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    Stocks Rise as Fed Chair Powell Signals Rate Cuts in Jackson Hole Speech

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    Jerome H. Powell made it clear that the Federal Reserve will cut rates on Sept. 18, as the central bank turns the corner in its fight against inflation.Speaking in his most closely watched speech of the year, Jerome H. Powell, the chair of the Federal Reserve, clearly signaled on Friday that the central bank was poised to cut interest rates in September.And while Mr. Powell stopped short of giving a clear hint at just how large that move might be, he forcefully underscored that the central bank stands prepared to adjust policy to protect the job market from weakening further and to keep the economy on a path for a soft landing.“The time has come for policy to adjust,” Mr. Powell said during the Kansas City Fed’s annual conference at Jackson Hole in Wyoming. “The direction of travel is clear, and the timing and pace of rate cuts will depend on incoming data, the evolving outlook and the balance of risks.”He then added: “We will do everything we can to support a strong labor market as we make further progress toward price stability.”Mr. Powell’s speech was his firmest declaration yet that the Fed is turning a corner in its fight against inflation. After more than a year of holding interest rates at 5.3 percent, the highest level in more than two decades, officials finally have enough confidence to change their stance by cutting rates at their Sept. 17-18 meeting.Policymakers have been using those high rates to try to cool the economy and, by doing so, wrestle down rapid inflation. But as price increases slow substantially and the job market shows signs of wobbling, officials no longer need to hit the brakes quite so hard.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

  • 125 Shares179 Views

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    U.S. Plans to Accuse RealPage of Enabling Collusion on Rents

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    The Justice Department is set to file an antitrust suit against the real estate company RealPage alleging illegal price-fixing facilitated by algorithms.The Justice Department plans to file an antitrust lawsuit as soon as Friday against the real estate software company RealPage, claiming its software enabled landlords to collude to raise rents, two people with knowledge of the lawsuit said.The suit, which will be joined by California, Colorado, Minnesota, North Carolina, Washington and other states, was expected to accuse RealPage of facilitating a price-fixing conspiracy that boosted rents beyond market forces, according to the people, who spoke on the condition of anonymity because of the sensitivity of the case.The suit would escalate the government’s efforts to regulate what it sees as misuse of technology. Officials have sued Google, Amazon, Meta and Apple over what they said were monopolistic behaviors that harm consumers.RealPage’s YieldStar product, which gathers confidential real estate information, has been at the heart of the government’s concerns. Landlords, who pay for the software, share information about rents and occupancy rates that is otherwise confidential. Based on that data, an algorithm generates suggestions for what landlords should charge renters, and those figures are often higher than they would be in a competitive market, according to allegations in prior lawsuits against RealPage by state attorneys general.A spokeswoman for the Justice Department declined to comment.Owned by the private equity firm Thoma Bravo, RealPage has advertised its software to landlords as a tool that can help them outperform the market by 3 percent to 7 percent. It says its software is used in metro areas around the country.RealPage did not immediately respond to requests for comment. A spokesperson for Thoma Bravo did not immediately respond to a request for comment.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

  • 163 Shares119 Views

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    Why the Fed’s Jackson Hole Confab Matters for Wall St. and the Economy

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    The Federal Reserve Bank of Kansas City’s annual conference in Wyoming gets a lot of buzz. Here’s why it matters for Wall Street and the economy.Anyone who has flipped through newspapers or business television channels this week might have noticed two words on repeat: Jackson Hole.They refer to the premier central banking conference of the year, which is held late each August at the Jackson Lake Lodge in Grand Teton National Park in Wyoming. This year’s conference kicks off Thursday and runs through Saturday.To the uninitiated, it might seem weird that what is arguably the most important economic event in the world is held in remote Wyoming, two time zones away from the Federal Reserve’s Washington-based Board of Governors and 1,047 miles from its host, the Kansas City Fed. And the symposium itself is hardly your average conference. Loafers cede to cowboy boots. Attendees snack on huckleberry pastries (or swill huckleberry drinks) while discussing the latest economic papers.But if Jackson Hole is a little bit incongruous, it is also unquestionably important, an invite-only gathering where paradigm-shaping research is presented and momentous policy shifts are announced. The event has long been an obsession on Wall Street.This year will be no exception. Jerome H. Powell, the Fed chair, is scheduled to speak Friday morning, and markets are waiting anxiously to parse his remarks for even the slightest hint about how much the Fed might cut interest rates at its meeting next month — and how quickly central bankers will reduce borrowing costs after that.Wondering how a monetary policy conference held at the tail end of August became such a big deal and why it has stayed that way? Curious whether this year’s Jackson Hole conference will matter for mortgage rates or job prospects?We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

  • 150 Shares119 Views

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    Powell Faces Economic Crossroads as He Prepares to Speak at Jackson Hole

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    Jerome Powell, the Federal Reserve chair, will deliver remarks as inflation cools and growth holds up — but as labor market weakening threatens to interrupt the soft landing.Two years ago, Jerome H. Powell took the podium at the Federal Reserve Bank of Kansas City’s annual conference at Jackson Hole in Wyoming and warned America that lowering inflation would require some pain.On Friday, Mr. Powell, the Federal Reserve chair, will again deliver his most important policy speech of the year from that closely watched stage. But this time, he is much more likely to focus on how the Fed is trying to pull off what many onlookers once thought was unlikely, and maybe even impossible: a relatively painless soft landing.Both the Fed and the American economy are approaching a crossroads. Inflation has come down sharply since its 2022 peak of 9.1 percent, with the year-over-year increase in the Consumer Price Index falling to 2.9 percent in July. Given the progress, the critical question facing Fed officials is no longer how much economic damage it will take to wrestle price increases back under control. It is whether they can finish the job without inflicting much damage at all.That remains a big if.Consumer spending and overall economic growth have held up in the face of high interest rates, which are meant to cool demand and eventually weigh down inflation. But the job market is beginning to weaken. Revisions released this week showed that employers hired fewer workers in 2023 and early 2024 than was previously reported. The unemployment rate rose to 4.3 percent in July, up from 4.1 percent in June and 3.5 percent a year earlier. The latest jump could be a fluke — a hurricane messed with the data — but it could also be an early warning that the economy is hurtling toward the brink of a recession.That makes this a critical moment for the Fed. Officials have held interest rates at a two-decade high of 5.3 percent for a full year. Now, as they try to secure a soft and gentle economic landing, they are preparing to take their foot off the brake. Policymakers are widely expected to begin lowering rates at their meeting in September.Mr. Powell could use his speech to confirm that a rate cut is imminent. But most economists think that he will avoid detailing just how much and how quickly rates are likely to drop. Fed officials will receive a fresh jobs report on Sept. 6, providing a clearer idea of how the economy is shaping up before their Sept. 17-18 meeting.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

  • 125 Shares169 Views

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    What Kalamazoo (Yes, Kalamazoo) Reveals About the Nation’s Housing Crisis

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    A decade ago, the city — and all of Michigan — had too many houses. Now it has a shortage. The shift there explains today’s costly housing market in the rest of the country.For years, when Michigan politicians talked about the state’s housing problem, they were referring to a surplus: too many run-down houses, stripped of valuable copper, sitting empty and blighting neighborhoods. Now the message has flipped. In her State of the State address this year, Gov. Gretchen Whitmer lamented the housing shortage and landed one of her biggest applause lines with, “The rent is too damn high, and we don’t have enough damn housing. So our response is simple: ‘Build, baby, build!”If you want to know what the housing crisis for middle-income Americans looks like in 2024, spend some time in Michigan. The surplus-to-shortage whipsaw here is a mitten-shaped miniature of what the entire country has gone through.I’ve been writing about housing and the economy for two decades, and have watched as the nation’s housing market has made the journey from boom to bust to deficit, seemingly without pausing for a normal middle. There are lots of reasons this happened, but they center on a big one: the late-2000s housing bust, which the country has never fully recovered from. Or as Ali Wolf, chief economist at Zonda, a data and consulting firm, put it: “The Great Recession broke the U.S. housing market.”At first, rapidly rising housing costs seemed like a regional problem. It made sense that places like San Francisco, which was already expensive, filled with well-paid tech workers and hamstrung by stringent building regulations, would be in crisis. Much of the rest of the country was still affordable, however, so high-cost “superstar cities” were seen as an exception instead of a warning.Now California’s problem is everywhere. Double-income couples with good jobs are priced out of homeownership in Spokane, Wash. Homeless encampments sprawl in Phoenix. The rent is too damn high in Kalamazoo.The housing crisis has moved from blue states to red states, and large metro areas to rural towns. In a time of extreme polarization, the too-high cost of housing and its attendant social problems are among the few things Americans truly share. That and a growing rage about the country’s inability to fix it.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

  • 113 Shares149 Views

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    Harris’s Price-Gouging Ban: Price Controls or No Quick Effect?

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    The plan does not appear to amount to government price controls. It also might not bring down grocery bills anytime soon.Vice President Kamala Harris threw her support behind a federal ban on price-gouging in the food and grocery industries last week. It was the first official economic policy proposal of her presidential campaign, and it was pitched as a direct response to the high price of putting food on the table in America today.“To combat high grocery costs, VP Harris to call for first-ever federal ban on corporate price-gouging,” the Harris campaign proclaimed in the subject line of a news release last week, ahead of a speech laying out the first planks of her economic agenda.It is still impossible to say, from publicly available details, what exactly the ban would do. Republicans have denounced the proposal as “communist,” warning that it would lead to the federal government setting prices in the marketplace. Former President Donald J. Trump has mocked the plan on social media as “SOVIET Style Price Controls.”Progressives have cheered the announcement as a crucial check on corporate greed, saying it could immediately benefit shoppers who have been stunned by a 20 percent rise in food costs since President Biden took office.But people familiar with Ms. Harris’s thinking on the ban now say it might not resemble either of those characterizations. The ban, they also suggest, might actually not do anything to bring down grocery prices right now. Those who spoke about the strategy behind the emerging policy did so on the condition of anonymity.Ms. Harris’s campaign has created the space for multiple interpretations, by declining to specify how that ban would work, when it would apply or what behaviors it would prohibit.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

  • 125 Shares99 Views

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    Harris and Trump Offer a Clear Contrast on the Economy

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    Both candidates embrace expansions of government power to steer economic outcomes — but in vastly different areas.Vice President Kamala Harris and former President Donald J. Trump flew to North Carolina this week to deliver what were billed as major speeches on the economy. Neither laid out a comprehensive policy plan — not Ms. Harris in her half-hour focus on housing, groceries and prescription drugs, nor Mr. Trump in 80 minutes of sprinkling various proposals among musings about dangerous immigrants.But in their own ways, both candidates sent voters clear and important messages about their economic visions. Each embraced a vision of a powerful federal government, using its muscle to intervene in markets in pursuit of a stronger and more prosperous economy.They just disagreed, almost entirely, on when and how that power should be used.In Raleigh on Friday, Ms. Harris began to put her own stamp on the brand of progressive economics that has come to dominate Democratic politics over the last decade. That economic thinking embraces the idea that the federal government must act aggressively to foster competition and correct distortions in private markets.The approach seeks large tax increases on corporations and high earners, to fund assistance for low-income and middle-class workers who are struggling to build wealth for themselves and their children. At the same time, it provides big tax breaks to companies engaged in what Ms. Harris and other progressives see as delivering great economic benefit — like manufacturing technologies needed to fight global warming, or building affordable housing.That philosophy animated the policy agenda that Ms. Harris unveiled on Friday. She pledged to send up to $25,000 in down-payment assistance to every first-time home buyer over four years, while directing $40 billion to construction companies that build starter homes. She said she would permanently reinstate an expanded child tax credit that President Biden temporarily established with his 2021 stimulus law, while offering even more assistance to parents of newborns.She called for a federal ban on corporate price gouging on groceries and for new federal enforcement tools to punish companies that unfairly push up food prices. “My plan will include new penalties for opportunistic companies that exploit crises and break the rules,” she said, adding: “We will help the food industry become more competitive, because I believe competition is the lifeblood of our economy.”We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

  • 150 Shares139 Views

    in Economy

    Kamala Harris Blames ‘Price Gouging’ for Grocery Inflation. Here’s What Economists Say.

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    Price increases when demand exceeds supply are textbook economics. The question is whether, and how much, the pandemic yielded an excess take.In detailing her presidential campaign’s economic agenda, Vice President Kamala Harris will highlight an argument that blames corporate price gouging for high grocery prices.That message polls well with swing voters. It has been embraced by progressive groups, which regularly point to price gouging as a driver of rapid inflation, or at least something that contributes to rapid price increases. Those groups cheered the announcement late Wednesday that Ms. Harris will call for a federal ban on corporate price gouging on groceries in an economic policy speech on Friday.But the economic argument over the issue is complicated.Economists have cited a range of forces for pushing up prices in the recovery from the pandemic recession, including snarled supply chains, a sudden shift in consumer buying patterns, and the increased customer demand fueled by stimulus from the government and low rates from the Federal Reserve. Most economists say those forces are far more responsible than corporate behavior for the rise in prices in that period.Biden administration economists have found that corporate behavior has played a role in pushing up grocery costs in recent years — but that other factors have played a much larger one.The Harris campaign announcement cited meat industry consolidation as a driver of excessive grocery prices, but officials did not immediately respond on Thursday to questions about the evidence Ms. Harris would cite or how her proposal would work.There are examples of companies telling investors in recent years that they have been able to raise prices to increase profits. But even the term “price gouging” means different things to different people.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More