Newsletter: California Inc.: Time to return to a galaxy far, far away
Welcome to California Inc., the weekly newsletter of the L.A. Times Business Section.
I’m Business columnist David Lazarus, and here’s a rundown of upcoming stories this week and the highlights of last week.
Southern California claimed representation in the Cabinet of President-elect Donald Trump with the announcement that fast-food executive Andrew Puzder has been tapped to be the next Labor secretary. He’s head of the Carpinteria parent company of Carl’s Jr. and Hardee’s — and is known for employing scantily clad women to hawk oversized burgers.
LOOKING AHEAD
Golden Globes: On Monday, the Hollywood Foreign Press Assn. will announce the nominees for the 74th Golden Globe Awards. Nominations will be revealed in 25 categories aimed at honoring the best movies and TV shows of the year, as well as the best actors, directors and musical scores. Monday’s announcements will begin at 5 a.m. (yes, that’s a.m.). and will be live-streamed on the Golden Globes website. The Golden Globes will air on NBC on Jan. 8.
Toxic metal: On Tuesday, the Paramount City Council is expected to consider a moratorium barring new metal businesses. Residents of Paramount have pressed community leaders for action after recent studies detected high levels of a potent, cancer-causing metal in the air in the small working-class city southeast of Los Angeles. Paramount is the home of more than 80 metal-related businesses. Along with barring new businesses, the moratorium would prevent existing operations from expanding.
Rate hike likely: Federal Reserve policymakers are widely expected to increase the central bank’s benchmark short-term interest rate when they meet Tuesday and Wednesday. Fed officials have been hinting for months that an increase was coming. With new reports showing solid job gains nationally and a nine-year low unemployment rate in November, investors view a rate increase as a long-awaited validation that the economy is making significant progress.
Out of business? President-elect Donald Trump has scheduled a news conference for Thursday where he’s expected to announce plans to remove himself from his businesses. Numerous questions have arisen since Trump’s election about how he will avoid conflicts of interest while president when making decisions that could affect his companies. He tweeted that “legal documents are being crafted which take me completely out of business operations.”
New flicks: That disturbance in the Force you’re feeling? It’s the release of Disney’s “Rogue One: A Star Wars Story,” the first of many anticipated “stand-alone” Star Wars movies. This one’s official release date is Friday, but it really opens Thursday night. Prerelease audience tracking is all over the place, but analysts think it will have a stellar opening weekend of roughly $150 million in the U.S. and Canada.
THE AGENDA
Monday’s Business section examines the tone President-elect Trump has set for dealing with companies. After successfully pressuring heating and air-conditioning systems maker Carrier Corp. to keep hundreds of jobs in Indiana instead of sending them for Mexico, Trump wasted little time in fingering another exit-ready manufacturer in Indianapolis, Rexnord Corp. Analysts say some companies now will think twice about decamping. Why incur the risks of stiff penalties, damaging publicity and possibly even hectoring from the White House?
STORY LINES
Here are some of the other stories that ran in the Times Business section in recent days that we’re continuing to follow:
A new day: California is at the epicenter of some of the most fundamental changes Donald Trump has proposed for the national economy, in trade and immigration. About 40% of all goods arriving in the United States by sea come through the state’s ports. And more than a quarter of all immigrants who are in the U.S. illegally live in California, many of them working in agriculture, hospitality and manufacturing.
Producer in chief: Trump is retaining his executive producer credit — and financial ties — with the NBC reality show “Celebrity Apprentice” as he transitions to his new role in Washington. NBC is preparing to launch “The New Celebrity Apprentice” on Jan. 2 with former California Gov. Arnold Schwarzenegger stepping in as the show’s boardroom judge. He replaces Trump as the lead character who decides the fates of various contestants.
Deceptive advertising: The Los Angeles city attorney’s office is accusing four big retailers of deceptive advertising for allegedly misleading shoppers into believing that thousands of products were on sale at a hefty discount. The retailers — JCPenney, Sears, Kohl’s and Macy’s — falsely advertised high “list” or “regular” prices on merchandise that was never actually for sale at those prices, according to the lawsuits. That led customers to believe that they were getting a better bargain than they actually were.
Refunds challenged: California Insurance Commissioner Dave Jones has ordered more than $100 million in refunds for nearly 2 million State Farm policy owners, alleging the company charged excessive rates for its homeowners and renters insurance. Now, State Farm is fighting back. The insurer has filed a lawsuit in San Diego County Superior Court to throw out the decision and challenging the commissioner’s authority under Proposition 103 to order the refund.
O Tannenbaum: A Christmas tree shortage could have many Southern California shoppers feeling the holiday blues. Some local sellers have increased prices 10% or more on certain varieties, especially the popular Noble fir, because they have become scarce. Industry experts say an oversupply of Christmas trees nearly a decade ago brought low returns, prompting many growers to stop planting trees. That has led to a shortage this year among SoCal sellers.
WHAT WE’RE READING
And some recent stories from other publications that caught our eye:
Tax credit: The New York Times observes that working-class Americans keep losing economic ground. Donald Trump has promised tax cuts to remedy things. Another way is “expanding a tax credit that is already in place and enjoys bipartisan support.”
Turbulence: Popular Mechanics says Trump made a bad call in demanding cancellation of Boeing’s contract to build a new generation of Air Force Ones. “Getting new planes to fly the president around is not an easy, cheap or quick process.”
We got us a convoy: As Quartz tells it, truckers believe they’ve got decades to go before robots take their jobs. Silicon Valley engineers say that “truckers aren’t preparing for a future that’s coming sooner than they think.”
Net neutrality: The Daily Beast notes that Trump has tapped a pair of telecom lobbyists to head his FCC transition team. “That’s bad news for net neutrality, the policy that says Internet service providers must treat all data equally.”
Preparing for Skynet: Fast Company says chipmakers are racing to create hardware for artificial intelligence. “The importance of such chips for developing and training new AI algorithms quickly cannot be understated, according to some AI researchers.”
SPARE CHANGE
Speaking of Skynet, what’s the best movie about technology run amok? The “Terminator” flicks have to rank highly. Old-school sci-fi fans will recall “Colossus: The Forbin Project.” Not to mention “WarGames” and “Tron.” For me, though, it’s a toss-up between the “Matrix” movies and “2001,” with the edge for all-time craziest computer going to the HAL 9000.
For the latest money news, go to www.latimes.com/business. Until next time, I’ll see you in the Business section.
David Lazarus’ column runs Tuesdays and Fridays. He also can be seen daily on KTLA-TV Channel 5 and followed on Twitter @Davidlaz. Send your tips or feedback to david.lazarus@latimes.com.
