for representing former Hollywood producer Harvey Weinstein, who was later convicted of sexual assault. More

President Biden, Vice President Kamala Harris and Labor Secretary Martin J. Walsh met Thursday at the White House with several union organizers involved in successful campaigns at companies including Amazon and Starbucks.The meeting was intended to discuss how the recent organizing successes can inspire other workers to join or form a union, according to the White House.Alex Speidel, an employee and union leader at Paizo, a publisher of role-playing games in the Seattle area, said the administration officials “were interested in hearing about how we had been successful — what things we had done to motivate people without the union history in their families, first-time union joiners.”A high-profile White House event focused primarily on rank-and-file union members and grassroots organizers is unusual for a president of either party. But a task force on worker organizing led by Ms. Harris, which officially organized Thursday’s meeting, has met with workers outside the White House on several occasions, and rank-and-file union members have attended White House events under Mr. Biden. There have also been White House meetings with labor leaders and senior labor officials.Christian Smalls, president of the Amazon Labor Union, asked Mr. Biden to press Amazon’s leadership to recognize the union and to begin collective bargaining, and Mr. Biden expressed general support in response, according to Mr. Speidel and another attendee, Jaimie Caldwell, a librarian at the Baltimore County Public Library in Maryland. A White House spokeswoman said it was up to the National Labor Relations Board, an independent agency, to certify unions. She also pointed to earlier remarks by Jen Psaki, the White House press secretary, noting that President Biden is a longtime advocate “for collective bargaining, for the rights of workers to organize, and their decision to do exactly that” in the case of Amazon.The meeting comes at a time when union organizers have won several high-profile elections, including more than 50 at Starbucks locations and at the Staten Island warehouse where Mr. Smalls led a unionization effort.In addition to union leaders and workers from Amazon, Starbucks, Paizo and the Baltimore County Public Library, the meeting included workers from the outdoor apparel retailer REI and the animation production company Titmouse.Labor leaders often describe Mr. Biden as the most pro-labor president of their lifetimes, pointing to his replacement of government officials they disliked with those more sympathetic to unions, and to the undoing of Trump-era rules that weakened worker protections.During a high-profile union campaign at Amazon last year, Mr. Biden warned that “there should be no intimidation, no coercion, no threats, no anti-union propaganda,” and he later criticized Kellogg for its plans to permanently replace striking workers during a labor dispute. Both were unusual interjections by a sitting president. More

(Reuters) – The U.S. District Court for the Southern District of New York ordered the co-founders of cryptocurrency platform BitMEX to pay a combined $30 million fine in connection with a 2020 complaint from the Commodity Futures Trading Commission. The CFTC alleged that Arthur Hayes, Benjamin Delo and Samuel Reed were illegally operating BitMEX in the U.S. while conducting a significant portion of the company’s business overseas. The CFTC entered into a consent order with BitMEX in August 2021 and fined the firm $100 million. More

How well did you keep up with the news this week? Take our quiz. Wall Street stocks suffered steep declines yesterday in an abrupt reversal from a rally in the previous trading session, with the Nasdaq registering its biggest fall since 2020. The Nasdaq Composite, which comprises many of the largest US technology companies, fell nearly 5 per cent in early afternoon trading in New York, the heaviest intraday drop since September 2020.The blue-chip S&P 500 index also suffered a sell-off, sliding 3.4 per cent. Every large sector was in the red, with industries including consumer discretionary and technology companies among the biggest fallers. Shares of some of corporate America’s biggest names lurched lower, with Amazon down 7 per cent, Tesla sinking 8 per cent and Apple dipping 5 per cent.The Federal Reserve, the world’s most influential central bank, raised its main interest rate by 0.5 percentage points on Wednesday, the biggest increase since 2000, as it attempts to tame intense inflation. Jay Powell, the Fed chief, sent a strong signal that the US central bank is likely to raise rates by the same amount at its next two meetings.Powell’s remarks were at first perceived as dovish, especially after he appeared to take the possibility of a 0.75 percentage point rise off the table for this year. Stocks subsequently rose on Wednesday, with the S&P recording its best day since May 2020.“You’ve got more tightening along the road, so there’s no reason to buy the dip in equities. There’s also no reason to buy bonds at this level because it doesn’t look like inflation is going anywhere,” said Tom di Galoma, managing director at Seaport Global Holdings.Thanks for reading FirstFT Asia. Here’s the rest of the day’s news. — Sophia Five more stories in the news1. Ellison, Binance and Sequoia back Musk’s $44bn bid for Twitter Elon Musk has raised $7.14bn of funding for his $44bn buyout of Twitter, from investors including Oracle co-founder Larry Ellison, crypto exchange Binance and asset management groups Fidelity, Brookfield and Sequoia Capital. Binance chief executive Changpeng Zhao said his crypto exchange would offer “blank cheque” support for Musk’s takeover of Twitter.2. Exclusive: Archegos considered becoming biggest Deutsche Bank shareholder Archegos Capital Management considered becoming the largest shareholder in Germany’s biggest lender before the family office run by co-founder Bill Hwang imploded in 2021. According to two people familiar with the matter, Archegos received information about a controlling stake owned by Chinese conglomerate HNA that was in trouble and later collapsed.3. Covid lockdowns hammer China’s services sector More signs of economic slowdown in China yesterday. An index that measures activity in China’s services sector suffered its second-biggest fall on record as President Xi Jinping’s zero-Covid policy curtails economic activity.4. Russian forces usurp Ukrainian internet infrastructure In a renewed offensive on the southern Donbas region, a fibre optic cable in the city of Kherson was taken offline and rerouted to Russia-controlled operators, making Ukrainians’ data vulnerable to interception and censorship by the Kremlin.5. Hikvision shares plunge after US threatens sanctions The Chinese surveillance camera maker’s share price fell 10 per cent yesterday after the Biden administration began laying groundwork to impose hard-hitting sanctions on the company. Washington has accused Hikvision, which is the world’s largest manufacturer of surveillance equipment, of facilitating human rights abuses.The days aheadQuarterly results A batch of quarterly earnings statements are released today, from Adidas, Beazley, International Airlines Group and ING.Miami Grand Prix The 2022 Formula One season continues with the Miami Grand Prix in the United States on Sunday.Victory in Europe Day Sunday marks the 77th anniversary of the end of hostilities in Europe in the second world war.Mother’s Day Many countries worldwide celebrate Mother’s Day on Sunday.Less than 48 hours until you can hear Henry Kissinger, Chimamanda Ngozi Adichie and more at our inaugural US FTWeekend Festival, this Saturday in Washington DC. We look forward to exploring the global perspective on the ideas and issues of the day, with an array of thinkers, writers, artists, chefs, performers and more. As a newsletter subscriber claim an exclusive limited time offer of 50% off your pass using promo code FTNewslettersxFTWF22.What else we’re reading Russian economy could weather the impact of an EU oil ban Brussels proposed a measure on Wednesday that would ban all imports of Russian oil by the end of the year. The plan carries political heft, but some analysts believe it will not deliver the intended blow to Russia’s economy. Prices for crude have risen substantially, counteracting the costs of losing the European market.How Rivian’s CEO became the anti-Elon The electric truckmaker’s RJ Scaringe has no interest in Mars, or rockets, or building tunnels, or Twitter, either to use or to own. The tall and athletic 39-year-old has shied away from using the Elon Musk playbook in his battle with Ford and Tesla. The man who would replace Erdoğan If there were any doubts about Kemal Kılıçdaroğlu’s determination to take on Turkey’s president, Recep Tayyip Erdoğan, they were dispelled last week. With a critical election due within the next 13 months, he warned unnamed rivals within his opposition alliance: “Either join me or get out of my way.”No let-up in North Korea’s two-year Covid lockout Kim Jong Un reacted decisively to the emergence of coronavirus in early 2020, sealing borders with China and Russia, tightening restrictions on internal movement and ejecting foreign diplomats and aid workers. And while Pyongyang’s claims that it has not recorded a single Covid case have been widely ridiculed, experts say no evidence has emerged of any large-scale outbreaks.More Covid-19 news: The World Health Organization estimates that 15mn people died by the end of 2021, which is nearly three times higher than the official death toll.The executives who “eat their own dog food” The act of testing your own product or service, otherwise known as “dogfooding”, is spreading from software development to other industries. Leadership and staff who take on frontline shifts in roles such as customer service or food delivery gain empathy — and valuable insights on how to improve their business.TravelDaniel Humm, one of the world’s top chefs, has called New York City home for the past 15 years. Living where he does means he never runs short on inspiration for his two great passions: food and art. Humm shares his jam-packed itinerary for a perfect day in New York, taking on chess hustlers, catching Daniel Craig in “Macbeth” and sampling exquisite Japanese plant-based cuisine.

David Humm, top chef and chess player © Cole Wilson More

(Reuters) -With more U.S. travelers expected to take to the skies and the roads this summer as COVID restrictions ease, unbridled demand will strain capacity in the leisure and travel industry and push prices even higher.Airlines, hotels, rental car companies and booking sites all reported a surge in demand for their services in the latest batch of company earnings. But at the same time, many of those companies face a tight labor market and limited volume as they scramble to restart and expand operations after more than two years of depressed demand due to the pandemic.Tripadvisor said travelers should expect inflation to impact all areas of travel purchases in 2022, and booking now versus later can mean locking in better prices. Hilton Worldwide Holdings (NYSE:HLT) Inc plans to continue to reprice hotel rooms “every minute of the day” to limit the impact inflation has on its business, CEO Christopher Nassetta told investors on Tuesday. “As demand has picked up, we have certainly been able to do that and we expect that we will continue to be able to do that,” he said on the company’s earnings call.Hilton’s average daily rates in the United States were 36.4% higher in the first quarter of 2022 compared to the same period in 2021. Average daily rates across hotel companies in the U.S. were up approximately 37.7% in the first quarter of 2022 when compared to the same period in 2021, according to hotel industry data from Smith Travel Research Inc.The price of flights this summer are also trending higher, according to travel search engine Skyscanner. Round trip flights within the U.S. will cost $302 per traveler on average, which is 3% higher during the same period pre-pandemic. Long and ultra-long-haul international flights are up to 20% higher than 2019, costing on average $797 and $1182 respectively. Other segments within the travel industry are facing supply constraints and labor shortages as leisure and business travelers also return.Car rental firm Hertz Global Holdings (OTC:HTZGQ) reported it averaged about 481,000 vehicles during the first quarter of 2022 compared to a pre-pandemic level of approximately 700,000 vehicles.”There’s little question that as demand moves even higher in the summer season, you’ll see [utilization] stress further,” said Hertz CEO Stephen Scherr, adding that the available supply of vehicles is limited and needs to be managed very carefully. Staffing woes have also marred operations in recent weeks at carriers such as Alaska Airlines and JetBlue, forcing them to cut summer schedules to avoid further disruption.Travel booking app Hopper said domestic airlines are currently scheduled to operate at between 75% to 95% of their 2019 summer capacity from May through August. The Transportation Security Administration (TSA) continues to host hiring events in an effort to increase staff ahead of anticipated summer travel and the return to pre-pandemic passenger volumes, according to a statement from the agency.The TSA in March said the return of (fiscal year) 2019 passenger traffic levels would return in (fiscal year) 2022, a year earlier than previously projected and an increase in staff will help ensure that the “traveling public does not experience excessive wait times.” More

DUBLIN (Reuters) -The head of the world’s second-largest aircraft leasing company said on Thursday Boeing (NYSE:BA) had “lost its way” and might need new leadership to fix a flawed culture that overshadowed its revival.The comments by Avolon Chief Executive Domhnal Slattery represented a rare public rebuke of Boeing by a significant customer, albeit one that cancelled orders for over 100 737 MAX jets during the COVID pandemic. Boeing declined comment. “I think it’s fair to say that Boeing has lost its way,” Slattery told the Airfinance Journal conference in Dublin, a gathering of the world’s aircraft lessors who together own most of the world’s passenger jets. “Boeing has to fundamentally re-imagine its strategic relevance in the marketplace,” he said, adding that this would require “fresh vision, maybe fresh leadership.” However, he said the issues could eventually be resolved. “I have faith that they will figure it out,” Slattery said. Shares of Boeing fell to a nearly 1-1/2 year low last week after the U.S. planemaker posted a quarterly loss, unveiled $2.7 billion in charges and added costs and expressed doubts over hitting 737 MAX delivery targets.Boeing also announced it was halting 777X production through 2023 and failed to specify when it would resume deliveries of its key twin-aisle 787 Dreamliner model after a year-long halt. “They are burning cash at an unprecedented level. They’re probably going to get downgraded,” Slattery said. SUCCESSIVE CRISES”Boeing has a storied history…They build great airplanes. But it’s said that culture eats strategy for breakfast and that is what has happened at Boeing,” Slattery said. A succession of crises from fatal crashes that led to a two-year grounding of the 737 MAX, to external regulatory pressures that interrupted 787 deliveries and delayed the 777X, have left America’s biggest exporter badly shaken, another top buyer said.Underscoring Boeing’s woes, European rival Airbus pushed ahead on Wednesday with plans to raise competing single-aisle jet production by 50% from current levels to 75 a month in 2025, just as Boeing is struggling to certify its 737 MAX 10.Slattery voiced concerns that the market could tilt too heavily in favour of Airbus if it delivers on its production plans, though some lessors say it remains to be seen how soon Airbus can reach its target due to fragile supply chains. Longstanding board member Dave Calhoun became Boeing CEO in 2019 promising greater transparency after the group’s earlier handling of the MAX crisis drew widespread criticism.On Thursday, Boeing announced plans to move its headquarters from Chicago to the Washington, DC, area, highlighting efforts to bring decision-making closer to customers and regulators.But Calhoun’s promise of a reboot has been eclipsed by fresh problems on several core civil and defence projects, while another influential customer, Emirates airline president Tim Clark, has urged Boeing to “get its act together.”Boeing says it is working through the multiple challenges.Calhoun told investors after the company’s board was reaffirmed by shareholders last week that Boeing would overcome new problems with the T-7 military trainer and Air Force One jets and also felt good about progress on the 787 and 737 MAX. More

By Mark Miller(Reuters) -Social Security has never failed to make its benefit payments since the mailing of monthly checks began in 1940, but most Americans these days are worried about the future of the program.Who can blame them? Social Security’s two trust funds are projected to run dry in 2034, and the program would be able to pay only 80% of its obligations to retirees and disabled workers at that point. Politicians don’t exactly generate confidence when they make irresponsible – and wrong – comments claiming that Social Security is going bankrupt or running out of money.The result is public skepticism and concern. Forty-two percent of working Americans tell Pew Research Center pollsters https://pewrsr.ch/3FeMCBa that they doubt they will receive any benefits from Social Security. An equal share thinks they will receive a benefit, but at a reduced level. (https://pewrsr.ch/3FeMCBa).The Social Security trustees have been projecting this shortfall since the early 1990s, but the U.S. Congress has failed to act. What we need is a full, public debate on reform legislation – and an actual vote by lawmakers. The window is open for that to happen this year – the Democratic Party has developed an internal consensus on legislation that addresses the solvency problem, and also expands benefits modestly. It controls both legislative chambers – at least for now.The Social Security 2100 Act is supported by 202 House Democrats – in other words, nearly the entire party caucus. The bill probably cannot jump the hurdle of a Republican filibuster in the U.S. Senate, but it is imperative to get everyone in Congress on the record with a vote on this issue. “People have got to know where you stand,” said U.S. Representative John Larson, a Connecticut Democrat and chief sponsor of the legislation.EXPANDED BENEFITSThe Social Security 2100 legislation would close 52% of the long-term shortfall, according to an analysis by the Social Security actuaries. It would push the trust fund depletion date back to 2038 by adding new payroll taxes to wages over $400,000 – currently, taxation stops at $147,000. Earlier versions of the bill restored solvency for 75 years by also gradually increasing payroll tax rates, but that has been eliminated to reflect President Joe Biden’s campaign pledge not to raise taxes on people with incomes below $400,000 per year.The bill does recognize the need to expand benefits, which can help address rising income inequality, and racial and gender gaps in retirement security. The COVID-19 pandemic has widened those gaps. What’s more, Gen-Xers and Millennials are likely to fare even worse than boomers and today’s seniors when they reach retirement. This is the result of factors including escalating higher-education costs, staggering student debt burdens, wage stagnation, soaring housing costs and the decline of traditional defined benefit pensions.Social Security 2100 includes a modest 2% across-the-board boost in benefits, and it would shift the annual cost-of-living increase to a more generous formula. It also includes targeted benefit increases such as a new minimum benefit level for very low income seniors, and improved benefits for widows and widowers. It also would provide caregiver credits that increase benefits for people who take time out of the workforce to care for dependent family members. And it would repeal the Windfall Elimination Provision (WEP) and Government Pension Offset (GPO), which currently penalize many people who work in the public sector. What would Republicans do to solve the Social Security problem if they take control of Congress next year? Earlier versions of Republican reform plans have called for benefit cuts in the form of higher retirement ages and means testing. U.S. Senator Rick Scott, a Florida Republican, recently set off a small firestorm with a proposal to sunset all federal legislation every five years – an idea that at least in theory would require regular reauthorization of Social Security and Medicare. He also wants every American to pay income taxes – no matter their level of income.Republicans have also made clear that they prefer to handle Social Security reform behind closed doors. Senator Mitt Romney, a Utah Republican, has proposed the ironically named TRUST Act, which would create a closed process for legislators to propose changes to the Social Security and Medicare trust funds, culminating in an up or down vote process.This approach is a favorite play for lawmakers looking to keep their fingerprints off unpopular legislation – bills emerge from faceless, bipartisan committees. The last time it was attempted for Social Security was the unsuccessful Bowles-Simpson commission, which proposed a range of unpopular benefit cuts in 2011 that would have impacted middle-class seniors. Fighting to improve Social Security would fulfill a promise that Biden made as a presidential candidate, and it could energize voters. Public opinion polling has consistently shown strong public support for maintaining current benefit levels, even if new taxes are needed.New polling by Data for Progress shows that increasing benefits would make a large chunk of independent voters more likely to support Democratic candidates for Congress this fall. The idea of shoring up Social Security polls extremely well with middle-class Americans: 63% of those without a college degree tell Pew pollsters that Social Security finances should be a top priority for Congress and the president.This is a battle worth fighting in 2022.The opinions expressed here are those of the author, a columnist for Reuters. More

The level of workers who retired then came back a year later is running around 3.2%, just about where it was before the pandemic.
A thriving jobs market in which workers virtually have their pick on where to go, coupled with soaring inflation and the fading of Covid fears all are contributing to the trend.

A worker grinds a weld on a safe that is being manufactured at Liberty Safe Company on March 22, 2022 in Payson, Utah.
George Frey | Getty Images

The Covid pandemic sent more than 8 million workers to the sidelines at one point, including many folks who decided it was the right time to retire as the workplace as they knew it faded out of sight.
But with a thriving jobs market in which workers virtually have their pick on where to go, coupled with soaring inflation and the fading of Covid fears, some are finding it a good time to rethink their plans and come back to the fold.

In fact, the level of workers who retired then came back a year later is running around 3.2%, just about where it was before the pandemic, after dipping to around 2% during Covid’s worst days, according to calculations from job placement site Indeed.
“The unretirement trend is emblematic of what we’re seeing in the labor market overall, which is seeing increasing labor force participation for a broad swath of workers,” said Nick Bunker, economic research director for North America at Indeed.

Along with the other factors, Bunker said employers are ramping up incentives to fill 11.5 million job openings. There are about 5.6 million more vacancies than there are available workers, creating a strong power base for those looking for work, no matter the age.
“Employers are taking steps to entice people. There’s an elevated share of postings that mention terms like hiring bonuses, retention bonuses,” Bunker said. “There are signs that employers are starting to lure people in with bonuses like that.”
A much higher cost of living than two years ago also is factoring in.

Prices in March increased 8.5% from a year ago, according to the Bureau of Labor Statistics, and that higher cost of living is posing hardship for people living on fixed incomes.
“For people who were formerly retired and are now returning to work, it certainly is having an impact,” said Bunker, though he added that he is “skeptical it’s the main factor.” He pointed, for instance, to conditions following the financial crisis in 2008 when retirees started coming back even though inflation was nowhere near the level it is now.
For Tommy Benz, a former executive at Verizon Wireless who retired from a position at Endurance International, returning to work was a bit about a desire to stay busy but also about loyalty to his high school alma mater.
Benz, a 54-year-old Mountain Top, Pa., resident, has been taking substitute teaching jobs recently as a way to help out Crestwood High School, which needed classroom help badly. The town is in the northeast part of the state, about 110 miles north of Philadelphia.
“While subbing was not something I aspired to do in retirement, it was always in the back of my mind,” Benz said. “When I learned of the shortage they were facing, it became an easy decision.”
How many more people have come back to work will become a little clearer Friday when the BLS releases its nonfarm payrolls report for April.
The labor force participation rate was 62.4% in March, roughly a full percentage point up from its pre-pandemic level but well off the low of 60.2% in April 2020. The total labor force level, after sinking by more than 8.2 million from February 2020 to April of the same year, is about 200,000 shy of the pre-Covid state.
Economists surveyed by Dow Jones expect that payrolls increased by 400,000 in April and the unemployment rate fell to 3.5%, which would bring it back to its February 2020 level.

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