Daily Business Briefing
Sept. 13, 2021Updated
Sept. 13, 2021, 4:10 p.m. ET
Sept. 13, 2021, 4:10 p.m. ETCredit…Doug Mills/The New York Times
A trade group representing some 2,000 consumer brands sent a letter to President Biden on Monday asking for clarification about his announcement last week that all companies with more than 100 employees will soon need to require vaccination or weekly testing.
Mr. Biden said last week that the Department of Labor and its Occupational Safety and Health Administration would draft the rules, which would affect some 80 million workers.
But the mandate has raised vexing issues for employers as they deal with the practicalities of vaccination policies, said Geoff Freeman, the president of the trade group, the Consumer Brands Association.
On Monday, Mr. Freeman called on Mr. Biden to “create immediate clarity” about how private businesses should carry out aspects of the White House’s plan to achieve “our shared goal of increased vaccination rates.”
He shared 19 questions that represented a “small sampling” of those raised by the trade group’s members. Among them:
What proof-of-vaccination documentation will the companies need to collect, and will booster shots also be required?
Must employees be fully vaccinated?
Will workers who have had the coronavirus still have to be vaccinated or get tested?
Will the requirements apply only to vaccines that are fully approved by the Food and Drug Administration? (The Pfizer-BioNTech vaccine is currently the only shot with full approval.)
Who is responsible for vaccination tracking — the government or the individual businesses?
What are the consequences of falsifying a vaccination status?
Other questions, on testing and other policy details, covered similar ground, touching on how federal guidelines interact with state-level initiatives, who will be responsible for paying for testing and whether waivers would be allowed if employee absences or attrition resulted in supply chain disruptions.
Also of concern, Mr. Freeman said in an interview, is the slow pace at which government tends to move, compared with the quick decisions that private businesses are used to making. This has been a problem during the pandemic, he said.
“For 19 months, we’ve been working with either the Trump administration or the Biden administration and all of the agencies involved in this,” he said. “And the simple truth is that they have been slow to keep up with the pace of change.”
He added: “All of us want to get to the other side of this thing as quickly as possible. It’s not going to work in this scenario unless an entity like OSHA can move at the pace of the business environment.”
Major business trade groups have generally been supportive of the mandate, which gives otherwise wary businesses the cover to require inoculation.
The U.S. Chamber of Commerce, the nation’s largest business lobbying group, has said it “will work to ensure that employers have the resources, guidance and flexibility necessary to ensure the safety of their employees and customers and comply with public health requirements.” Another major business advocacy group, the Business Roundtable, has said it “welcomes” the Biden administration’s actions.
But they have also been racing to understand the details and implications, which can vary depending on a company’s size. Does a company’s worker count include part-time employees? What is the deadline for compliance? Will potential lawsuits slow the process down?
The White House has said it will provide more guidance by Sept. 24.
At this point, “there are more questions than answers,” said Ian Schaefer, a partner at the law firm Loeb & Loeb who specializes in labor issues.
Even as companies are calling their lobbyists and lawyers for more insight, many are discussing at a senior level the realities of putting a mandate in place, despite not yet knowing exactly what that might entail, he said.
“In the absence of actionable intelligence that gives a little bit more guidance and direction, I think they’re sort of controlling for what they can control, which is a lot of internal politics at this point,” Mr. Schaefer said.
Read moreCredit…Brendan Mcdermid/Reuters
A news release published on Monday morning claiming that Walmart would begin accepting payments in Litecoin, a digital currency, drove up its price by 30 percent before the retail giant said that the announcement was fake.
The release, which appeared to come from Walmart itself, was published on Globe Newswire, a communication service whose parent company, Intrado, is owned by the private equity firm Apollo Global Management. The release landed just as trading began in the U.S. stock market, and was quickly picked up by several big news outlets, including Reuters and Bloomberg. The price of Litecoin and other cryptocurrencies, such as Bitcoin, jumped on exchanges like Coinbase.
Walmart soon issued a statement saying that the Litecoin announcement was not true, and that it had not authorized its publication
“We are digging into it further to understand what happened,” said Randy Hargrove, a Walmart spokesman.
It was not clear who was behind the fake release, which had enough of the hallmarks of a corporate release to appear authentic but which listed a contact email address at the unauthorized website walmart-corp.com, and how it made it past Globe Newswire’s systems. But it was hardly the first hoax of its kind. In 2010, another news wire service published a fake release saying the cereal company General Mills was the subject of a federal investigation.
In 2009, federal securities regulators charged a broker with disseminating false releases to manipulate the shares of several public companies. In that case, the Securities and Exchange Commission moved swiftly and filed an enforcement action just three weeks after the scheme began.
Securities lawyers said regulators would likely open an investigation because the hoax involved a publicly traded company, and it did not matter if the biggest surge in price was in a largely unregulated digital currency.
“It is a misrepresentation involving a public issuer,” said Andrew Calamari, a lawyer with Finn Dixon & Herling and a former director of the S.E.C.’s securities and New York office.
Federal prosecutors also have broad jurisdiction to investigate market hoaxes of this kind under the wire fraud statute.
Representatives for the S.E.C. and Globe Newswire were not immediately available for comment.
Walmart learned of the release only after it started receiving calls from reporters seeking to confirm accounts from some news outlets that had published information based on the release, Mr. Hargrove said.He noted that Walmart typically uses Businesswire, a rival communication service, for its announcements and that the press contact named in the release does not work in Walmart’s media division.
The news was also briefly posted by the @Litecoin Twitter account. The Litecoin Foundation, which supports the currency’s development, later posted that it had not entered into a partnership with Walmart.
Read moreCredit…Stefani Reynolds for The New York Times
President Biden plans to nominate Alvaro Bedoya, an online privacy expert, for a seat on the Federal Trade Commission, putting a critic of the technology industry in a key position to regulate the sector, according to two people familiar with the plans.
Mr. Bedoya is a lawyer who has studied the way new technologies can violate privacy. He was an author of a 2016 report that called for Congress to more closely regulate the use of facial recognition software by law enforcement. And he was previously the top lawyer on the privacy subcommittee of the Senate Judiciary Committee.
If he is confirmed, Mr. Bedoya will join an agency that is primed to take aggressive action against the technology industry and other corporate giants. The agency’s chair, Lina Khan, is a legal scholar who has argued for regulations that would rein in Silicon Valley’s power over commerce and personal data.
“He’s blazed a trail in holding Big Tech accountable and has spent his career fighting on behalf of the powerless, particularly those in immigrant communities,” Charlotte Slaiman, the director of competition policy at the pro-regulation think tank Public Knowledge, said in a statement. “His scholarship and advocacy revealed how Big Data is used to facilitate oppressive surveillance and racial discrimination against the most vulnerable.”
Mr. Biden will nominate Mr. Bedoya to the seat currently held by Rohit Chopra, an avowed progressive whom the president has nominated to lead the Consumer Financial Protection Bureau.
Mr. Bedoya declined to comment. His expected nomination was first reported by Axios.
Credit…Scott McIntyre for The New York Times
Consumer expectations for short- and medium-term inflation jumped sharply in August, according to a survey released by the Federal Reserve Bank of New York on Monday, reaching the highest level since the numbers were first compiled in June 2013.
Consumers expect prices to rise 5.2 percent in the year from August, the survey found, up from 4.8 percent the month prior. Expectations for inflation over three years climbed to 4 percent, from 3.7 percent in July.
Federal Reserve officials, who shape policy to ensure that inflation remains low and stable, are closely watching any changes in expectations. They have said that they anticipate recent bursts in inflation to be temporary as the economy heals from the pandemic. Persistently high expectations can give companies more cover to raise prices, locking in faster inflation.
In contrast to the New York Fed numbers, market-based inflation expectations have been relatively stable after moving up earlier this year, and real-world price increases may begin to ease in important categories in the months ahead.
But inflation has been climbing for months as consumers have paid more for airline tickets, televisions and burritos. Supply-chain disruptions have caused many of the price jumps, as factory shutdowns and disturbances of shipping routes have led to significant delays in manufacturing and transporting products. Labor shortages may also be exacerbating the issue, as some employers have had to offer higher wages to attract workers.
Consumers surveyed said they anticipated higher prices for gas, food, medical care and rent. The survey compiles responses from a rotating panel of about 1,300 households nationwide.
Fueled by “The Queen’s Gambit” and “The Crown,” Netflix dominated the competition at the Creative Arts Emmy Awards over the weekend.
Netflix took home 34 Emmys at three separate ceremonies on Saturday and Sunday, while Disney+, the streamer’s closest competitor, won 13 awards. HBO and its streaming service, HBO Max, the perennial Emmys heavyweight, won just 10 awards.
Each year, the Television Academy, which organizes the Emmys, announces the winners for dozens of technical awards in the lead-up to the biggest prizes that are announced at the main event, the Primetime Emmy Awards. This year’s prime-time ceremony will take place on Sunday and will be broadcast on CBS.
“The Queen’s Gambit,” a limited series about a chess prodigy, won nine Creative Arts Emmys over the weekend, more than any other series. Its closest competitors, with seven awards each, were the Disney+ Star Wars action adventure show “The Mandalorian” and the NBC stalwart “Saturday Night Live.”
Although the Creative Arts Emmys are not quite prime-time ready — they include awards like best stunt performance, best hairstyling and outstanding lighting direction for a variety series — they count all the same in the Hollywood record books, and the leaderboard for the 73rd Emmy Awards is now officially underway.
The weekend ceremonies also handed out a few key acting awards. “The Queen’s Gambit” took the prize for best cast in a limited series. It beat out a pair of acclaimed HBO series, “I May Destroy You” and “Mare of Easttown.” “The Crown” won for best cast in a drama, and the Apple TV+ show “Ted Lasso” won for best cast in a comedy. Both are favored to take more prizes at the main event.
Netflix’s dominance all but guarantees that it will win more Emmys than any other TV network, studio or streaming platform, making 2021 the first year it will beat out its chief rival, HBO, to claim ultimate bragging rights. Three years ago, in a first, Netflix tied HBO for top honors. Going into this year’s Emmys ceremonies, HBO, aided by HBO Max, led all networks with 130 nominations, one more than Netflix.
The 73rd Emmy Awards will effectively be a showcase for television achievement during the pandemic. Because of production shutdowns and delays, the number of TV shows in the second half of last year and the first half of this year declined. Submissions for the top categories this year were down 30 percent.
The ceremony, hosted by Cedric the Entertainer, will take place indoors and outdoors on the Event Deck at L.A. Live, near the Emmys’ usual home at the Microsoft Theater in downtown Los Angeles. Attendance will be drastically reduced, but in contrast to last year’s remote ceremony, most winners are likely to deliver their acceptance speeches in person.
Read moreCredit…Kris Connor/WireImage, via Getty Images
The Federal Election Commission has dismissed Republican accusations that Twitter violated election laws in October by blocking people from posting links to an unsubstantiated New York Post article about Joseph R. Biden Jr.’s son Hunter Biden, in a decision that is likely to set a precedent for future cases involving social media sites and federal campaigns.
The F.E.C. determined that Twitter’s actions regarding the Hunter Biden article had been undertaken for a valid commercial reason, not a political purpose, and were thus allowable, according to a document outlining the decision obtained by The New York Times.
The commission’s ruling, which was made last month behind closed doors and is set to become public soon, provides further flexibility to social media giants like Twitter, Facebook and Snapchat to control what is shared on their platforms regarding federal elections.
The suppression of the article about Hunter Biden caused an avalanche of conservative criticism in October and prompted accusations that the tech company was improperly aiding the Biden presidential campaign, including a formal complaint by the Republican National Committee that said Twitter’s actions amounted to an “illegal in-kind contribution” to the campaign.
But the F.E.C. disagreed. The commission said Twitter had “credibly explained” that blocking the article’s distribution was a commercial decision and that the move followed existing policies related to hacked materials, according to the “factual and legal analysis” provided to the parties involved in the complaint.
Twitter actually reversed course within a day of its decision to block distribution of the Hunter Biden article, and its chief executive, Jack Dorsey, has called the initial move a “mistake.”
The F.E.C.’s official vote on the case — the commission is split equally between three Democratic-aligned commissioners and three Republicans — is not yet public, nor are any additional statements written by commissioners. Such statements often accompany the closure of cases and can provide further insight into the commission’s reasoning.
In addition to rejecting the R.N.C. complaint, the F.E.C. dismissed other allegations that Twitter had violated election laws by “shadow banning” Republican users, or appearing to limit the visibility of their posts without providing an explanation; suppressing other anti-Biden content; and labeling former President Donald J. Trump’s tweets with warnings about their accuracy. The F.E.C. rejected those accusations, writing that they were “vague, speculative and unsupported by the available information.”
Led by Mr. Trump, Republicans have increasingly been at odds with the nation’s biggest technology and social media companies, accusing the Silicon Valley giants of giving Democrats an advantage on their platforms.
Twitter initially said that it had prevented linking to the Hunter Biden article because of its existing policy against distributing hacked materials. The article was based on material provided by Trump allies who had sought for months to tarnish the elder Mr. Biden over his son, and focused on the Bidens’ involvement in Ukraine.
But Mr. Dorsey, Twitter’s chief executive, acknowledged in October that blocking links “with zero context as to why” had been “unacceptable.”
Soon after, Twitter said that it was changing its policy on hacked materials and would allow similar content to be posted, including a label to provide context about the source of the information.
The F.E.C. documents reveal one reason that Twitter had been especially suspicious of the Hunter Biden article. The company’s head of site integrity, according to the F.E.C., said Twitter had “received official warnings throughout 2020 from federal law enforcement that ‘malign state actors’ might hack and release materials associated with political campaigns and that Hunter Biden might be a target of one such operation.”
The F.E.C. said it found “no information that Twitter coordinated” its decisions with the Biden campaign. In a sworn declaration, Twitter’s head of U.S. public policy said she was unaware of any contacts with the Biden team before the company made its decisions, according to the F.E.C. document.
Twitter did not immediately respond to a request for comment.
Emma Vaughn, an R.N.C. spokeswoman, said the committee was “weighing its options for appealing this disappointing decision from the F.E.C.”
Read moreCredit…Tom Brenner for The New York Times
House Democrats’ plans to raise taxes on the rich and on profitable corporations stop well short of the grand proposals many in the party once envisioned to tax the vast fortunes of tycoons like Jeff Bezos and Elon Musk — or even thoroughly close loopholes exploited by high-flying captains of finance.
Instead, the House Ways and Means Committee, influenced more by the need to win the votes of moderate Democrats than by progressive Democratic ambitions, focused on traditional ways of raising revenue to pay for the party’s $3.5 trillion social policy bill — by raising tax rates on income.
The proposal, which is set to be considered by the panel on Wednesday, does include measures to raise taxes on the rich. Taxable income over $450,000 — or $400,000 for unmarried individuals — would be taxed at 39.6 percent, the top rate before President Donald J. Trump’s 2017 tax cut brought it to 37 percent. The top capital gains rate would rise from 20 percent to 25 percent, a considerably smaller jump than President Biden proposed.
A 3-percent surtax would be applied to incomes over $5,000,000.
But more notable is what is not included. The richest of the rich earn little money from actual paychecks (Mr. Bezos’s salary from Amazon was $81,840 in 2020). Their vast fortunes in stocks, bonds, real estate and other assets grow each year largely untaxed.
The Senate Finance Committee wants to tax that wealth with a one-time surtax imposed on billionaires’ fortunes, followed by levies annually on the gains in value of billionaire assets, the way property taxes are adjusted each year to reflect gains in housing values. The Ways and Means Committee shrugged that off.
Representative Bill Pascrell, Democrat of New Jersey and a Ways and Means Committee member, conceded on Monday that the real wealth in the country is tied up in assets, not large salaries, but he said many Democrats were leery of going too far.
“I am very suspect of a wealth tax,” he said. “I think it’s perceived as ‘soak the rich.’ I don’t think it is, but that’s how it’s perceived.”
The committee did take aim at a loophole in retirement savings exploited by billionaire Peter Thiel, who, according to a ProPublica investigation, was able to take a Roth individual retirement account worth less than $2,000 in 1999 and grow it to $5 billion, which could be completely shielded from taxation.
In a Roth I.R.A., small annual deposits of money from previously taxed income are allowed to gain in value free of capital gains taxation, as long as it the funds are withdrawn after retirement. But Mr. Thiel, the founder of PayPal and a prominent Silicon Valley conservative, opened his Roth, then deposited stakes in start-up companies at fractions of pennies a share, which then exploded when the start-ups took off. The gains in value — and investments made in other companies from those gains — will go completely untaxed if Mr. Thiel waits to withdraw it just before he turns 60.
To prevent such exploitation, the Ways and Means Committee would stop contributions to retirement accounts once they reach $10 million.
In other areas, the committee appears to be making only glancing blows at the nation’s highest fliers. Barack Obama, Mr. Trump and President Biden have all vowed to close the so-called carried interest loophole, in which private equity managers pay low capital gains tax rates on the fees they charge clients, asserting that it is not income since it is drawn from their clients’ investment gains.
Senate Democrats hope to close the loophole completely, saving the Treasury $63 billion over 10 years. The House proposal would force Wall Street financiers to hold their clients’ investment gains for five years before claiming them as capital gains and cashing out, a demand that could limit the use of carried interest, but would save a fraction of the Senate proposal, $14 billion.
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The Organization of the Petroleum Exporting Countries said on Monday that demand for oil was expected to rebound above prepandemic levels next year.
In its Monthly Oil Report, the group said it expected oil demand to average 100.8 million barrels per day in 2022, compared with just over 100 million in 2019, before the pandemic took hold.
The forecast is evidence that the world economy is still heavily dependent on emissions-causing fossil fuels, despite growing concerns about climate change and a steep fall in oil demand during the pandemic. The news emerged just as world leaders were preparing for what many analysts predict will be a crucial climate summit, known as COP26, in Glasgow in November.
Sales of electric cars have grown strongly, and investment in wind and solar energy has held up surprisingly well during the pandemic, but the growth in demand for energy, especially in China and India, will offset such gains, according to OPEC forecasts.
China, for instance, is expected to consume almost 15 million barrels a day in oil next year, 1.5 million barrels a day more than it burned in 2019.
The pandemic slammed oil demand, which plummeted by around nine million barrels a day last year, or about 9 percent, OPEC said. Oil consumption has recovered strongly, but the emergence of the fast-spreading Delta variant has applied the brakes. Now, OPEC expects some of the recovery in oil demand previously forecast this year to be put off until 2022.
In its report, OPEC said it was raising its demand forecast for 2022 by 900,000 barrels a day while slightly lowering its estimates for the final three months of this year. Oil consumption will grow by a hefty 4.2 million barrels a day next year after a surge of six million barrels a day in 2021, according to OPEC.
“The pace in recovery in oil demand is now assumed to be stronger and mostly taking place in 2022,” OPEC analysts wrote.
U.S. stocks were up slightly in midday trading Monday, with indexes flitting between losses and gains after the S&P 500 dropped for five consecutive trading sessions in its worst streak since February.
The S&P 500 was up 0.2 percent, while the Nasdaq composite was flat.
The Labor Department is set to publish its latest report on prices on Tuesday. The Consumer Price Index, a key inflation gauge, for August will help indicate whether the increasing prices from the pandemic are temporary. Federal Reserve officials are watching inflation data closely as they consider when to begin slowing large-scale bond purchases.
The price of the cryptocurrency Litecoin briefly jumped 30 percent after an announcement claiming that Walmart would begin accepting it as payment. The retail giant later said that the announcement was fake.
European stock indexes rose, with the Stoxx Europe 600 closing 0.3 percent higher. Asian markets were mixed.
Oil prices rose with, West Texas Intermediate, the U.S. crude benchmark, up 1 percent to $70.40 a barrel. OPEC on Monday raised its forecast for global oil demand for 2022 to 100.8 million barrels a day.
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Shares of Soho China, a real estate company run by a prominent power couple, fell by one-third on Monday after Blackstone Group walked away from its deal to buy the firm.
Soho China said in a joint filing late on Friday that Blackstone would not go through with its $3 billion bid for a controlling stake in the company, without giving a reason. Blackstone, the Wall Street investment giant, and Soho China declined to comment further on Monday.
The company is controlled by Zhang Xin and Pan Shiyi, a married couple who share the title of executive director. Mr. Pan, who is chairman, was one of the first Chinese entrepreneurs to use social media for public relations and has tens of millions of followers online. Ms. Zhang is well known in part for her role in a 2013 deal to buy a stake in the General Motors Building in Manhattan.
The news comes as China’s most successful business tycoons face scrutiny and growing pressure to share more of their wealth. The deal, which would have been among the real estate sector’s biggest, was announced in June, with a regulatory review pending. It was seen as a move by the husband-and-wife team to reduce their exposure to China.
A deal for Soho China could have also shored up confidence in the country’s real estate sector, which, after years of remarkable growth, is coming under greater regulatory scrutiny as Beijing tries to put a stop to corporate binge borrowing. Developers have been forced to start paying off mounting bills under new central bank rules, called the “three red lines.”
Evergrande, China’s biggest developer, has spooked investors, home buyers and experts who are predicting a bankruptcy in the near future.
In recent weeks, real estate prices and demand in some of China’s biggest cities have started to weaken. A prominent Beijing think tank said last week that the sector had “shown signs of a turning point.”
Real estate woes, plus reports of greater regulatory tightening in mainland China, contributed to a drop of nearly 2 percent in Hong Kong shares on Monday.
Read moreCredit…Ryan Christopher Jones for The New York Times
Fannie Mae, the federally backed institution that buys mortgages from the banks, plans to peer into many people’s bank accounts — with their permission — for a record of regular rent payments to help assess qualification for mortgages.
Its data showed that only 17 percent of people who had not owned a home in the previous three years and would not have qualified for a mortgage before might do so now. But those 17 percent are drawn from a group that is disproportionately people of color, many of whom have limited credit histories and come from marginalized groups on the wrong side of a decades-long wealth gap.
Fannie Mae effectively sets many of the standards for who qualifies and what data counts, and until now, rent has not counted, despite it being the largest payment most renters make each month. For many years now, consumer advocates and industry insiders alike have agreed that this is not how things should be.
The convoluted, multistep process that Fannie is using will mean many people won’t benefit from it at first. The New York Times’s Your Money columnist, Ron Lieber, takes a look →